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Green hydrogen startup Verdagy is planning a second $150 million "multi-gigawatt scale" factory outside of California, Axios has learned.

Why it matters: The swift ramp-up shows how fast the green hydrogen market is moving. 

Zoom in: Last month Verdagy filed an application for tax credits for the Department of Energy's 48C program to support a planned factory that would produce electrolyzer systems. 

Verdagy CEO Marty Neese said that the second facility would help the company make more of the gear for the electrolyzer systems and help it stave off low-cost competition. "We're a young company, the clock is ticking," said Neese.

Neese said the company is eyeing the Gulf Coast, among other regions, for the new factory.

Next month Verdagy employees will start working out of its first manufacturing facility in Newark, California, which is supported with a $39.6 million DOE grant (pending negotiations). The company hopes to produce its first electrochemical cells at the facility in Q4 2024.

Catch up quick: Verdagy was born in 2021, using some of the tech and talent of Khosla Ventures' incubated company Chemetry.

The company raised funds from Khosla as well as Temasek, Shell Ventures, TDK Ventures, among others. 

Verdagy makes advanced alkaline water electrolyzers, which can be ramped up and down to pair with clean energy. Electrolyzers produce hydrogen and oxygen from water using electricity.  

Behind the scenes: Last month I visited the company's 2MW hydrogen production facility, in Moss Landing, Calif., which sits next to the world's largest energy storage project and a series of indoor cannabis farms. Monterey Bay's coast, where kayakers can paddle among otters and pelicans, is just down the road. 

Over a decade ago, the building was used by carbon-to-cement maker Calera, which went bust, followed by Chemetry. 

Today inside the building, a container-sized blue unit houses ten of Verdagy's cells, sandwiched together, producing hydrogen that is currently vented off. Metal pipes snake around the room moving liquids and gases. 

The company expects to have its first hydrogen plants under development in late 2025 or early 2026, likely starting with the green ammonia sector.  

The big picture: Verdagy is just one of hundreds of both young and established companies, like Plug and Electric Hydrogen, that are vying for the nascent green hydrogen market as companies and governments invest in clean energy.

What's next: The company is in a key phase of its growth as it tries to rapidly commercialize its technology and secure customers. 

Green hydrogen startup Verdagy plans new $150M factory

The company is trying to rapidly commercialize

Verdagy CEO Marty Neese stands in front of the company's green hydrogen plant in Moss Landing, Calif. 

Verdagy CEO Marty Neese stands in front of the company's 2MW hydrogen plant in Moss Landing, Calif. Photo: Katie Fehrenbacher/Axios

Hydrogen

Green hydrogen startup Verdagy is planning a second $150 million &quot;multi-gigawatt scale&quot; factory outside of California, Axios has learned.Why it matters: The swift ramp-up shows how fast the green hydrogen market is moving.

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Green hydrogen startup Verdagy plans new $150M factory

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