Jurisdictions around the globe are working to cut emissions and this has opened the door to a resurgence in hydrogen. Investors are banking on H’s potential as the chief alternative to vehicle’s consumption of fossil fuels.
In turn, hydrogen-linked stocks have risen like hot air to their highest levelsin nearly 10 years.
A major benefactor of this movement is Canadian clean energy company Ballard Power Systems Inc. (TSX:BLDP). Recently covered by Stockhouse Editorial’sfeature on “blue hydrogen”, BLDP is a designer, developer and manufacturer of fuel cell products for vehicles and generators. In January 2020, Ballard Power announced that its proton exchange membrane technology (PEM) had successfully powered Fuel Cell Electric Vehicles – or FCEVs – in commercial Heavy- and Medium-Duty Motive applications for an industry-leading cumulative total of more than 30 million kilometres, enough to circle the globe 750 times. Since the beginning of last year, its share price has risen 300%.
(BLDP Stock chart - Jan 2019 - Feb 2020)
This is a similar story told by US company Plug Power Inc. ( NASDAQ:PLUG ), who has also seen its shares jump just as high.
(PLUG Stock chart - Jan 2019 - Feb 2020)
In February 2020, PLUG announced a partnership with a global developer of zero-emission drivetrains - Colorado-based Lightning Systems. Under this collaboration, both companies will create the first electric, fuel cell-powered Class 6 trucks (up to 12.5 tons) in the world that will be capable of supporting middle-mile delivery logistics between warehouses and distribution centres.
The rally is happening overseas as well. London, UK-based fuel cell maker Ceres Power Holdings (LON: CWR) turns hydrogen and oxygen into electricity. CWR is one of the leading developers of fuel cell technology to produce clean and low-cost energy. Its flagship product - the Ceres SteelCell is a perforated sheet of steel with a ceramic layer that converts fuel directly into electrical power. Its SteelCell technology uses the existing infrastructure of mains natural gas and is manufactured using commodity materials.
Many investors are still wary of whether or not this hype is real, given hydrogen’s brief rally 20 years ago that left more of a “flavour of the month” taste in people’s mouths than a legitimate and viable option. But now, things seem to be quite different.
For example, a European consortium consisting of Royal Dutch Shell Plc (AMS: RDSA) announced its ambitious plan in February 2020 to create “green” hydrogen using power from a huge offshore wind farm.
Dubbed NortH2, the energy giant is joined by gas company Gasunieand Groningen Seaportswith a goal to produce 800,000 metric tons (882,000 tons) of hydrogen a year by 2040. This is a massive team-up that hopes to produce hydrogen within the next seven years.
In less than a decade, we could be seeing a drastic change in the energy landscape, which would not only have implications for climate change, but also how other energy producers would follow suit. What is your take on this energy revolution? Let us know in the comments below.
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