Plug Power has secured $30m by transferring investment tax credits from its Woodbine, Georgia, green hydrogen plant to an investor, despite funding from the Inflation Reduction Act (IRA) being suspended under the Trump administration.
The hydrogen firm said it had “boosted its liquidity through the transfer of the Federal Investment Tax Credit (ITC)” to an unnamed major investor “with a strong track record of purchasing comparable credits.”
Under the Inflation Reduction Act (IRA), Plug says its 40MW Woodbine liquid green hydrogen plant is eligible for both the $3/kg offered by section 45V, as well as the 30% ITC to subsidise the project’s CAPEX investment, thanks to the plant’s storage abilities.
However, Plug says it has transferred the $30m awarded through the ITC to an unnamed investor.
Chief Financial Officer (CFO), Paul Middleton said, “Plug is leveraging tax credit transferability to offset a portion of our investment in our hydrogen plants, which will provide liquidity and reduce future fuel costs.
“This transaction represents a key non-dilutive balance sheet opportunity and sets the stage for future ITC monetisation opportunities as we continue to build out of our green hydrogen ecosystem.”
However, the move designed to bolster the company’s balance sheet comes as funds from the IRA are suspended following an executive order from President Trump, while department heads review the act’s alignment with the administration’s drive towards fossil fuels.
Read more:Analysis: What does Trump’s IRA and IIJA funding suspension actually mean for hydrogen?
This could also reduce further opportunities for companies to monetise such credits, creating uncertainty for investors and slowing the growth of green hydrogen projects.
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