Plug Power (PLUG), the U.S.’s largest clean hydrogen company, soared 10% after the Senate revealed changes to the GOP tax bill that now extend hydrogen tax credits through January 1, 2028 — two full years longer than originally planned.
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That change is more than just political maneuvering. It gives hydrogen producers a longer runway of incentives to scale operations, attract buyers, and make the economics of green hydrogen more competitive with fossil fuels. For Plug Power — and others like Bloom Energy (BE), up 8.5% — the extended credits are a direct boost to potential revenue, capital investment, and long-term profitability.
What the Tax Credit Means Economically
At the core is the cost structure. Hydrogen made via electrolysis, a cleaner method powered by renewables, is still expensive compared to hydrogen made from natural gas. But the extended tax credits reduce the net cost of green hydrogen, helping companies like Plug close the price gap. That improves both demand potential and margins over time.
This matters for customers too. Walmart (WMT), for example, already buys Plug’s hydrogen to power its forklift fleet. If costs keep falling thanks to these incentives, more big-name industrials may join in, pushing up both demand and adoption. That strengthens Plug’s customer base and gives it more stability amid its current losses.
Why the Market Is Cheering
Plug has built hydrogen plants in Louisiana and Georgia, but has been bleeding money and struggling with tepid demand. Shares are still down nearly 50% over the past year, trading at just $1.16. But this policy update changes the conversation.
Suddenly, Plug isn’t just a speculative clean tech name. It’s a company with a government tailwind, potential for expanding contracts, and a clearer path to profitability.
Bloom Energy, meanwhile, builds fuel cells that can run on both natural gas and hydrogen. Most clients still use gas today, but if hydrogen becomes cost-competitive thanks to tax policy — as the new bill pushes toward — they may switch over. That flexibility gives Bloom strategic upside.
Big Oil Backs the Boost
Surprisingly, even oil giants like Exxon Mobil (XOM) have supported these credits. Hydrogen may one day replace natural gas in hard-to-decarbonize industries, and these firms are preparing for that pivot. Their lobbying helps explain why hydrogen got support in a conservative-led bill, and it adds industrial credibility to what was once a fringe energy source.
This policy move gives Plug Power and its peers more time, more support, and more investor interest. It doesn’t erase the risks — Plug is still a money-loser, and demand must rise to meet supply — but it does shift the odds. After months in the gutter, Plug Power finally has a reason to rally.
Is Plug Power Stock a Good Buy?
Plug Power (PLUG) is currently rated a Hold on TipRanks, based on 19 analyst ratings over the past three months. Of those, four are Buys, 11 are Holds, and four are Sells. The average 12-month PLUG price target is $1.29, which implies a 0.4% downside from the current price of $1.30.
