Plug-in power supply (NASDAQ: PLUG) Shares are up today and investors see a path to more gains. This is not due to news directly from the hydrogen energy company. Rather, it’s what investors see as a potentially very lucrative new market for Plug Power.
Shares were up 19.9% as of 12:40 a.m. ET on Monday after reports that the Federal Energy Regulatory Commission (FERC) denied a request to increase the amount of power from a nuclear power plant. That request came from the operators of the Susquehanna nuclear power plant to supply energy to a Amazon data center campus.
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Pennsylvania’s nuclear power plant is owned by an independent power producer Languages Energy sold the data center campus to Amazon Web Services (AWS) earlier this year and hoped to close a deal to provide the power needed to run its artificial intelligence (AI) servers. It was thought that it would be an arrangement that would be duplicated in other data centers as energy needs grow worldwide.
Talen wanted regulatory approval to increase the charging capacity from 300 megawatts (MW) to 480 MW for the interconnection between the nuclear power plant and the AWS data center. Plug Power is working to build a hydrogen ecosystem to use its electrolyzers to provide clean energy for industrial energy needs.
Plug Power uses electrolyzers and electricity from renewable sources to split water molecules into hydrogen and oxygen. This creates green hydrogen that can supply data centers with power. It recently announced a framework agreement with an Australian company to provide 3,000 MW of electrolyzer capacity for its ammonia production needs.
Data center operators have looked to using nuclear power, including modular reactors, to meet their energy needs. Using Plug’s electrolyzers would not be an automatic replacement. The hydrogen ecosystem can be expensive and Plug has not yet turned a profit.
It is still too early for investors to jump into stocks hoping that data centers can be a catalyst for new business. But that’s the knee-jerk reaction from some after today’s Talen Energy news.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Howard Smith has positions in Amazon. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.
Why Plug Power Stock Is Charging Higher Today was originally published by The Motley Fool
