WASHINGTON, May 14 (Reuters) - The U.S. Energy

Department on Tuesday said it has offered a conditional loan

guarantee of up to $1.66 billion to Plug Power Inc ( PLUG ) to

help it build up to six plants to produce clean hydrogen.

The hydrogen fuel from the plants is expected to power fuel

cell-electric vehicles used in material handling,

transportation, and heavy industry, the department's office of

loan programs said.

It is expected to result in an 84% reduction in greenhouse

gas emissions compared to conventional hydrogen production,

which derives hydrogen from natural gas, releasing large amounts

of the main greenhouse gas carbon dioxide, unless captured and

stored underground.

The administration of President Joe Biden believes that

low-carbon hydrogen can fight climate change by fueling heavy

industry such as aluminum, cement and steel and long-haul

transportation.

"Today's announcement will help unlock the full potential of

this versatile fuel and support the growth of strong,

American-led industry," the Department of Energy's Loan Programs

Office said in a release.

The clean hydrogen plants will use Plug Power's ( PLUG ) technology -

called electrolyzer stacks - manufactured at the company's

factory in Rochester, New York. Plug Power ( PLUG ) is one of the top

U.S. commercial-scale manufacturers of electrolyzers.

Clean hydrogen can be produced with electrolyzers powered by

wind and solar power, nuclear, or natural gas with carbon

capture, that split water into hydrogen and oxygen.

Today the vast majority of hydrogen is produced with fossil

fuels with unabated emissions, at a fraction of the cost of

clean hydrogen.