What happened
Shares of hydrogen fuel cell stock Plug Power (PLUG 1.69%) jumped Monday morning and were up 10.8% as of 11:10 a.m. ET.
The pop was produced by something that Cummins (CMI 0.21%) announced today.
Image source: Getty Images.
So what
Plug Power produces fuel cell systems primarily for powering forklifts and similar commercial vehicles, although it has broader hydrogen ambitions, including the production of vans powered by fuel cells and even the hydrogen to fuel them.
So the bigger the global hydrogen economy gets, the better for Plug Power. And this morning, we saw another encouraging sign for hydrogen adoption when engine maker Cummins announced that it will sell an electrolyzer to produce hydrogen to power a taxi fleet.
Cummins is selling the 2.5-megawatt electrolyzer to hydrogen mobility company Hysetco, a joint venture among France's TotalEnergies (TTE 1.30%) and Air Liquide, Luxembourg's Kouros, and Japan's Toyota Motor (TM 0.22%). As Cummins explained, "the electrolyzer will enable local hydrogen production in Paris, France, to power Hysetco's ambitious project ... to create the largest hydrogen taxi fleet worldwide, fueled by 12 large hydrogen refueling stations, by 2024."
Now what
From one perspective, this isn't great news for Plug Power, which has ambitions to make and sell its own hydrogen to other companies, including those that use its fuel cells. Competition from Cummins won't necessarily help with that plan.
From another perspective, however, more hydrogen produced -- from any source -- should help to drive the cost of the fuel lower for everybody, and thus encourage sales of Plug's fuel cells.
It's that latter take on today's news that seems to be driving Plug Power stock higher.
