21 Sept 2023
Hydrogen, often referred to as the fuel of the future, is fast becoming a star player in the clean energy landscape. With the capacity to emit zero greenhouse gases when burned, hydrogen is emerging as a cleaner and more sustainable energy source compared to traditional fossil fuels. While the path to harnessing hydrogen's full potential is challenging due to production complexities and costs, several companies are working diligently to unlock its immense promise. In this article, we explore five top hydrogen stocks to watch as the hydrogen energy sector gains momentum.
Understanding Hydrogen Investing
Before diving into the top hydrogen stocks, it's essential to understand the nuances of hydrogen investing. Hydrogen can be produced through various methods, some of which result in the production of carbon dioxide, a greenhouse gas. Hydrogen derived from natural gas, for instance, is known as "blue hydrogen" and necessitates carbon capture and storage to mitigate emissions.
On the other hand, "green hydrogen" is produced through a process powered by renewable energy, resulting in zero carbon emissions. Hydrogen fuel cells generate electricity through an electrochemical reaction, offering a potential emissions-free fuel source. Although clean hydrogen holds tremendous promise, it remains costly to produce, with efforts to reduce costs ongoing.
5 Leading Hydrogen Stocks for 2023
Here are five top hydrogen companies to keep a close watch on as the industry continues to evolve:
1. Air Products (NYSE: APD)
Air Products is a global leader in supplying industrial gases, including merchant hydrogen. With over 100 hydrogen plants producing 7 million kilograms of hydrogen daily, Air Products is a significant player in the hydrogen fuel infrastructure. The company has committed to addressing global energy and environmental challenges, with a $7 billion carbon-free hydrogen joint venture in Saudi Arabia among its key projects. This ambitious project, set to be completed in 2025, is poised to produce 650 tons of hydrogen per day, positioning Air Products as a major player in the hydrogen energy sector.
2. BP (NYSE: BP)
BP, a prominent oil and gas producer, has set a bold goal to achieve net-zero emissions by 2050 or earlier. Hydrogen plays a pivotal role in BP's sustainability strategy, with plans to capture a 10% share of the hydrogen market in its core operating areas. The company is actively advancing hydrogen projects in the UK, Europe, the US, and Australia, including the development of the UK's largest blue hydrogen production plant and a significant green hydrogen production facility. These projects are poised to contribute significantly to the UK's 2030 low-carbon hydrogen production target.
3. Plug Power (NASDAQ: PLUG)
A pioneer in the hydrogen fuel cell industry, Plug Power has deployed over 60,000 fuel cell systems for e-mobility applications. The company is rapidly expanding its hydrogen refueling network in North America, with more than 180 fueling stations. Plug Power's ambitious vision includes building an end-to-end green hydrogen network capable of producing 2,000 tons of green hydrogen per day by 2030. This strategy positions Plug Power as a potential category leader in the green hydrogen market.
4. Bloom Energy (NYSE: BE)
Bloom Energy is on a mission to deliver clean, reliable, and affordable energy through its innovative Bloom Energy Server and Bloom Electrolyzer technologies. The Bloom Electrolyzer boasts exceptional efficiency in producing clean hydrogen, making it a game-changer for industries seeking to decarbonize. Bloom Energy's ability to pair its electrolyzer with renewable energy sources positions it as a key player in the green hydrogen ecosystem.
5. Linde (NYSE: LIN)
Linde, a global leader, has developed technologies for efficient hydrogen compression, safe refueling, and carbon emissions reduction through carbon capture and storage. The company's $1.8 billion investment in supplying clean energy to a large-scale blue ammonia plant in Texas demonstrates its commitment to advancing clean hydrogen. Linde's project, set to commence in 2025, aims to sequester over 1.7 million metric tons of carbon dioxide annually, further bolstering the hydrogen sector's sustainability.
Hydrogen: A Multitrillion-Dollar Market Opportunity
Hydrogen energy holds immense promise in decarbonizing heavy industry, replacing natural gas, and enabling the storage of renewable energy. With the potential to create a multitrillion-dollar market, hydrogen is a disruptive force in the energy sector. However, the industry must scale up and reduce costs to compete with traditional fossil fuels and emerging technologies like battery storage. As investors assess the hydrogen landscape, they should closely monitor which companies are best positioned to emerge as long-term leaders in this transformative field.