Nikola And Plug Power Form Green Hydrogen, Fuel Cell Truck Supply Partnership

Plug Power is aiming to become the top U.S. supplier of hydrogen made from water and renewable power.

Plug will supply up to 125 tons of green hydrogen per day and also sell it equipment to convert 30 tons of hydrogen gas per day into liquified form at a hydrogen production facility that is being built in Arizona. Plug plans to purchase 75 hydrogen-powered trucks from Nikola over the next three years and use them to haul tanker loads of carbon-free fuel.

Financial details of the deal were not provided by the companies.

Both companies want to increase the use of green hydrogen, derived from renewable, carbon-free sources instead of natural gas, for transportation, stationary power generation and industrial applications. Plug is building hydrogen refineries in the US that will be able to produce 500 ton of hydrogen per day by the year 2025. A hydrogen fuel cell truck will be produced at the factory in Coolidge, Arizona, by the end of the year.

The president of Nikola's energy unit said in an email that the two companies share a common vision for sustainable, efficient energy solutions. The partnership with Plug will support the expansion of the hydrogen energy business and the adoption of the Class 8 trucks.

Plug Power wants to use green hydrogen as the fuel of the future. The CEO is betting on something.

The Inflation Reduction Act was signed into law this year by President Joe Biden. It includes a production tax credit for clean hydrogen that provides up to $3 per kilogram of the fuel, which makes it more competitive with diesel.

Even though hydrogen is a less energy efficient option for power than a battery, companies that are developing hydrogen trucks say it's a more practical option for long-haul heavy trucks. The fuel cell power system can be refueled in about the same amount of time as a diesel truck, because it is not as heavy. The Tre battery-electric semi can haul up to 330 miles, but the fuel cell version can go up to 500 miles.

The practicality of electric trucks like the new Semi remain a mystery. Frito-Lay bought the first production versions of Musk's trucks without revealing how much they cost as well as their weight and hauling capabilities. According to one observer, based on the video of the Semis in action, they may only be able to carry about half the cargo of a conventional truck.