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Individual investor primarily focused on clean energy systems / solutions that reflect and address the need for man's activities to be in harmony with our planet's natural ecosystems while supporting man's need for abundant, low-cost energy. Always looking for a good deal too!
  • Plug Power - Part Of A Much Larger Picture 5 comments
    Jan 14, 2014 10:12 AM | about stocks: PLUG, BLDP, HYGS, FCEL

    There has been so much fall out and discussion after the professional looking but unfortunately mis-leading, in my opinion, posts from Dr. Akston that I wanted to share a bird's eye view of the industry as a whole and where PLUG fits in. Like any company with a viable product in a viable market, PLUG has competitors. HYGS is one, for example and there are many other players, large and small.

    As a first step toward understanding this industry, let's first take a look at the hydrogen fuel cell (H2/FC) industry association's web site.

    Next, let's focus on some of the individual players in the industry and take a look at some major companies that are making a commitment to H2/FC technology (the following is not a complete list, I just want to highlight a few here for you with some links to sites that provide a sense of the extent of the industry and how the technology works)...

    Air Products explains hydrogen as an energy carrier

    Air Liquide's hydrogen production capacity and a link to a Financial Times article on Air Liquide investing in PLUG
    (Air Liquide is a global industrial gas company that invested $6.5M in PLUG in May, 2013)

    Automotive Fuel Cell Cooperation
    (some major players are partners in this joint venture)

    Ballard lists the applications they see for fuel cells

    DoE's H2/FC program
    (This U.S. government program is one of many such programs internationally but I'll save the international view for another post)

    FuelCell Energy on fuel cells

    Honda's Fuel Cell Electric Vehicle (FCEV), the Clarity

    Hydrogenics on hydrogen technology

    Linde's presentation of hydrogen as an energy carrier

    Mercedes' FCEV

    Praxair's presentation on their H2/FC business

    Siemens shares their view on the role of H2/FC technology

    Finally, Toyota's FCEV

    Please take some time to visit each of these links and browse around a bit to get an understanding of the scope of the industry in which PLUG is a rising star.

    As you can see, hydrogen fuel cell technology is an emerging global industry, PLUG is just one player in a sea with some significantly bigger fish swimming in it. I happen to think that small companies, dedicated to a H2/FC product like PLUG's, are wonderful investments as this technology starts to take off. (At some point, we may begin to see acquisitions as companies like GE decide it's time to get into the game.)

    If you invest in a large company with a market cap in the billions, the stock is not going to move much just because they are putting a toe in the H2/FC waters. But companies like PLUG, BLDP, HYGS, and FCEL with relatively small caps that make great H2/FC technology can and should move up as their technology and markets evolve.

    The ship is finally coming in for companies like PLUG because their products have found a niche and their H2/FC technology is, in fact, better (contrary to Dr. Akston's assertions) at delivering electricity in a way that is cleaner, more efficient, and will ultimately be less expensive than conventional batteries.

    Warren Buffett has said it's more important to know the "what" about a business or technology as opposed to the "when."

    If we focus on "what" is currently happening and could be coming up for PLUG and others in the H2/FC market, we have...

    a) An existing and fast-growing market for fuel cell power to replace conventional batteries in electric forklifts. They already have a 90% share of this market. Users of electric forklifts are loving the short "charge" time with PLUG's hydrogen fuel cells (just fill up the hydrogen gas tank in five minutes as opposed to wait a few hours while the not-so-environmentally-friendly battery charges).

    b) Range extenders for FedEx trucks which we just learned about a few days ago...hmmm, could range extenders be used in any other battery electric vehicles like the Nissan Leaf or the Tesla Model S?

    c) Transportation Refrigeration Units (TRUs) the loud gasoline motors that generate electric power to keep refrigerated trucks cold could be quieter and more reliable if the electricity was delivered by fuel cells. PLUG is likely to be major player in this sizable market.

    d) Marine propulsion...if you like spending time on the water, you probably hate the sound of an outboard motor...what if you had an electric outboard powered by PLUG fuel cell packs? Silent and elegant.

    e) Auxiliary "hotel" power units (APUs) for trucks (so they can comply with anti-idling laws while drivers catch up on sleep and keep warm quietly).

    f) APUs for sailing and motor yachts. Nobody likes hearing a loud diesel or gas powered generator running having just dropped anchor in a quiet cove.

    g) Backup and/or reliable power for cell phone towers or hospitals or even grid applications (fuel cells are relatively easy to scale).

    h) Stuff I haven't thought of (please contribute your ideas for other applications for the technology in the comments).

    I believe PLUG has finally made it through the "valley of death" (admittedly, it has been a long road for them), has a viable product, and that it is worth taking a long position and hanging on for the ride! Let's not waste time finding fault with them by looking backward and focusing on the detritus of the very rough ride they have endured.

    It seems that one "institutional investor" agrees with those of us who see PLUG as an emerging player in a growing market worth a long position. Here are the details of the $30M investment that Plug Power announced on Friday, January 10, 2014.

    In addition to PLUG, I also believe that HYGS, BLDP, and FCEL are good investments and that BLDP could ultimately be a much larger player. The daily stock prices of these companies will, of course, fluctuate wildly for various reasons but from here on out, the general trend should be upward for the H2/FC sector in my view.

    Personal bias disclosure: I have a strong passion for hydrogen as a "fuel" and am an unabashed crusader for the ultimate success of H2/FC technology. I have been working in the hydrogen fuel cell industry on and off since 1995. I believe in the "what" of this technology, and feel confident that its "when" is now.

    Disclosure: I am long BLDP, PLUG, HYGS, .

    Stocks: PLUG, BLDP, HYGS, FCEL
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Comments (5)
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  • PICOLOMINI
    , contributor
    Comments (782) | Send Message
     
    Extremely helpful to get a broader understanding of the issues.
    14 Jan 2014, 11:22 AM Reply Like
  • CleanEnergyNow
    , contributor
    Comments (351) | Send Message
     
    Author’s reply » Thanks, glad it helped to shed a little light...
    14 Jan 2014, 01:57 PM Reply Like
  • krishnamg
    , contributor
    Comments (3) | Send Message
     
    Nice and extremely well written article. I strongly believe these companies / industry is going to be huge in the future. I am long on PLUG, FCEL, BLDP. Will look into adding HYGS..
    15 Jan 2014, 06:41 AM Reply Like
  • LTI0723
    , contributor
    Comments (826) | Send Message
     
    Very helpful. Thanks.
    15 Jan 2014, 03:08 PM Reply Like
  • tigru1
    , contributor
    Comments (26) | Send Message
     
    Very interesting, strong buy for the future.
    21 Jan 2014, 11:02 PM Reply Like
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