Plug Power, SK Group eye hydrogen JV

Plug Power and SK Group have unveiled plans to form a strategic partnership to accelerate hydrogen as an alternative energy source in Asian markets.

Through this partnership, Plug Power and SK Group intend to provide hydrogen fuel cell systems, hydrogen fueling stations, and electrolyzers to the Korean and broader Asian markets.

In conjunction with this partnership, the companies have also entered into a definitive agreement for SK Group to make a $1.5 billion strategic investment in Plug Power and are unveiling a plan to form a joint venture company in South Korea to support the rapidly growing Asian market.

The combination of SK Group’s presence throughout Asia’s energy industry and its strategic direction on portfolio transformation to green via hydrogen economy with Plug Power’s leadership in hydrogen fuel cell systems, fueling stations and green hydrogen generation represents a powerful team to accelerate the growth of hydrogen economy in Asian markets, the pair said in its statement.

In January 2019, the South Korean government announced the Hydrogen Economy Roadmap through 2040, with ambitious goals, including over 5mm tons of hydrogen per year, over 6mm fuel cell EVs, 1,200 refilling stations and 15 GW of fuel cell power generation. The cumulative economic value of South Korea’s hydrogen economy is expected to reach ~$40Bn by 2040.

This investment represents the largest U.S. clean energy PIPE in the last 20 years, Plug Power said.

Under the terms of the investment, a US unit of SK Group will make a $1.5 billion investment in Plug Power by acquiring approximately 51.4 million shares of common stock at a price of $29.2893 per share.

The investment is expected to represent an approximate 9.9 per cent pro forma ownership stake in Plug Power.

The investment transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the first quarter of 2021.