Top Canadian hydrogen stocks to watch

• Canada is attracting major multi-billion-dollar electric vehicle (EV) battery plants and hydrogen plays a major role, given the “prefect storm” of factors
• Hydrogen has emerged as a promising fuel alternative with immense potential because of its versatility and zero-emission qualities
• Canada boasts a significant advantage in hydrogen production because of its abundance of natural gas and renewable energy resources
• Given Canada’s significant spodumene lithium reserves – the largest in the Americas – and its solid support from all levels of government, it’s evident why it has secured large investments from investors seeking to cash into the EV transition

Canada is attracting major multi-billion-dollar electric vehicle (EV) battery plants and hydrogen plays a major role, given the “prefect storm” of factors.

In recent years, the world has witnessed a shift towards sustainable energy sources as the global community acknowledges the urgent need to combat climate change.

Clean energy solutions have become key drivers of economic growth and environmental stewardship.

Among these solutions, hydrogen has emerged as a promising fuel alternative with immense potential because of its versatility and zero-emission qualities.

A very flexible fuel for a combustion engine, Hydrogen has a more versatile “green” application as a clean fuel source used to power hydrogen fuel cells, which could potentially be an attractive alternative to traditional electric vehicles.

As ranked by Bloomberg, Canada has already surpassed the United States with its EV battery supply chain.

Given Canada’s significant spodumene lithium reserves – the largest in the Americas – and its solid support from all levels of government, it’s evident why it has secured large investments from investors seeking to cash into the EV transition. In this article, we will explore the rise and potential of Canadian hydrogen stocks, as the country positions itself at the forefront of the “hydrogen revolution.”

The Canadian advantage in hydrogen production

Canada boasts a significant advantage in hydrogen production because of its abundance of natural gas and renewable energy resources.

The country’s extensive natural gas reserves, combined with its vast wind and solar potential, provide a solid foundation for hydrogen production through the process of electrolysis.

This production method involves splitting water molecules into hydrogen and oxygen using electricity, with the preferred source being renewable energy.

Canadian companies are eager to capitalize on these resources to produce green hydrogen, contributing to the decarbonization of various sectors.

Collaborative efforts meet government support

Recognizing the strategic importance of hydrogen, the Canadian government has made substantial commitments to foster its development.

The Hydrogen Strategy for Canada, launched in December 2020, outlines the roadmap to develop a domestic hydrogen sector, with the goal of making hydrogen a key part of Canada’s energy system by 2050.

Additionally, various federal and provincial incentives, grants and partnerships are catalyzing investments in hydrogen infrastructure and research and development projects.

This collaborative approach ensures that Canadian hydrogen stocks are well-supported and poised for growth.

5 Top Canadian hydrogen stocks

As the hydrogen sector gains momentum, several Canadian companies have emerged as key players in the industry. Some noteworthy hydrogen stocks include:

1. Ballard Power Systems (TSX:BLDP)

Ballard Power Systems (TSX:BLDP) (Market Cap: $1.69 billion) produces fuel cells that enable the adoption of electric vehicles. Ballard Power Systems’ zero-emission fuel cells enable the electrification of mobility, including buses, commercial trucks, trains, marine vessels and stationary power.

Ballard and Ford Trucks are developing a hydrogen-fuel-cell-powered vehicle prototype.

Ballard will supply a fuel cell system as part of the partnership, which includes an initial purchase order for two FCmove-XD 120 kW fuel cell engines that are planned to be delivered by Ballard to Ford Trucks later this year.

Ballard Power Systems Inc. last traded at C$5.49 per share.

2. First Hydrogen (TSXV:FHYD)

First Hydrogen (TSXV:FHYD) (Market Cap: $179.41 million) is a Vancouver, B.C., and London, U.K.-based company focused on zero-emission vehicles, green hydrogen production and distribution and supercritical carbon dioxide extractor systems.

The hydrogen EV stock has received Rivus’ vote of approval from fleet manager Rivus for its hydrogen-fuel cell powered vehicle.

First Hydrogen last traded at $2.30 per share.

3. DynaCERT Inc (TSX:DYA)

DynaCERT Inc. (TSX:DYA) (Market Cap: $68.49 million) manufactures and distributes carbon emission reduction technology along with its proprietary HydraLytica Telematics, a means of monitoring fuel consumption and calculating GHG emissions savings designed for the tracking of carbon credits for internal combustion engines.

The company has formed a specialized team, the “dynaCERT Green Freight Program Task Force,” to assist all of its Canadian dealers and their clients that seek to realize the financial advantages of the recently launched Stream 2 of the Green Freight Program of Natural Resources Canada. The Green Freight Program provides funding assistance to qualified purchasers.

DynaCERT last traded at $0.18 per share.

4. Loop Energy Inc. (TSX:LPEN)

Loop Energy Inc. (TSX:LPEN) (Market Cap $17.00 million) is a developer and manufacturer of hydrogen fuel cell solutions designed for commercial vehicles, including transit buses and medium to heavy-duty trucks. It specializes in zero-emission transportation, electric power systems and fuel cells.

The Vancouver-based company was recently selected to supply fuel cell systems for a new fire truck platform by an established specialty vehicle original equipment manufacturer with significant global presence operating in 14 countries.

Loop Energy was last trading at $0.53 per share.

5. Charbone Hydrogen (TSXV:CH)

Charbone Hydrogen (TSXV:CH) (Market Cap: $4.01 million) develops modular and expandable hydrogen facilities. Through the acquisition of hydropower plants in the United States and Canada, Charbone will be able to produce green dihydrogen molecules using reliable and sustainable energy to distinguish itself as a provider of an environmentally friendly solution for industrial and commercial enterprises.

The company has been changing its development and deployment strategy to refocus all of its technical and financing resources from hydropower production to green hydrogen.

Charbone Hydrogen Corp. last traded at $0.06 per share.

Honourable mentions

Cummins Inc. (NYSE:CMI): Its subsidiary, Mississauga-based, Hydrogenics Corp. specializes in fuel cell systems for clean power generation and hydrogen electrolysis.

The company has a diverse product portfolio, including fuel cell power modules for utility-scale applications and hydrogen fueling stations for passenger and commercial vehicles.

Enbridge Inc. (TSX:ENB): As one of Canada’s leading energy companies, Enbridge has recognized the potential of hydrogen and is actively investing in this sector. The company aims to blend hydrogen into existing natural gas networks, demonstrating its commitment to a low-carbon future.

Opportunities and challenges

While the future of hydrogen stocks in Canada appears bright, there are challenges to overcome. The high cost of producing green hydrogen, limited infrastructure, and the need for supportive government policies are among the hurdles.

However, Canada’s commitment to decarbonization, coupled with its strong technological capabilities and natural resources, positions the country favorably to seize the opportunities presented by hydrogen.

Investment corner

Canadian hydrogen stocks are poised to play a pivotal role in the transition towards sustainable energy solutions.

With government support, collaborative efforts, and an abundance of natural resources, the country is well-positioned to become a global leader in hydrogen production.

As the world intensifies efforts to combat climate change, investing in Canadian hydrogen stocks may prove to be a smart choice, enabling environmental stewardship and financial growth.

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