Plug Power stock shock has OHH board eyeing options

The company building a hydrogen plant near Graham announced last month that it may not have enough capital to continue in business but local officials and a representative for the company said the plant is still moving forward.

Anticipated tax revenue of about $6 million from the Plug Power hydrogen plant factored in a decision by Olney Hamilton Hospital to sell $33 million in general obligation bonds to fund a new hospital. Voters approved the bond measure in the Nov. 7 election, with the assurance that revenue from the Plug Power facility and windfarms would pay off the bonds without the need to raise taxes on property owners in the cities of Newcastle and Olney.

Three days after the election, Plug Power’s stock dropped nearly 30 percent after the hydrogen fuel cell maker filed a “going concern” notice, indicated that its performance was affected by “frequent force majeure events” and “unprecedented” supply challenges in the North America hydrogen network.

“The company is projecting that its existing cash and available for sale and equity securities will not be sufficient to fund its operations through the next 12 months,” Plug Power said in a statement. The Lathan, New York-based company also said it was pursuing alternate means to fund construction of planned hydrogen plants, including corporate debt and a loan program run by the U.S. Department of Energy.

Plug Power sent a representative to meet with the Graham City Council last week to assure the City that “the project is still moving forward,” Graham Mayor Alex Heartfield said.

Olney Hamilton Hospital’s board of directors also discussed the situation at their recent finance committee meeting, OHH Board President Dale Lovett said. The OHH board has not heard from Plug Power since the stock meltdown last month, he said.

“We had this discussion months ago and Newcastle did the same thing,” Mr. Lovett said. “If Plug Power doesn’t go through, what are we going to do with the balance of our bond debt? And months ago we said, if this is what happens, then we either seek alternate funding or we phase in stages of our building program so that we spead out the financial impact.”

The City’s architect will design the plans so that project managers can break the hospital construction up into stages, he said. “There are financial alterations we can make and there are building alterations we can make,” Mr. Lovett said. “Our experts are still working on all of that. We want the best outcome for them and for us.”

Work on transmission lines near the project site has continued, Mr. Lovett said.

Plug Power could not be reached for comment.