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Speaker 1: Treasury Department just releasing guidance on the Inflation Reduction Act

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Speaker 1: Hydrogen Production tax credit. Some say it coult hinto the

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Speaker 1: hydrogen industry in the United States rather than Glowers. So

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Speaker 1: let's bring in someone who is directly involved for more

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Speaker 1: on the impacts now on companies in general. Let's bring

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Speaker 1: in Andy Marsh, President and CEO of Plug Power. So

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Speaker 1: anding your first reaction to the guidance that was issued

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Speaker 1: Friday by the Treasury.

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Speaker 2: Disappointing. I think many of us feel it did not

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Speaker 2: follow the law. The people who were primarily responsible for

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Speaker 2: writing it, people like Senator Krper and Center Mansion have

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Speaker 2: said so. So there is a great deal of disappointment.

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Speaker 2: That being said, you know, there's a lot of work

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Speaker 2: still to be done. It certainly makes you're much more

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Speaker 2: attractive in the United States in the near term. But

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Speaker 2: there is now a comment period and Plug will aggressively

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Speaker 2: participate in the comment period.

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Speaker 1: Yeah, there is a sixty day comment period, and I

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Speaker 1: can imagine there will be intense lobbying Andy, But can

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Speaker 1: you give us some specifics on why this hydrogen credits

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Speaker 1: which does provide what three dollars per kinogram of production?

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Speaker 1: Why it won't s for more domestic production.

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Speaker 2: Yeah, so you know, out of nowhere, there were three

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Speaker 2: additions that was made administratively by the buying administration associated

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Speaker 2: with a concept called a regionality, which really limits the

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Speaker 2: regions that you can use to generate the hydrogen versus

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Speaker 2: the grid. I think the one that really has people

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Speaker 2: the most excited is additionality, which limits the use of

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Speaker 2: nuclear power with the electoralizers to create green hydrogen as

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Speaker 2: well as hydropower. Certainly has certainly puts many of the

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Speaker 2: hydrogen hubs at risk as well. It's time matching something

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Speaker 2: you realized you could not implement until after twenty thirty.

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Speaker 2: They've worked on this issue for a long time, and

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Speaker 2: the regulations as standardays stays twenty twenty eight. Now we know,

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Speaker 2: let me go a little bit more positive. We think

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Speaker 2: from a plug perspective, we can work around the regionality issues.

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Speaker 2: May not be great for the whole hydrogen industry, but

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Speaker 2: it is something we can work around. And look the documents,

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Speaker 2: hundreds and hundreds of pages, and what we found some

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Speaker 2: far so far, there is many, many contradictions, and there'll

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Speaker 2: be an aggressive effort by ourselves and others in the

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Speaker 2: industry to help straighten the regulations out. And also another

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Speaker 2: positive I can say, I've talked to many Senators who

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Speaker 2: tell me that the regulation it will get easier, not harder.

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Speaker 2: So we do expect the regulations so loose enough.

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Speaker 3: As you fight some of these regulations, as you fight

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Speaker 3: some of these new rules, what are you most looking

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Speaker 3: for and how much do you expect the Biden administration

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Speaker 3: to actually meet in the middle.

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Speaker 2: I think the Biden administration is hearing lots from political pointees,

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Speaker 2: lots from the hydrogen hubs. There were seven hydrogen hubs

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Speaker 2: which were announced in November which would put at risk.

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Speaker 2: I'm hopeful that the voices of leading senators, the voices

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Speaker 2: of leading governors will have it as well as companies

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Speaker 2: will have influence in modifying the rules to be aligned

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Speaker 2: quite honestly with the legislation.

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Speaker 3: And it's worth asking also these new rules, what is

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Speaker 3: the economic impact in your estimation?

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Speaker 2: We spent a lot of time, probably spent millions of

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Speaker 2: dollars working with consultants understanding the regulations and the impact,

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Speaker 2: and our initial take from our models is that it

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Speaker 2: reduces see hydrogen output in the United States and by

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Speaker 2: twenty thirty, by seventy percent, and the US will not

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Speaker 2: be able to achieve its green hydrogen goals, which includes

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Speaker 2: you know, reaching thirty gigle watts per day by twenty thirty.

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Speaker 2: We think that number is now in the six or

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Speaker 2: seven gigawats range, and that's why I think we're confident

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Speaker 2: there will be changes once there is a common period

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Speaker 2: for the regulation.

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Speaker 1: Andy, what do you say to those that say, look,

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Speaker 1: you know, heydrogen might be clean on its own, but

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Speaker 1: when it's used in conjunction with natural gas or some

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Speaker 1: other kind of fossil fuels, it's a you know, a

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Speaker 1: dirty source of energy.

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Speaker 2: Well, I first I would take a look. I also

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Speaker 2: could say electric vehicles are a dirty source of energy

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Speaker 2: many for many of them run on coal. But I

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Speaker 2: think it is a journey. You know, plug is involved

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Speaker 2: with green hydrogen, which means you have to have a

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Speaker 2: renewable source online to provide the generation. And I think,

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Speaker 2: you know, when we look at it, you never able

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Speaker 2: to scale the industry to where you need to go

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Speaker 2: unless you provide a playing field that's open during the

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Speaker 2: next five or six years, so businesses can scale electoralizers,

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Speaker 2: which are the key critical component in generating green hydrogen

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Speaker 2: so that their costs effective. When these laws were written,

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Speaker 2: they were written with the purpose of driving down the

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Speaker 2: cost of electoralizers to match fossil fuel generator energy. And

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Speaker 2: by tightening the rules, we actually are delaying, ultimately a

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Speaker 2: source of energy which is important for twenty six percent

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Speaker 2: of the reduction in CO two in time. So no,

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Speaker 2: it is disappointing, but I think the administration will keep

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Speaker 2: an open mind and I would expect some changes.

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Speaker 1: And just on a person not with Plug power. On

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Speaker 1: your third quarter earnings call, you did you know, mention

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Speaker 1: the various ways you were trying to raise money. Obviously

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Speaker 1: the SoC has been, you know, on a little bit

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Speaker 1: of a journey, let's say, in the last few years.

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Speaker 1: Can you give us an update on your conversations with

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Speaker 1: the Department of Energy.

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Speaker 2: Sure, we're moving it, you know, we expect then the

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Speaker 2: first quarter we'll be making announcement. But I think more

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Speaker 2: important to know Plug has a very very strong balance sheet.

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Speaker 2: We have a balance sheet that's close to five billion dollars.

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Speaker 2: We have great customers and you know this, this has

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Speaker 2: been a very tough year. But it's my experience when

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Speaker 2: you take a look, does anyone really believe fossil fuels

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Speaker 2: is the answer for the future, and Plug is the

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Speaker 2: leading pure play hydrogen company in the world, so I

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Speaker 2: feel confident about the coming year.

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Speaker 3: Annie, thank you so much for your time. That is

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Speaker 3: Andy marsh is the President and CEO of Plug Power.