Plug Power (PLUG) Q3 2021 Earnings Call Transcript

Plug Power (PLUG -6.95%)
Q3 2021 Earnings Call
Nov 09, 2021, 4:30 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Greetings and welcome to the Plug Power Inc. third quarter 2021 earnings call. [Operator instructions] It's Tuesday, November 9, 2021. I would now like to turn the conference over to Teal Hoyos, director of marketing and communications.

Please go ahead.

Teal Hoyos -- Director of Marketing and Communications

Thank you. Welcome to the 2021 third quarter update call. This call will include forward-looking statements. These forward-looking statements contain projections of our future results of operation or financial position or state of forward-looking information.

We intend that these forward-looking statements to be covered by the safe harbor provision for forward-looking statements contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We believe that it is important to communicate future expectations to investors. However, investors are cautioned not to unduly rely on forward-looking statements and such statements should not be read as a guarantee of future performance or results. As such statements are subject to risks and uncertainties, it's caused actual results or performance to differ materially from those disclosed as a result of various factors, including but not limited to risks and uncertainties discussed under Item 1A Risk Factor and our annual report on Form 10-K for the fiscal year ending December 31, 2020, as well as other reports we file from time to time with the SEC.

These forward-looking statements speak only as of the day in which the statements are made and we do not intend or undertake to -- intend to update any forward-looking statements after this call or as a result of new information. At this point, I would like to turn the call over to Plug Power CEO, Andy Marsh.

Andy Marsh -- Chief Executive Officer

Well, thank you, Teal and welcome, everyone to Plug's third quarter conference call. My opening will be brief since details are provided in our investor letter. I was at COP 26 last week in Glasgow and hydrogen was front and center at the event. It really reiterates Plug's belief that our first-mover advantage will be a definite benefit as we advance our business.

We plan to remain the leader in building out of the global hydrogen economy. We're aggressive on all fronts and have the vision of building out the hydrogen ecosystem today, let me emphasize today. And this is one of the reasons we were building out the first green hydrogen network in the United States. We view green hydrogen as the great accelerator of all fuel cell applications, many of which will be provided by Plug Power.

We don't believe we can do this alone. We've done this via successful acquisitions such as American Fuel Cell to provide us with leading-edge MEA technology. We are doing this with joint ventures with leaders such as SK, Renault, Fortescue and ACCIONA. Also through partnerships with companies such as Airbus and Life.

Acquisitions and partnerships can provide us both technology and access to market. You'll continue to see Plug travel down this path as we aggressively stake our claim in the potential market of $10 trillion. The acquisition of Frames provides Plug multiple benefits. Let me just name a few.

Frames is used to executing on large projects and has worked with Plug for a number of years. They provide us with integration capability to address large-scale gigawatt electrolyzer plants. This matches with their global supply chain reach, provides us a unique capability when we match this with Plug's leading-edge stack and electrolyzer technology. Now, let me just divert a second.

I mean just yesterday, I was in London working on a 750-megawatt deal. Being able to do large-scale plants is really, really critical. On the technology front, Frame brings in expertise in water management, which is critical in the electrolyzer industry. We are now in a better position to address waste and ocean water to provide ourselves and our customers a better, more cost-effective, environmentally friendly solution.

We are thinking a great deal about offshore electrolyzers and between Frames' water management expertise and offshore platforms expertise, this is real value. Additionally, their ability to manage gases such as drying hydrogen is a critical capability that Frames brings to the table. Also, it makes us very European. Of the pure-play hydrogen fuel cell companies, we will have one of the largest employee footprints in the industry with operations in France, the Netherlands and Germany.

They also provide us 150 employees in India to provide back office engineering support for both our electrolyzers and stationary products. Finally, they have long-term relationships throughout the world with companies that have net-zero carbon goals. We believe this acquisition provides us the strongest technical and operational team in the electrolyzer industry. Also finally, I'd like to comment on applied cryo technology announcement that may have been lost in all the activity around the Plug Power Symposium.

Today, liquid hydrogen is the only practical means for storing and delivering hydrogen to most customers based on the high volumetric density versus gases hydrogen. We believe the future storage and delivery of hydrogen will be a mixture of gases hydrogen delivered by pipeline, salt caverns and liquid hydrogen. We believe liquid hydrogen will be a necessity in storage for mobility and stationary application even when hydrogen is delivered to a deep out via pipeline. We believe applied cryo tech provides us with the following.

A liquid hydrogen delivery network and fleet, liquid hydrogen storage and a real cool one, hydrogen mobility fueling, which is particularly important for ports. And as you know, that hydrogen will be exclusively green. Again, Applied Cryo Tech was a company known by Plug. When we analyze our need for hydrogen trailers for the coming four years and recognize the cash savings associated with this transaction paid for the acquisitions.

They also bring us market and technologies. We are also aggressively pursuing increasing the sales for Applied Cryo Tech especially with some of our announced partners. These acquisitions allowed us to increase our guidance to $900 million to $925 million in 2022. Finally, I'd like to discuss gross margins, especially hydrogen service.

We are the largest user of liquid hydrogen in the world and are building a green hydrogen network that is resilient and is not burdened by fluctuating commodity pricing. We have taken the burden in managing the hydrogen network, so our customers always have hydrogen. Our competition is electricity and for large customers, as electricity is always there and with long-term contracts, pricing is consistent. With our green hydrogen network across the U.S.

we can be the same. Our green hydrogen network will eliminate price variability and simplify logistics. In the short term, we are taking the burden so that green hydrogen is viewed as a dependable source of energy. This activity as our network comes online will become quite profitable for Plug Power.

The service business Plug has demonstrated over 50 sites that we have the right equation to have a cost-effective service offering. We'll now roll these changes out across our network. In our shareholder letter, we said we expect a 30% savings by the end of 2022 and 45% by the end of 2023 in our service business. We also see even more advances with our next-generation product.

So now let me turn the phone over to questions. I have three members of our team with me today, Paul Middleton, our CFO; Sanjay Shrestha, who is the GM of our hydrogen energy business; as well as Jose Crespo, GM of our Material Handling business. We're now ready to take your questions.

Questions & Answers:

Operator

[Operator instructions] Our first question comes from the line of Colin Rusch with Oppenheimer. Please go ahead.

Colin Rusch -- Oppenheimer and Company -- Analyst

Thanks so much, guys Andy, just was talking about -- OK. Just so I understand, you're talking about developing electrolyzer assets offshore and piping hydrogen back on land. Did I hear that right or did I misunderstand something?

Andy Marsh -- Chief Executive Officer

Yeah. That is yeah. Yeah. Let me be clear, Colin.

They bring that capability to the table. I don't see that as critical for the next three to four years. We'll have demonstration projects in the coming years at a small scale doing that. I see a couple advantages to that.

So the advantages of moving hydrogen versus electricity for the same price in a pipe, you can deliver 15x more energy. It just makes a lot of sense if you can do it in the ocean. And if you look at the build-out, for example, in Long Island, it's a large opportunity. Frames, though and let me be clear, Colin, in the next three to four years, we have plans that we're working on customers with which are more than 1 gigawatt in size.

They're used to executing on large projects. They've been working with us and have been developing over -- have been working with us on the system with over 30%, 35% of our system integration. I thought it was time to make them part of the Plug team. They additionally -- when you look at some of these large bids and proposals, just to give you a feel, one bid in proposal was over 750 pages long.

It's really detailed and the capability in India really adds that to the equation so that we can respond to customers rapidly. The level of activity in that collectorlyzers can't be understated. You see a lot of activity going on with green ammonia, with methodization, with green hydrogen, of course. And quite honestly, I've been beginning to think about we have our grand opening of the gigafactory on Friday have actually begun thinking about I need to expand really quick because the opportunity set is so large.

Colin Rusch -- Oppenheimer and Company -- Analyst

That's super helpful, Andy. And then I guess maybe the second question is for Sanjay. It's really about preparation of the supply chain to support the build-out of electrolyzer capacity with all the consumables, not just the capex here, but just all of the different elements that go into the full process and the preparation of those folks to kind of march lockstep with you guys in this scale-up.

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Yeah. So again, Colin, how are you? 

Colin Rusch -- Oppenheimer and Company -- Analyst

Good to hear from you Sanjay.

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Indeed. So look, I think this is something we spend a lot of time thinking about, right? And not just that. This, if anything, is one of the key competitive advantage and the differentiation that we have because we're the company that actually is controlling how, where and how do you do the electrolyzer stack, how do you take the cost down, how do you think about the balance of plant, right? And that's one aspect of it, which I think really makes us very unique, puts us in a very, very strong position to be able to really execute on all this green hydrogen generation plant that we're building. And second thing, right, as Andy talked about, all the bids and activity that's happening in the electrolyzer space also puts us in a position where we are our own customer becomes a huge reference for the third-party customers as well, right? And obviously, look, from a supply chain perspective, we have a gigafactory, we've been adding a lot of resources, a lot of talent to make sure that we have all the components that we need.

And we have a detailed time line, Colin, right, when we think about exactly when the electrolyzes need to show up, for example, in our plant in Georgia, for example, for our plant in New York. And we have actually mapped that out. We know exactly when the manufacturing's going to happen in our gigafactory, when do we get the electrolyzers showing up at the site, when do we get the liquefier and the coal box showing up at the site. So we -- obviously, there's a lot of planning and the detail work that has gone on that gives us the level of confidence when we talk about, for example, Georgia, the plant is being up and running in the summer of next year, which, by the way, is almost like 12 months and less than even 12 months since we broke the ground, right? So we feel pretty good about what we're doing, how we're managing the supply chain.

Being able to control it ourselves really puts us in a position to be able to execute on this strategy. Anything you want to add?

Andy Marsh -- Chief Executive Officer

I think you hit it, Sanjay.

Colin Rusch -- Oppenheimer and Company -- Analyst

Thanks guys.

Andy Marsh -- Chief Executive Officer

OK.

Operator

Thank you. Our next question comes from the line of Craig Irwin with ROTH Capital Partners. Please go ahead.

Andy Marsh -- Chief Executive Officer

Hey, Craig.

Craig Irwin -- ROTH Capital Partners -- Analyst

Hey. Andy. Hey, everybody. Andy, I should say congratulations.

I've known you and Sanjay and George McNamee for -- your chairman for 20 years and -- for more than 20 years. And I would say this last year I think there's been more progress and more changes of Plug than the prior two decades and that is tremendous. But I have a confession, right? My head is spinning, right? I have followed this company forever. I know a lot of your partners, a lot of the key people in the supply chain.

And when I talk to investors, there's a lot of different directions they're looking and they're -- people are sometimes just a little bit confused. So with that context, when I step back, I see green hydrogen as the most important strategic initiative at Plug Power right now because that's what allows the carbon footprint that everybody wants to achieve by adopting fuel cell technology. And with that fundamental baseline, I look at the shareholder letter and the fact that you're looking at margins improving by 5 percentage points for hydrogen in the first quarter to as much as 20% exiting the fourth quarter, there's clearly something seismic going on, right, something really fundamental. Can you maybe bridge the gross margin improvement for us as far as what's going on with this hydrogen strategy, what's really working and how the benefit rolls on over the next four quarters?

Andy Marsh -- Chief Executive Officer

Craig, I am going to let Sanjay answer that, but let me just add that I agree with you. I kind of view green hydrogen as kind of the iPhone that enables all these apps for fuel cells as well as for chemical processes to allow people to turn green. But Sanjay, why don't you talk about the gross margin growth?

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Sure. Happy to do that, Andy. And Craig, good to hear from you. So look, I think you picked on something really interesting here, right? So -- and as Andy mentioned during his prepared remarks, what has been our big focus in 2021? Even though we're paying more for the hydrogen, we're trying to make sure that none of our customers ever run into any challenge from the availability of hydrogen to run their mission-critical application.

And that is by far the most important thing for us and our primary focus. But as you go into 2021, 2022 and when you go from Q4 to Q1, right? First thing, we will actually have our Tennessee plant that is now instead of being 6.4 tons, it's going to be at 10 tons, right? So that expansion has happened. That will contribute to reduction in the cost, number one, from a blended cost perspective. Second thing that will happen as you go into the second quarter of 2022, we also have some additional supply from other industrial gas customer that we're able to secure that is also going to reduce the blended cost of hydrogen as well when you go into the second quarter.

But more importantly, what really happens, Craig, as you talked about that seismic shift is in the second half of 2022, as some of our green hydrogen plants come online in the summer of that year, toward the end of that year, that's really what dramatically drives the cost of that blended hydrogen when you go into the second half of the year. And that's the reason why, not this 2022, we talked about what happens in 2023, right? This fuel business goes from being a negative margin business to starting to approach breakeven. And as you start to think about 2024, now you're talking about 30% kind of a gross margin numbers, right? That is all driven by what we expect the cost of our green hydrogen production is going to be, which we've shared with you all and you've actually also seen it in the shareholder letter. That number is below $4 a kilogram.

And you all know -- you all can back into what the ASP is to our end customers and that's why we feel quite good about, look, 2021 has been tough. Margins will improve in 2022, especially as you look at the second half of the year. It's going to continue to improve as you go into '23 and dramatically even improves as you go into 2024 as we build this first-of-a-kind force majeure resilient green hydrogen generation network in North America. And Craig, I think one of the things that's really important to note here, right, is when we build this green hydrogen generation network, it of course helps our margin, right? It, of course, helps from a sustainability perspective, it is a must, as you highlighted, in the energy transition, right? But what this also does is this helps the entire hydrogen economy.

This actually creates a situation where our customer gets more comfortable, but even other hydrogen players in this industry will also get that resilient supply that allows them to even mitigate and manage through some of the force majeure that they have seen in the past, right? So that's how we see it unfolding. So I couldn't agree more with you with your assessment here.

Craig Irwin -- ROTH Capital Partners -- Analyst

Thank you for that, Sanjay and Andy. My next question is obviously -- the big one is guidance, right? You are clearly seeing acceleration across the board, abundant initiatives that are being incredibly well received by your customer base, where you're adding new verticals almost every month. Aviation is going to be really exciting to watch. What can you say is surprising you the most or is -- has made them much faster progress than you would have expected maybe at this time last year.

Andy Marsh -- Chief Executive Officer

Craig, I think without a doubt, it's the electrolyzer business. I am -- and I say this in a good way. I am consumed by meetings with chairmans and chief executive officers. I'll give you example.

I was in Scotland on Friday and a chairman of a company in the ammonia space asked me to come and stay in London for the weekend to discuss huge opportunities. And that happened -- I had that meeting, I ended up leaving London last night around 9:00 or 6:00. That's really commonplace. I had another worldwide large utility leadership grab me on the phone today this morning to want to talk me for an hour.

It is constant where the inflow for electrolyzers never stops. And it's why we made the Frames acquisition. It's also -- I think one of the real advantages we'll have is we're going to be the person with capacity that can actually build electrolyzer plants. And I think folks are recognizing it.

The company I was with Monday highlighted the fact that they've been looking at this space for two years and they've concluded we had the best technologies, the best products and the best manufacturing capabilities when it came to PEM technologies. And really, we're the only ones who could execute and help them meet their needs and help them meet their net zero goals. I didn't expect that a year ago. I think somewhere in 2023, electrolyzers will be bigger than material handling.

And I think sometime in 2024, green hydrogen will be bigger than material handling.

Craig Irwin -- ROTH Capital Partners -- Analyst

Love it. Thank you. I'll hop back in the queue.

Andy Marsh -- Chief Executive Officer

OK.

Operator

All right. Thank you. Our next question comes from the line of PJ Juvekar with Citi.

PJ Juvekar -- Citi -- Analyst

Good morning, Andy and Sanjay. All good. 

Andy Marsh -- Chief Executive Officer

Good Morning PJ, where are you?

PJ Juvekar -- Citi -- Analyst

It's been a long day. Good evening.

Andy Marsh -- Chief Executive Officer

Where are you?

PJ Juvekar -- Citi -- Analyst

I'm based in New York, here.

Andy Marsh -- Chief Executive Officer

Got you. Good evening.

PJ Juvekar -- Citi -- Analyst

Clearly, your margins and business has been hurt within hydrogen -- with purchased hydrogen costs going up. It started going up in second quarter. And what was the impact in third quarter? And then when you look at your gross margin goal of 30% in fuels by 2024, what are the main risks in achieving that number in your mind? Is it energy prices, electrolyzer costs, transportation costs? Can you just walk us through that?

Andy Marsh -- Chief Executive Officer

I'll let Sanjay talk about that, PJ

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Yes. Hey, PJ. How are you? Good to hear from you. Again, look, I think, PJ, you obviously know the industrial gas market quite well, right? So -- and you know what kind of pricing you're seeing in this market, right? So if anything, if we were to just extrapolate and say the green hydrogen pricing should be very similar to what the gray hydrogen pricing in the market is right now based on what you see we're paying for it today, if anything, I think that 30% margin ends up being conservative, right? But our goal here is to really make sure that we're providing our customer with green hydrogen at prices that are arguably better than what we have to pay for gray hydrogen in the market today.

Our goal, as you know, is to grow the size of this pie, not trying to go after existing pie and take a small piece of the pie, right? We want to make sure green hydrogen is economical, a [Inaudible] so that there's more and more application that becomes available. Now more specifically to your question on what are the risks, look, there's always things that can happen that is not anticipated. But as you know, from a renewable pricing perspective, we buy renewable prices on a long-term basis, right? That's something we can control. We know what that is.

There are some areas where we've got to manage the demand charge and things like that, but we know how to do that. We know how to contain the cost of renewable electricity and that's an area where we've spent a tremendous amount of time. Second, electrolyzer, look, this is something we control, right? That, again, is a huge differentiation and competitive advantage we as Plug Power have. And another thing, as you know, from a liquefaction perspective.

I just touched on how we've already expanded our facility in Tennessee to 10 tons a day. We know how to run liquefiers. Now one another thing that we're doing that I think is going to be tremendously helpful, if anything, going to help both the logistics cost as well as the delivery network for us and for the entire industry is once this North American network is built out, if anything, you can actually optimize how do you transport hydrogen to various end customers, right? There are always things that can happen that are unanticipated. But look, as we sit here right now, given that renewable cost is the biggest chunk of the variable cost in terms of producing green hydrogen, we control the electrolyzer.

So we're sitting here feeling pretty good about heads down, execute and get these plants built.

PJ Juvekar -- Citi -- Analyst

Great. Sanjay, thank you. And my second question is, on the Giga Factory that if that ramps up, you have the order book in front of you with electrolyzers needed for your own hydrogen plants, your fuel still stacking capability needed for materials handling business. So as the Giga Factory runs up, that operating leverage should translate into significant incremental margins.

I would just wondering if you can just has that been taken into account in your guidance and when does the real inflection point come.

Andy Marsh -- Chief Executive Officer

I'll let Paul take that, PJ

Paul Middleton -- Chief Financial Officer

Yeah. And good afternoon, PJ. Good to hear from you again. So it's going to have a significant effect next year.

I mean it's turning on as we speak. We're going to be ramping production out of that facility. And I would just broaden your comment by saying when you look at the next 12 months, it really is amazing what's going to happen in that time period. So we're turning on the green hydrogen platform, which is going to have a substantial impact.

We're scaling the gigafactory and turning it on and going to have a full year of production out of that. We're scaling the new products. I mean Andy talked about the growth of electrolyzer. With our internal use as well as external sales, that's going to grow tenfold next year.

We've got other new products in EV and stationery scaling next year. We've got the joint venture scaling next year. We've got two acquisitions we've just made that are meaningful, both in terms of sales and margin and synergies on our existing spend of products and capex. We've got all the service improvements that we've been talking about.

It's really -- and we're scaling the material handling business and it's going to be growing over 30% to 40% next year. So the next 12 months are going to be another -- Craig mentioned a few minutes ago how big last year it was. I think the next 12 months are going to be equally exciting and big in terms of the growth of the company. We're guiding over 80% growth over this year.

And then you tack on all of these margin initiatives, they're going to have meaningful impact. Those are all baked into our guidance and why we're extremely excited about the projections and how we're going to get to that 30% run rate in the midterm strategic planning horizon.

PJ Juvekar -- Citi -- Analyst

Great. Thank you and I'll pass along.

Andy Marsh -- Chief Executive Officer

Great. Thanks, PJ.

Operator

Our next question comes from the line of Eric Stine with Craig Hallum. Please go ahead.

Eric Stine -- Craig-Hallum Capital Group -- Analyst

Hi, everyone.

Andy Marsh -- Chief Executive Officer

Good evening, Eric.

Eric Stine -- Craig-Hallum Capital Group -- Analyst

Good evening. So just as we think about the 2022 guidance, I mean obviously, you characterize your business as accelerating. Just curious if you're able to break down maybe the impact of the Frames acquisition, how much of it is just ongoing acceleration in your business. And then as we think about Frames, how do you kind of prioritize that internal initiatives versus going after what is arguably a very sizable market opportunity?

Andy Marsh -- Chief Executive Officer

Sure. So if you look at it, the internal business, organic growth is 50825 next year, Craig. We're looking at frames and Applied Cryo Tech to move it up into the 925 range. That's kind of how I think about it.

What was the second part of the question? I'm sorry, Craig, I was just jotting -- what was that -- what we say the second part of your question, Craig?

Eric Stine -- Craig-Hallum Capital Group -- Analyst

Yeah. So it was simply just prioritizing. Obviously you're acquiring this because of what it means for your internal business, but you've also got a big pipeline. I mean can you prioritize those too.

Andy Marsh -- Chief Executive Officer

Well, it's actually why one of the biggest challenges, as you know, for companies that are growing is employees. And having the right staff and the right number of people, by year-end, we'll have 2,500 people. Pre COVID, I was under 700. So I've had this massive increase.

And look, we've been hiring skilled individuals. We've been acquiring companies to help us really ramp and reach the needs. When we look at prioritization Sanjay has self -- his whole organization -- I was reviewing over the weekend with the team the layout of the plant in New York; that was developed by his team exclusively. He has the skill sets integrated into his business unit and this was a key decision we made as an organization that we're going to make these business units very, very self-sufficient.

And Sanjay has the team and really Sanjay, I don't think, needed additional resources to execute on our present plans. All these teams and electrolyzers, Frames will primarily support that activity. Obviously, we will help when we can with Sanjay, but that's really how we really have these business units, be it Jose's material handling business or Keith's new markets business, we try to keep them as self-sufficient as possible. Obviously, areas like -- there are certain areas of platform development for technology, which is centralized, finance and legal, government affairs but that's really how we go about managing the business.

These GMs we've put in place, quite honestly, all of them are very, very strong. And can -- our goal is that they will be the drivers to make sure these businesses are successful. Paul, would you like to add to that?

Paul Middleton -- Chief Financial Officer

I think that covers it, Andy.

Andy Marsh -- Chief Executive Officer

Yeah.

Eric Stine -- Craig-Hallum Capital Group -- Analyst

Yes. OK. And maybe just last one for me. Just on the stack upgrades.

I know you mentioned that you're going to do those at the 10 largest users. Just thoughts on what the cost of that may be and then thoughts of, is this something that we should view as kind of an ongoing initiative and to do that more broadly across your customer footprint.

Andy Marsh -- Chief Executive Officer

Sure. I'm going to let Paul take that one.

Paul Middleton -- Chief Financial Officer

I didn't get the context of the question.

Andy Marsh -- Chief Executive Officer

We're talking about, Paul, the services we've talked -- the service costs associated with the upgrade of the products.

Paul Middleton -- Chief Financial Officer

Sorry, I missed that. Yes. I think we've launched a new stack system. We launched it last year.

We've seen how that's performed in the new units that we've launched since that time. We've put a number of new units into the field. It's tracking incredibly well. It's actually tracking better than what we anticipated.

So as we continue to roll that back into our existing fleets, which we can fairly easily retrofit, it has a meaningful step function change in the stack life, which is one of -- it's obviously the biggest cost and impact on our service costs. So we're really -- and along the way this year, we've actually added a number of new resources and people to help focus go-forward reliability and improve that curve even faster and that's paying dividends in what we're doing. So I think you're going to see those benefits roll out fairly quickly.

Andy Marsh -- Chief Executive Officer

And Paul, we have a lot of that cost already accrued for.

Paul Middleton -- Chief Financial Officer

Yes, exactly. We have it baked into our cost accruals of the increments of the overall portfolio of what it takes to get there.

Operator

[Operator instructions] Our next question comes from the line of James West with Evercore ISI. Please go ahead.

Andy Marsh -- Chief Executive Officer

Hi, James.

James West -- Evercore ISI -- Analyst

Hey, Andy, how are you?

Andy Marsh -- Chief Executive Officer

How are doing? OK.

James West -- Evercore ISI -- Analyst

Andy, you've been a busy man. I'm glad you have Sanjay and the rest of your team and Paul to help you out that you're at the top of the element.

Andy Marsh -- Chief Executive Officer

Yeah. James, I was up 25 hours straight. That's not meant for -- that's meant for young people, but I'm still energized. I'm at 25 hours now.

James West -- Evercore ISI -- Analyst

Good. Good. Glad to hear it. Maybe a question probably for Paul.

As we think about the 2025 guidance and Andy, you touched on some of this, the moving parts where you think your electrolyzers get better, bigger than materials handling and green hydrogen eventually gets bigger as well. What should the revenue mix of that $3 billion or so look like when we get to '25? How are you guys thinking about that?

Paul Middleton -- Chief Financial Officer

Yes. I don't have the exact numbers in front of me. But in terms of the $3 billion, I think, as Andy said, electrolyzers are as big, if not slightly bigger, than material handling. And so those -- that coupled with the green hydrogen are the big three chunks of the revenue.

We're certainly seeing growth in the new markets on stationary and EV as well but the majority of revenue will come from those three pillars.

Andy Marsh -- Chief Executive Officer

James, no one's asked me this on the phone so I'm going to put it in. Talking about new markets. One of our goals with Renault is that we do rollout of 10 -- essentially 10 customers with rollouts next week -- year to demonstrate technology. They won't be big rollouts.

We already have seven customers lined up. So I think you may have seen me driving the van at the Plug Power Symposium. But we've -- that, to me, if -- Craig asked the question earlier, what surprised me, I think -- from last year. I think next year, at this time, I'll be talking about what we're doing with that Renault JV.

James West -- Evercore ISI -- Analyst

Right. OK. OK. Good.

And then maybe just the last one, if I could sneak it in here. The green hydrogen sales that you're anticipating as these facilities come online, do you believe that you'll have presold most of your capacity?

Andy Marsh -- Chief Executive Officer

I'm going to let Mr. Sanjay take that.

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

So James, good to hear from you. So look, I mean today, we have not done your traditional way of how I think the industry is done, right? You presold the plant, then you decide to build it, right? So as we sit here right now, is the plan completely sold out? No, it's not, right? But frankly, that's somewhat intentional on our part right now because of all the new applications, all the new opportunity that we see unfolding here. So we want to make sure that we're actually really reserving that capacity, right, which is also why we've gone down the path of essentially making sure that we're actually building these plants with our own capital so that way you're not having to go down the path of project financing and having to have that long-term offtake and things like that, right? So again, but this is something we'll obviously shift focus on, make sure that the plants are loaded up as they come online, right? But today, that's the approach we're taking to make sure that we have that reserve capacity to support all the new apps that we anticipate unfolding over the next several years.

James West -- Evercore ISI -- Analyst

OK, got it. Thanks, guys.

Andy Marsh -- Chief Executive Officer

Thanks, James.

Operator

All right. Thank you. Our next question comes from the line of Greg Lewis with BTIG. Please go ahead.

Greg Lewis -- BTIG -- Analyst

Yes. Thank you and good afternoon, everybody.

Andy Marsh -- Chief Executive Officer

Hi, Greg.

Greg Lewis -- BTIG -- Analyst

Yeah. I was hoping to dive in a little bit more into how we should think about the kind of the buckets of what's driving the margin improvement in terms of as we think about -- maybe it's pricing, maybe it's an improvement in the supply chain, maybe it's economies of scale. I mean you touched on the Frames and the ACT acquisition. Maybe some of that's internal savings.

Any kind of broader strokes we can think about and how we're achieving that 2022 and 2023 improvements?

Paul Middleton -- Chief Financial Officer

Yes. I think we've been...

Andy Marsh -- Chief Executive Officer

Why don't we let Sanjay do hydrogen? And Paul, you can answer the rest.

Paul Middleton -- Chief Financial Officer

Yes.

Andy Marsh -- Chief Executive Officer

And maybe you can run through hydrogen first.

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Sure. Happy to do that, Andy, right? So Greg, again, I think as I briefly mentioned to one of Craig's questions on hydrogen, right, so today, we're obviously buying hydrogen other than our plant in Tennessee, right? So we're paying what we're paying. That's the market price obviously impacted by various commodity price fluctuation and things along those lines, right, with the goal that make sure customers have hydrogen available all the time. So their mission-critical work and application is not impacted.

And as we look into 2022, we see couple of things that are going to have a meaningful impact to this margin profile. First, the Tennessee plant is no longer 6.4. It will be 10 tons a day. That will have an effect in the first half of the year.

We're obviously working with our strategic suppliers and adding few more supply options that is going to help us from a pricing perspective in the first half of the year. But when you go to the second half of 2022, as some of these green hydrogen plants come online, that will obviously help quite a bit from the blended price perspective. And that's why we said you should expect to see that meaningful margin improvement from Q4 of this year to Q4 2022. As you then go into 2023, where, by the end of 2022, we plan to have about four of these hydrogen plants basically being commissioned, right, so by the end of 2023, we're looking at having about six hydrogen plants up and running.

So when you look at '23 with all that contribution of new plants being built in the second half of 2022, you're looking at a breakeven margin performance. Then you shift into 2024 and beyond, where we're targeting and we're looking at -- which we've shared with you all multiple times, that we expect green hydrogen cost to be below $4 a kilogram. You guys can back into what our ASP is today. Obviously, that's a function of various different end markets, plus and minus, depending on which application it is but it gives us a very good confidence and the visibility based on where we see the costs going to talk about this 30% margin that we referred to, especially in 2024 for our hydrogen business.

Paul?

Paul Middleton -- Chief Financial Officer

Yes. And in the letter, we included a chart there that shows, to Sanjay's point, we're reducing it by 50%. I mean that's fundamentally step change function. And I would just add, to Sanjay's comment, that not only are we going to be able to produce it and sell to our customers at a cheaper cost, having -- as Sanjay alluded to earlier, getting -- gaining greater control over the logistics and the network is incredibly impactful on the efficiencies of the systems.

We have become the world expert on distributing hydrogen and managing the networks for our customers. And so one of the incredible things that we've learned is the importance of managing that logistics network and how that can be impactful to the efficiency of the system. So just to step back, to answer your question, it really stems from kind of three things, really. One is hydrogen, which Sanjay talked about.

Second is service, which we've talked about tonight in terms of a lot of things we're doing and we expanded on the latter and improving that profile. And the third is scaling the equipment programs. We've already shown routinely margins on our equipment profile at 30% to 35% as we scale further material handling as well as scale these new products like electrolyzers. I mean a tenfold increase next year in volume in that business is substantial.

And at a scale where as we start leveraging the gigafactory and other things that we're doing, it's going to allow us to achieve that margin profile on all the equipment programs that we have. And as that holistic business grows and we're talking about total growth next year of 85%, that's very meaningful in terms of the mix and the margin impact for equipment. So it's really those three fundamental things. And the acquisitions and the JVs and all those things help, on a global basis, grow the scale of equipment sales which allow us to drive that curve even faster.

Greg Lewis -- BTIG -- Analyst

OK. That was super helpful. And then just -- I wanted to talk a little bit more about ACT and in thinking about -- I mean hey, this was a -- it's a good company, good technology, maybe a little bit undersize prior to the acquisition. But I guess now that it's inside the Plug umbrella, what are the -- what's the kind of the thought process? And Andy, you mentioned that it's the hard -- one of the harder issues is getting the right people in place to do this.

But as we think about the opportunity for ACT in '22 and '23, as you look at how Plug is going to grow, I mean you guys are growing like a weed, is ACT in and of itself where it needs to be to meet your growth or should we be thinking about things like hydrogen trailers and everything else that ACT does, we're going to have to continue to rely on third-party providers as well?

Andy Marsh -- Chief Executive Officer

Greg, I expect to buy most of my trailers from ACT, Applied Cryo Technologies. I also expect that we will -- hydrogen trailers are much more complicated than stationary hydrogen tanks. This year, I probably purchased 65 stationary hydrogen tanks. I see this as a huge margin opportunity for Plug Power as well as a potential sales opportunity.

And with their technology, we're going to be able to move in to even further vertically integrate the business. We look at what we have down there. We're working one shift at the moment. There's no reason we can't expand the number of shifts and expand the capability.

We have the land. I've already been staring at and looking to see where we could add additional capability on the site. We've had a lot of outreach from some of our -- some of their customers already now that plug with our stronger balance sheet and ability to support the effort the business is much more interesting. So we're -- we view that as very complementary to our vertical integration strategy.

but also see that we could double or triple the size of that business in the coming years.

Greg Lewis -- BTIG -- Analyst

OK, great. Thank you all very much for the time.

Andy Marsh -- Chief Executive Officer

OK. Thanks, Greg.

Operator

Thank you. Our next question comes from the line of Bill Peterson with J.P. Morgan. Please go ahead.

Bill Peterson -- J.P. Morgan -- Analyst

Hi. Good afternoon.

Andy Marsh -- Chief Executive Officer

Hi, Bill.

Bill Peterson -- J.P. Morgan -- Analyst

Andy and the team, hope all is well there it sounds like you might be jet lagged. Hopefully feel better soon.

Andy Marsh -- Chief Executive Officer

Well, I feel good. I feel good, Bill. Just talking to you guys, get me going.

Bill Peterson -- J.P. Morgan -- Analyst

OK. Well, you certainly sounded excited about the electrolyzer business talking about how it could be even larger than some current businesses. I'm actually wondering about 2022. At the recent symposium, you mentioned 100 megawatts in external sales and 300 megawatts for your internal use.

And can there be more upside to this or is this capacity limited? I guess, are you fully booked through '22? And are you starting to get close into 2023 now?

Andy Marsh -- Chief Executive Officer

I believe that we will blow out the 2022 electrolyzer numbers that I suggested at the symposium. We are not overbooked because we've built a big factory. And I -- knowing the deal flow and the activities we have going on, I could see us during our update call in January for 2022, I think there's a high probability we'll be increasing that number.

Bill Peterson -- J.P. Morgan -- Analyst

That's terrific. I want to talk about EV's logo. We didn't spend too much time on this. I guess with your -- with Renault, you have, obviously, some light commercial duty.

This is an area that sees well suited for BEV. So I guess I'm kind of curious to what you see as advantages for this fuel cell. And maybe switching to more heavy -- medium or heavy duty. I believe a few quarters ago, you had talked about your being in negotiations for maybe some partnerships in heavy duty.

I'm wondering where this stands. I think you expected to maybe make some announcements, but is this still on track and would you take kind of an OEM approach here or just do direct sales? I'm curious on what your activities are more in the medium and heavy-duty side.

Andy Marsh -- Chief Executive Officer

So there are some real good negotiations going on, Bill. Let me say that I'm not eager to be an OEM parts supplier. Ultimately, that is a low-margin business. We're looking for and we're engaged in discussions to have relationships that look very similar to the Renault model, where Plug jointly owns the vehicle.

I probably agree with you that obviously, heavy-duty and medium-duty vehicles are very interesting. But when you look at work that's been done by people like DHL and you look at the European goals for delivery vans, DHL always points out, if you go over 200 kilometers, which is often needed at fuel cell vehicles, they're essentially carrying batteries around instead of packaging. I also think that fuel cell vehicles and I think this is understated, gives operators a great deal more flexibility to keep vehicles on the road and to use vehicles for multiple purposes. Now as I say kind of in this call that -- if this year electrolyzers surprised me, I think next year, I'll be talking a lot about vehicles.

Bill Peterson -- J.P. Morgan -- Analyst

OK, great. Thanks for that.

Operator

Thank you. Our next question comes from the line of Jed Dorsheimer with Canaccord Genuity. Please go ahead.

Andy Marsh -- Chief Executive Officer

Hi, Jed. Are you there Jed?

Operator

Jed, you may be muted.

Jed Dorsheimer -- Canaccord Genuity -- Analyst

Yes, yes. I'm muted. Sorry, guys. Andy, hope you get some rest.

It sounds like an incredible couple of days, so look forward to hearing about it. I guess what's that?

Andy Marsh -- Chief Executive Officer

Yeah, I look forward to talking to Jed.

Jed Dorsheimer -- Canaccord Genuity -- Analyst

Thanks. I guess first question and I just have a couple here. But with the updated guidance and maybe Paul gave this already or you gave this, Andy, what's the breakdown of revenues in terms of material handling in the near term here? So of the 900 to 925, what would that be in terms of the different end markets?

Andy Marsh -- Chief Executive Officer

Do you want to take it, Paul?

Paul Middleton -- Chief Financial Officer

Yes. I don't think we've given that out specifically, but I think Andy just kind of said 825 is our core businesses and moving to the 925 million is with the acquisitions. So I mean I think what we have given has been a number, I think, we quoted it with electrolyzer next year being around 150. I think looking at material handling kind of growing in that 30%-plus range next year, if not higher.

That's the guidance and insights that we've kind of given so far.

Andy Marsh -- Chief Executive Officer

So it would be about material handling about 600, 150 from electrolyzers and I've already probably said could be more. New markets, 75, acquisitions, 100. I think that gets us there, Paul.

Paul Middleton -- Chief Financial Officer

That's about right.

Jed Dorsheimer -- Canaccord Genuity -- Analyst

That's helpful, guys. And then just over on the -- I was wondering if you could help me a little bit just on the math because it sounds like there's a variable that I'm missing in terms of maybe a big step function on the cost down on the electrolyzer or the efficiency. But if I look at getting a kilo of green hydrogen, it's about 65-kilowatt hours of electricity to get that kilo in liquefied form. So is that a fairly constant number to use or do you see that dramatically changing? I guess that's my first question.

The second is then if we apply sort of a $0.05 cost of behind-the-meter electricity, I still struggle to get to under $450 million of cost.

Andy Marsh -- Chief Executive Officer

So Jed, I'm not paying -- I'm paying below $0.031 pretty much everywhere OK and almost approaching $0.025 of places. I think your analysis is kind of right. You can kind of think about the electrolyzers as 52 kilowatt hours. You can probably think of 11 to 12-kilowatt hours to be liquefied today.

I think you probably can start thinking about liquefier is getting down in the 8, 8.5 kilowatt hour range and probably electrolyzers, you probably can see 7%, 8% improvement over the coming two years or so. But I think that, Jed, you hit it on the head. It's the cost of how you negotiate the cost of electricity is the key to providing low-cost green hydrogen. And as you know, Sanjay is really an expert at that.

Jed Dorsheimer -- Canaccord Genuity -- Analyst

Well, Sanjay is a master negotiator. I guess, either you or Sanjay. I guess the question on that lower level of electricity pricing, particularly from renewables, have you figured out, is that really a mechanism of curtailment that you're taking into account to get those prices or is there anything you might be able to add other than Sanjay's negotiating skills?

Andy Marsh -- Chief Executive Officer

I'll let Sanjay answer that question.

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Yes, it's not the curtailed power, right? But you do bring up a really interesting point. And as you know, today, to be able to really access that curtail electricity even whether it's ITC or PTC, there's a lot more negotiation that has to go on, right? So I think it becomes more challenging from that perspective. But going forward, that could be an interesting area where you could, in fact, see even a benefit from a cost of renewable electricity. But today, look, these are new plants, right? And you've lived this, Jed, in the past and also still now, right? Every time you've seen the new generation of whether it's solar or wind or new capacity is being built, LCOE has gone down, right, because driven by the capex, driven by the cost of capital.

And look and I think Andy has given you some sense of what the numbers are. I don't want to go too much more detailed on that, right? I think we do want to preserve some of that from a competitive standpoint, but these are the numbers and that's why we have said what we said about what do we think is going to be the cost of our green hydrogen.

Jed Dorsheimer -- Canaccord Genuity -- Analyst

Got it. Well, listen that super-helpful. I will jump back in the queue. Thanks, guys.

Andy Marsh -- Chief Executive Officer

Got it.

Operator

Thank you. Our next question comes from the line of Tom Curran with Seaport Research. Please go ahead.

Tom Curran -- Seaport Global Holdings -- Analyst

Andy, I'm still picturing you in a conference room and sold and almost said good morning. Returning to the North American green hydrogen generation build-out, so you're expecting to exit 2022 with four plants that collectively will be producing 70 tons per day. And then as you turn to 2023, you expect to exit there with six representing 200 tons per day. At this point, just for the exit points of 2022, 2023, Sanjay, could you share with us the percentage of that output that you expect to be looking for third-party offtake? In other words, do you already have the visibility and whether it's a percentage or it's a range, for how much of that 70 tons per day you'll be looking to contract by the end of '22 and then how much of the incremental 1.30 million by the end of 2023?

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Yes. So that's a really good question, right? So let's take them first on 2022. And look, as you know, right, we are obviously the largest user of liquid hydrogen in North America and we have many new applications, right, that we're seeing a lot of traction on. That is going to create.

And some of these numbers you guys might not necessarily put together, if you would, for that incremental demand that materializes. But the typical rule of thumb, right, the way we want to think about it as these plants come online, we want to make sure that the 80% or so of that capacity is called for, right? We want to make sure that there is about 20% buffer. Why is that important, right? Maybe even 25% buffer, given what we've seen here so far, right? Because there's always an event that happens in the industry. We want to make sure that we have that excess capacity to be able to support our customer and, frankly, the entire hydrogen industry, right? So we'll be talking to you guys a lot more as we go into second half of next year, how we have loaded these plans for -- that are coming online.

And we'll talk to you a lot more about it and again, 2023. But one thing that I think is really important to keep in mind, right? When you think about material handling industry, it's 1 kg per day of consumption, right? Then you go to light commercial vehicle, that's 6 kilogram. You go to stationary power and if it's 24/7, it's more than a ton per day, right? So the multiply effect that you see for this hydrogen demand given all the application we're working on is pretty substantial. So frankly, as we sit here right now, we're not super concerned about loading the plants.

We want to make sure that we're balancing how we load this plant. So there is some buffer to be able to mitigate and deal with any type of a situation or curtailment or force majeure that the industry might face so that we can really support the entire hydrogen economy, our customer and frankly, even some of the other players in this market.

Tom Curran -- Seaport Global Holdings -- Analyst

Great. That's helpful. And then turning to new markets and one of the new markets that hasn't gotten much love yet thus far in the call, stationary power, data center backup power. Andy, you mentioned that you're expecting 2022 to be the inflection year for fuel cell mobility and in particular, the Renault JV.

What year does it look like could be the inflection year for stationary power?

Andy Marsh -- Chief Executive Officer

Good questions. I think actually, I haven't thought about that way, but now you've given me a new model to talk about. I think it's -- I do think it's 2023 between what we're doing with SK, what we're doing with data centers, the work Keith and his team were doing to get products out the door now. I think 2020 -- I think next year is a big testing year.

I think 2023 is where this starts taking off.

Tom Curran -- Seaport Global Holdings -- Analyst

Thanks for taking my questions.

Andy Marsh -- Chief Executive Officer

Thanks.

Operator

Thank you. Our next question comes from the line of Pearce Hammond with Piper Sandler. Please go ahead.

Pearce Hammond -- Piper Sandler and Company -- Analyst

Good afternoon and thanks for taking my questions.

Andy Marsh -- Chief Executive Officer

You're patient, Pearce.

Pearce Hammond -- Piper Sandler and Company -- Analyst

Yes. Well, I'll try to be quick. I guess my first question, just following up on all the questions on hydrogen, this is probably more of a housekeeping question. So with the customers in hydrogen delivery, do you simply pass along your hydrogen cost to the customers or do you have to wear the hydrogen price risk or is that the customers?

Andy Marsh -- Chief Executive Officer

So Pearce, with our new network when we control everything, that issue goes away. At the moment, as Sanjay talked about, we're buffering some of this because we want the hydrogen economy to be successful. That's what we're doing. And look, let me tell you the difference between the network Plug's running and the network that you may see in California, that one of the large industrial gas companies' providing.

We actually make sure hydrogen at this site every day, one time to keep operations going. And in the end, we strongly believe our approach of having share and then being able to substitute with our green hydrogen and I can tell you the fact that we're dependable, reliable and have provided stable pricing is going to be a great incentive in the future. And I can tell you in some discussions to displace some of the incumbents.

Pearce Hammond -- Piper Sandler and Company -- Analyst

Thanks, Andy. I appreciate the answer. And that's it for me.

Andy Marsh -- Chief Executive Officer

OK. Thanks, Pearce

Operator

Thank you. Our next question comes from the line of Joseph Spak of RBC Capital Markets. Please go ahead.

Andy Marsh -- Chief Executive Officer

Hello, Joseph.

Joseph Spak -- RBC Capital Markets -- Analyst

Hey, Andy. Look, I know you guys are building this business to be profitable and to sort of stand on its own. But going back to sort of the green hydrogen and bringing the molecule cost down by 20% by the end of next year, I want to confirm that, that doesn't include any PTC. And then if we were to consider that, what would the cost go down to? And do you have like an internal sensitivity as what that could do to demand and profitability?

Andy Marsh -- Chief Executive Officer

Absolutely. Do you want to take that, Sanjay?

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Sure. Happy to do that, Andy. Joe, good to hear from you as well. Look, I think first part of your question, no, we have not baked the PTC into that, right? And look, obviously, I think it's a very important policy not just for the U.S.

but also for the entire hydrogen economy and as a part of the energy transition effort, right, hydrogen has to be a part of that mix and green hydrogen has to be a part of that mix. But as we've told you that and we gave you a number of 30% gross margin, right? And that is based on what the ASP is in the market today and what we expect the cost of higher green hydrogen could be by 2024 time frame. And if you were to have $2 or $3 of production tax credit depending on the structure of, is it PTC, is it cash grant, you could certainly see substantial cash generation potential out of that, right? But look, things like this are super critical, though. This is exactly what got the wind energy and LCF to where it is right now, investment tax credit in solar got the solar industry to be where it is right now.

So we see a similar benefit for the green hydrogen as well from PTC. But to your question, for 2022, that margin expansion does not take that into consideration.

Joseph Spak -- RBC Capital Markets -- Analyst

OK. But if we did, it sounds like your 24 or 25 targets can be maybe pulled forward by a couple of years?

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

I think that would probably be a fair characterization, yes.

Joseph Spak -- RBC Capital Markets -- Analyst

OK. And then the second question is just there's, I've pointed out numerous times, a lot going on here and Plug itself is doing a lot of organic investment, a bunch of JVs, a bunch of partnerships, a bunch of M&A. I think it sometimes gets a little bit hard to judge the efficiency of maybe how you choose to sort of spend your capital. I think, Andy, your comments earlier that it doesn't make sense for you to be -- go make some sense.

But if you could just shed a little bit more light on like how you approach a given situation within the hydrogen economy as to sort of whether you do that organically via a venture or via an acquisition.

Andy Marsh -- Chief Executive Officer

I think that's -- so I think when you think of that, how we think about ventures, I think a lot about sales channels. And if you think about the Renault JV, it provided us -- in theory, I could have gone into the vehicle business. Renault has two distinct advantages that we could not develop over the next three to four years and even longer. One is their electric vehicle capability.

The other is their long customer reach and reputation in Europe. They provide us instantaneous credibility. We have the same -- what we bring to the table, obviously, there is we actually know how hydrogen ecosystems work. And so I wasn't going to walk into Europe and be European tomorrow.

I wasn't going to walk into Korea and be Korean tomorrow. But let's talk about SK. Why would we do it with SK? Not only is it a partnership, it's a market. They have the hydrogen.

They have the policy in Korea that allow us to put stationary products at scale. We could not do that alone. When I think about the acquisitions we make, have made, many of them have been technology-oriented to fill in the hydrogen ecosystem. If you think about every one we've done, ones that many in the audience may not remember here, Selex, which allowed us to get into material handling; AFC, which got us in the membrane business; EnergyOr, which is the aviation platform business that we have, what we've done with Frames is really strengthen our electrolyzer technology.

Giner brought electrolyzers to stack to the equation. So if I kind of look at -- I would say that the partnerships and ventures are probably more sales channel-oriented, while the acquisitions are more technology-oriented so that we can serve every element in the hydrogen ecosystem. I hope that was helpful, Joseph. 

Joseph Spak -- RBC Capital Markets -- Analyst

Yeah, thanks. I appreciate that color.

Andy Marsh -- Chief Executive Officer

On that note, I think we're done here as far as questions go. I appreciate everyone's patience who called into this call. Look, we're building something really special here. We are the company -- I was at COP.

And I was invited to meetings which I never would have been invited in the past, sitting there with John Curry side by side, talking about the hydrogen ecosystem. Plug's invited to these meetings because not only are we talking about it, you can see we're doing it. And we are the company that if you want to build an electrolyzer system at scale, no one else that has the manufacturing capability to do that. If you want a full range of fuel cell solutions from stationary to on-road vehicles, Plug actually makes systems that are complete, not just components.

This is a unique company. And I shouldn't forget the hydrogen, green hydrogen network we're building out. We're doing it. We've broken ground.

Plants will be online third, fourth quarter. This isn't a pipe dream in PowerPoint. This is real engineering, real people, 2,500 of them now who are making this business real. So thank you all for listening and I look forward to talking to you in January for our business update call.

Operator

[Operator signoff]

Duration: 72 minutes

Call participants:

Teal Hoyos -- Director of Marketing and Communications

Andy Marsh -- Chief Executive Officer

Colin Rusch -- Oppenheimer and Company -- Analyst

Sanjay Shrestha -- General Manager, Hydrogen Energy Business

Craig Irwin -- ROTH Capital Partners -- Analyst

PJ Juvekar -- Citi -- Analyst

Paul Middleton -- Chief Financial Officer

Eric Stine -- Craig-Hallum Capital Group -- Analyst

James West -- Evercore ISI -- Analyst

Greg Lewis -- BTIG -- Analyst

Bill Peterson -- J.P. Morgan -- Analyst

Jed Dorsheimer -- Canaccord Genuity -- Analyst

Tom Curran -- Seaport Global Holdings -- Analyst

Pearce Hammond -- Piper Sandler and Company -- Analyst

Joseph Spak -- RBC Capital Markets -- Analyst

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