89%
Plug Power Inc. delivered a long-awaited funding announcement on Tuesday morning that looked set to fuel a major stock gain.
The alternative-energy company has received a $1.66 billion conditional commitment for a Department of Energy loan guarantee, the company said in a release.
The funding will enable Plug Power PLUG, +12.89% to enhance its network buildout. The company intends to use the money to finance as many as six green hydrogen production sites around the U.S.
Shares were surging 40% in premarket trading Tuesday.
“The loan guarantee will prove instrumental to grow and scale not only Plug’s green hydrogen plant network, but the clean hydrogen industry in the United States,” Chief Executive Andy Marsh said in a release.
Plug Power noted that while the Department of Energy commitment is a “milestone,” there are still various conditions that have to be met before the loan guarantee gets officially funded.
The company has been anticipating the Department of Energy arrangement for months, as it works on improving its cash management internally. For example, Plug Power noted in its last earnings release that its net cash used for operating activities and capital expenditures fell by 38% on a sequential basis during the first quarter.
“Inventory reduction remains a key priority in our cash management strategy for 2024,” Plug Power added in that earnings release last week.
Through Monday’s close, Plug Power shares were down about 61% on a 12-month basis.