SLINGERLANDS — With gasoline starting at a record $4.50 a gallon at nearby gas stations, Plug Power CEO Andy Marsh foresaw more than a new factory at his company’s ceremonial groundbreaking in Slingerlands on Tuesday.
He saw a path to climate-friendly energy independence with the hydrogen fuel cells his company will build there.
“I am wearing a yellow-and-blue tie,” Marsh said, referencing the colors of the Ukrainian flag, “and I think it says a lot about why we need alternative energy. Because without it we’re going to be dependent on the Russian gas station forever.”
President Biden on Tuesday announced a ban on importation of oil and natural gas from Russia in response to its brutal invasion of Ukraine. Biden said prices at the pump are likely to go higher as a result and there’s not much he can do about it immediately.
Plug Power will build, service and warehouse its GenDrive fuel cells in the new factory. The devices are used to extract electricity from the reaction of hydrogen and oxygen and power electrical material-handling vehicles such as forklifts.
Hydrogen fuel cells are proven performers in limited areas such as warehouses and airports. They will not be replacing gas and diesel engines in over-the-road vehicles on a widespread scale anytime soon, but they are one more piece of the solution as policy makers try to reduce use of carbon-based fuel.
The state of New York is trying to achieve carbon-neutral status on a very aggressive timetable. Gov. Kathy Hochul attended Tuesday’s groundbreaking ceremony and spoke in glowing terms about the factory’s anticipated environmental and economic benefits.
Its promised workforce is 1,633 people.
“Companies like Plug Power, you couldn’t have thought of this 25 years ago when you started thinking, how we can innovate new technologies to bring clean energy sources, to our construction vehicles and forklifts and all the other ways that you’ve been so brilliant,” Hochul said.
“But now you’re realizing it does have a profound effect. It allows us in the state of New York to meet our very ambitious climate goals, which are nation-leading. We’re ambitious, but we will meet our objectives because in my opinion, we have no choice. This is not about what we’re doing here on this rather chilly day. It’s what’s going to happen to our children and our children’s children going forward.”
Bethlehem Supervisor David VanLuven noted that the wind turbine tower fabrication plant planned on the Albany-Bethlehem border will have a workforce of 400, bringing a sudden influx of more than 2,000 green jobs to the town.
“That means Bethlehem will be one of the green energy hubs for the entire state of New York, I am so proud of that,” he said.
The 350,000-square-foot factory has a $55 million price tag and is targeted for completion this summer, with start of production Aug. 1. It will benefit from up to $45 million in Green Excelsior Jobs Tax Credits if it meets the workforce projection and may also receive an allocation of low-cost hydropower from the New York Power Authority.
Plug Power, which is based in Latham, will retain 701 existing jobs in Albany County as it hires staff for the Slingerlands campus.
Plug Power is on a long-running, sharply upward growth path, completing a series of acquisitions and building a series of new facilities, including what it says will be the largest liquid hydrogen plant in the world, in western New York.
The growth has come with a cost. Plug Power has never turned a profit in its 25 years as a publicly traded company, even as annual revenue jumped from $23 million in 2011 to $40 million in 2016 to $502 million in 2021.
Gov. Hochul noted during the ceremony that the state’s energy consumers “are always at the whim of geopolitical circumstances as we’re experiencing right now with the unlawful invasion of another country by Russia,” and said developments like Plug Power’s new plant will help change that.
AAA reported the average price for a gallon of regular gasoline in the Albany-Schenectady-Troy metro area was $4.41 Tuesday, the highest the organization has ever recorded.
The previous record was set a day earlier — $4.24 a gallon on Monday.
A significant portion of that price per gallon is taxes: Four flat state taxes totaling 33.35 cents, a flat federal tax of 18.4 cents, and a local sales tax that would be 18 cents on a $4.50 gallon of gas in a county with a 4% sales tax rate.
Speaking to reporters afterward, Hochul acknowledged the impact the gas price surge is having in New York and said she’d looked closely at the possibility of suspending the state gas tax, but there are problems with that idea.
“It could go up to $6 a gallon,” the governor said. “I don’t have any way to guarantee that the savings from not having to pay 10 cents, 18 cents, 20 cents per gallon is going to wind up in consumers’ pockets.”
Whatever was cut in gas tax would have to be made up elsewhere in the budget, at the same time she is trying to build a financial reserve for the next crisis, adjusting to the end of one-time assistance from the federal government and preparing for potentially diminished stock market gains.
“I’m also very cognizant of the fact that we could be facing a recession,” Hochul said.