US hydrogen fuel cell and electrolyzer developer Plug Power has signed a non-binding Letter of Intent (LOI) with an unnamed US data center developer as part of a broader effort to strengthen its balance sheet and expand into the data center market.

Plug said that it expects to improve liquidity by more than $275 million through a mix of asset sales, cash releases, and cost reductions. As part of that plan, the company will monetize its electricity rights in New York and another US location, while partnering with the unnamed developer to explore using its fuel cell systems for backup and auxiliary power at data center sites.

Plug also reported that it is set to pause its participation in the US Department of Energy loan program and redirect capital to projects with faster returns, including commercial partnerships in hydrogen supply and power infrastructure.

“The actions we are taking today reflect Plug’s agility and financial discipline,” said CEO Andy Marsh. “Partnering on a large-scale data center development expands Plug’s reach into a dynamic, high-growth market that values reliability, resiliency, and sustainability.”

Founded back in 1997, Plug is one of the oldest hydrogen fuel cell manufacturers in the world. It produces a range of hydrogen-based products, including its stationary GenSure and ProGen fuel cell platforms, which typically range from 100kW to several megawatts, and its PEM electrolyzers, which range from 1MW to 100+MW.

The deal would mark the company’s first in the data center sector. However, fuel cells have seen significant uptake over recent years, driven mainly by the success of Bloom Energy, which has signed deals with Equinix, Oracle, and major US utility American Electric Power.

In October, Bloom signed a $5 billion AI infrastructure partnership with global investment firm Brookfield to support the deployment of its fuel cell technology across AI data centers worldwide.