The Top 11 Hydrogen and Fuel Cell Stocks To Buy in 2022

Hydrogen stocks had a bad year in 2021 and a bad start to 2022, but green hydrogen is as topical as ever and valuations may be more attractive going forward. Here are 11 green hydrogen and fuel cell stocks to consider in 2022.

SustainFi   Updated June 5th, 2022

Should you invest in green hydrogen?

According to the International Energy Agency, hydrogen supplies only 1% of the world’s energy needs today. But that may be set to change. According to the Hydrogen Council, hydrogen could contribute over 20% of global energy demand by 2050.

Here is why.

Hydrogen can help solve problems created by the transition from fossil fuels

Hydrogen could be the solution to some of the unique challenges posed by the transition from fossil fuels. Although solar and wind power are cheaper than fossil fuels in many places, these renewables remain intermittent, seasonal, and weather-dependent. We need ways to store energy from solar panels or wind turbines for when the sun isn’t shining or the wind isn’t blowing.

And lithium-ion batteries, already used to power electric cars, remain too heavy for heavy-duty trucks, airplanes, and ships. Although batteries have gotten much better over the past decade, their range remains limited and they take a long time to charge.

Enter green hydrogen. Hydrogen is a very light, colorless gas that can be used to store energy, as a fuel for trucks, planes, and ships, and even to heat homes and power industrial processes like steelmaking. Hydrogen is three times lighter than jet fuel, and the only by-product of burning it is water. Hydrogen-powered vehicles can be filled up at hydrogen charging stations like normal cars; there is no need to wait.

How to make green hydrogen

However, hydrogen needs to be made before it can be used. To produce hydrogen, companies use electrolyzers that split water molecules into oxygen and hydrogen. For hydrogen to be “green,” electrolyzers need to be powered by renewables like wind or solar, not by fossil fuels. Today that is not the case. According to the International Energy Agency, only 1% of hydrogen is currently made using renewables. Hydrogen can also be “brown,” i.e., produced using coal, “gray” or produced using natural gas, and even “blue,” if carbon capture is used.

Green hydrogen remains expensive, but costs should fall

The cost of green hydrogen, especially compared to natural gas, has been the biggest barrier to adoption.

Luckily, the cost of renewables is dropping, making green hydrogen cheaper. Although green hydrogen remains expensive today, costing between $3/kg and $6.55/kg (compared to only $1.8/kg for fossil fuel-based hydrogen), with low-cost renewables, prices could eventually drop to $1.5/kg.

Besides, government policies in the U.S. and the European Union promote green hydrogen. The U.S. Department of Energy Earthshot Initiative aims to lower the cost of clean hydrogen by 80% in one decade, to only $1/kg. And the Infrastructure Bill included $9.5 billion in funding to speed up the development of clean hydrogen technology.

How do you invest in green hydrogen?

Most publicly listed hydrogen companies make fuel cells, which convert hydrogen into electricity, leaving water and heat as by-products. Some listed companies also sell electrolyzers, which make hydrogen out of water.

Hydrogen and fuel cell stocks list

  • Plug Power (PLUG)
  • Bloom Energy (BE)
  • FuelCell Energy (FCEL)
  • Ballard Power Systems (BLDP)
  • McPhy Energy (MCPHY)
  • Nel ASA (NLLSF)
  • PowerCell Sweden AB (PCELF)
  • AFC Energy (AFGYF)
  • Ceres Power Holdings (CPWHF)
  • ITM Power Plc (ITMPF)
  • Hyzon Motors (HYZN)

Learn more about each company on the list.

1. Plug Power (PLUG)

  • Market capitalization: $10.3 billion

Plug Power makes hydrogen-powered fuel cells that can replace conventional batteries. Fuel cells can power anything from trucks, forklifts, and drones to back up power generators for data centers. Plug Power has already deployed over 50,000 fuel cells, largely powering forklifts for customers like Amazon, Carrefour, Home Depot, and Walmart. Walmart has partnered with PLUG since 2012, with a small pilot expanding to a fleet of over 9,500. Plug has also agreed to supply green hydrogen to the supermarket giant.

Plug Power’s long-term vision includes running its own green hydrogen plants and powering on-road electric vehicles. It has recent partnerships with the French car-maker Renault and the Korean EV maker Edison Motors. The company is guiding to $900-$925 million in revenue in 2022, up 90% over the prior year, and $3 billion in 2025.

Although Plug Power is far from profitable, it has over $10 billion in market cap. PLUG shares have been very volatile – despite a great 2020, 2021 and 2022 were not great.

2. Bloom Energy (BE)

  • Market capitalization: $3.3 billion

San Jose, California-based Bloom Energy sells fuel cell-powered servers that generate electricity onsite. According to the company, the servers (that look like giant refrigerators) can convert natural gas, biogas, or hydrogen into electricity without emitting much carbon. Electricity generation is reliable, constant (24×7), and uninterrupted, besides being clean and sustainable. Bloom Energy’s customers include Bank of America, Coca-Cola, and Google.

In 2020, Bloom Energy announced that it would start making hydrogen-powered fuel cells and electrolyzers for green hydrogen production. The company has also clinched a $4.5 billion power supply agreement with South Korea’s SK Group. Bloom Energy even has a partnership with Samsung Heavy Industries to develop fuel cell-powered ships.

However, despite its promise, BE is still far from profitability.

3. FuelCell Energy (FCEL)

  • Market capitalization: $1.5 billion

Connecticut-based FuelCell Energy makes fuel cell power plants. Their SureSource plants serve large power users like utilities, municipalities, universities, and hospitals. The SureSource Hydrogen plants can convert natural gas or biogas into hydrogen, used to produce power and heat or as fuel for transport.

Depending on the input, hydrogen produced may be gray or green. The company proposes carbon capture to reduce emissions if natural gas is used as an input.

FuelCell is also developing solutions for long-term hydrogen-based energy storage. Long-duration energy storage could balance out intermittent energy supply from renewables like wind and solar. The company has $1.5 billion in market cap, generating roughly $70 million in revenue in both 2020 and 2021, though it remains unprofitable.

4. Ballard Power Systems (BLDP)

  • Market capitalization: $2.2 billion

Based in Canada, Ballard Power Systems makes hydrogen fuel cells for cars, trucks, forklifts, ships, trains, and buses. Its fuel cells can also be used for backup power generators. The company has partnered with Tata Motors in India to make electric buses, Talgo S.A. for trains, and Hydrogene de France for hydrogen power plants. However, exciting partnerships aside, Ballard only made $104 million in 2021 sales.

5. McPhy Energy (MCPHY)

  • Market capitalization: €445 million

Founded in 2008, French company McPhy develops hydrogen electrolyzers and hydrogen refueling stations. By mid-2022, McPhy had installed over 191 MW of electrolyzers and 95 hydrogen stations. The company has three development centers in Europe, mostly selling to customers in the region. The business is still early-stage: McPhy had €13 million in 2021 revenues.

6. Nel ASA (NLLSF)

  • Market capitalization: $2.3 billion

Norway-based Nel ASA is a pure-play hydrogen company listed on the Oslo Stock Exchange. Nel makes hydrogen electrolyzers and fueling stations. It is the world’s largest electrolyzer manufacturer, having delivered over 3,500 units to over 80 countries since 1927. It has also shipped 120 hydrogen fueling stations to 14 countries. The company generated about $80 million in 2021 sales.

7. PowerCell Sweden AB (PCELF)

  • Market capitalization: $780 million

PowerCell Sweden AB makes hydrogen fuel cells for vehicles, ships, planes, and onsite power generators. The company was founded in 2008 as a spinout from Volvo Group. In 2021, PowerCell announced partnerships with Robert Bosch GmbH (to power trucks and trailers), ZeroAvia (to develop fuel cells for planes), and Hitachi (for stationary power.) 2021 sales amounted to roughly $17 million.

8. AFC Energy (AFGYF)

  • Market capitalization: 196 million GBP

AFC Energy is a UK-based manufacturer of hydrogen fuel cells. The company targets electric vehicle, shipping, data center, construction, and rail markets. AFC has partnered with ABB to roll out EV charging systems. It is also working with ACCIONA, a construction company, to decarbonize its construction sites. AFC Energy started to report sales in 2021, though it is still the early days.

9. Ceres Power Holdings (CPWHF)

  • Market capitalization: 1.3 billion GBP

Another U.K.-based fuel cell technology company, Ceres Power makes SteelCell fuel cells that can generate power from conventional fuels like biogas or from renewables like hydrogen, biogas, or ethanol. The technology suits both established markets like heat and power for buildings and growth markets like electric cars and data center backup power generators.

In partnership with Weichai Power, Ceres has developed a low-emission range extender system for EVs. SteelCell technology is also being deployed to improve energy efficiency in data centers. The company is already making sales: Ceres Power reported 30 million GBP in 2021 revenues.

10. ITM Power Plc (ITMPF)

  • Market capitalization: 1.8 billion GBP

British electrolyzer maker ITM Power has just opened the world’s largest electrolyzer factory in Sheffield, the U.K. The company’s customers include Linde, Shell, Siemens Gamesa, Orsted, Scottish Power, and many more. The second U.K. electrolyzer Gigafactory is under construction, with an expected 2023 opening. ITM has also opened seven hydrogen refueling stations in the U.K. But, like other hydrogen stocks, ITM power generates minimal revenue at this point.

11. Hyzon Motors (HYZN)

  • Market capitalization: $1.4 billion

Hyzon Motors is an early-stage company that develops fuel cell-powered heavy trucks, coaches, and buses. Based in Rochester, New York, Hyzon Motors has delivered around 500 fuel cell-powered trucks in 2019 and 2020. The company has shipped dairy trucks and sewage trucks, among others. Hyzon’s parent company is the Asia-based fuel cell maker called Horizon.

🔔 Looking for hydrogen ETFs? Check out the top 3 ETFs that invest in hydrogen.

NOT INVESTMENT ADVICE. The content is for informational purposes only; you should not construe any such information as investment advice.

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Frequently Asked Questions

Can you invest in hydrogen?

You can invest in hydrogen by buying the stocks of companies that sell electrolyzers (used to make hydrogen) or hydrogen fuel cells that transform hydrogen into energy. If you don’t want to buy single stocks, you can also invest in one of the three hydrogen ETFs.

Is hydrogen worth investing in?

Hydrogen may still be worth investing in, even though hydrogen stocks had a bad year in 2021 and an even worse start in 2022. Hydrogen burns clean, without any carbon dioxide or other greenhouse gas emissions. As a result, governments in the U.S., China, and EU have announced programs to support hydrogen technology.

Besides, the cost of renewables like wind and solar, needed to produce carbon-neutral hydrogen, has come down. And hydrogen stock valuations in early 2022 look more attractive than in 2020.

Who is developing green hydrogen?

Dozens of public and private companies are developing green hydrogen technologies, such as fuel cells and electrolyzers. Examples of green hydrogen companies include Plug Power, Ballard Power Systems, FuelCell Energy, and Bloom Energy.