In December 2023, the global hydrogen pipeline expanded by 35%, reaching 1,400 projects amid economic challenges. These projects could total as much as $570 billion in investment by 2030, indicating strong industry growth. The shift from grey hydrogen toward clean hydrogen is expected to drive demand by 2050, creating substantial long-term investment opportunities in hydrogen stocks.
In 2024, U.S. Senators Cassidy, Crapo, Risch and Ricketts criticized the Biden administration’s strict 45V tax rule, which hinders U.S. hydrogen producers from qualifying for tax credits. If lifted, hydrogen stocks could see upward momentum. The senators argued that the current rule diverges from defining clean hydrogen straightforwardly. This could complicate renewable energy expansion for hydrogen production.
A revised policy could advance emission reduction goals, as hydrogen supports achieving net-zero emissions. Investors are urged to consider buying leading hydrogen stocks amid expectations for 45V reforms.
Here are three of the best bets in hydrogen stocks for those looking to take advantage of these trends.
Plug Power (PLUG)
Plug Power (NASDAQ:PLUG) presents a buying opportunity at the $2.30 level, supported by triple bottom levels from January. Recent developments included significant progress in Georgia and Tennessee plants, with a Louisiana joint venture with Olin (NYSE:OLN) nearing mechanical completion by Q3’s end. Additionally, the company signed new contracts for engineering and design packages (BEDP) in Europe and the U.S., bolstering its future prospects.
Recently, Plug announced a long-term partnership to kickstart the customer’s decarbonization efforts. This will start with a phased project featuring up to 2 GW of electrolyzer capacity. The initiative will deploy five 5 MW containerized PEM electrolyzers to reduce carbon emissions through green hydrogen. CEO Andy Marsh emphasized the market potential in Europe for green hydrogen to meet decarbonization goals, positioning Plug Power well to make a significant impact with its technology and industry expertise.
At the recent Hydrogen Insight Summit 2024, Don Boyajian, Plug Power’s director of government affairs, cautioned that U.S. regulators risked undermining the country’s green hydrogen subsidy program. He highlighted that proposed strict regulations on additionality, temporal and geographic correlation could inflate costs by approximately $2/kg. This would reduce the value of the $3/kg production tax credit.
Air Products and Chemicals (APD)
Air Products and Chemicals (NYSE:APD) is also a notable hydrogen stock. The company is breaking a $70 million expansion in its Missouri facility. The company supports the rising demand for biogas, hydrogen recovery, aerospace nitrogen, and maritime fuels. It aims for production by late 2025, adding 30 jobs to its current 170-person workforce.
Moreover, APD specializes in hollow fiber membrane separators and onsite gas-generating systems. The company develops, engineers and markets PRISM Membrane Separators and custom systems for various industries to enhance safety, sustainability and productivity globally.
Notably, TotalEnergies and Air Products agreed to a 15-year contract starting in 2030, supplying 70,000 tons of green hydrogen annually in Europe. The deal now supports TotalEnergies’ aim to decarbonize European refineries and reduce over 700,000 tons of carbon dioxide every year. Air Products will deliver the hydrogen supply directly to TotalEnergies’ Northern European refineries.
Bloom Energy (BE)
Bloom Energy (NYSE:BE) is one of the top-performing hydrogen fuel cell stocks to own. It closed at $13.32 this past week and recently outperformed the index. Analysts expect the stock to rise more in 2024. Its EPS is anticipated to come in at $0.05, with revenue reaching $314.75 million.
Although Bloom Energy is undoubtedly an energy stock, it is gaining traction due to the recent AI hype. The company offers solid oxide fuel cells (SOFCs) and hydrogen electrolyzers that produce clean on-site energy. Among its first adopters is tech giant Alphabet, deploying Bloom boxes as a power source in its headquarters.
RBC Capital (NYSE:RY) recently reiterated an outperform rating on BE stock with a $15 price target, noting Bloom’s fuel cell technology’s potential in data centers. BTIG also maintained a buy rating with a $21 target. This highlights Bloom’s recent contract with Intel (NASDAQ:INTC) for fuel cell services in Santa Clara, California, bolstering its presence in the data center market.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or
indirectly) any positions in the securities mentioned in this article.
