Names in the hydrogen fuel cell space are taking a hit in Thursday’s premarket activity. Shares of FuelCell Energy (NASDAQ:FCEL), Plug Power (NASDAQ:PLUG) and Bloom Energy (NYSE:BE) look headed for a second day of losses as broader index futures are also in the red.
What’s contributing to the alt-fuel declines? Two possibilities from our read of the landscape.
One is a move by Nordics firm TECO 2030 that could shake up the nascent hydrogen fuel cell market. The Copenhagen-based firm said yesterday that it will establish Norway’s first large-scale production of fuel cells, optimized to be the heart of hydrogen-powered ships and other heavy-duty installations.
Hydrogen industry trade news site H2 View reported that Austrian engineering company AVL, which holds “more than 150 patents within the fuel cell industry” will help plan and build the facility. It could be interpreted that AVL’s involvement reduces the likelihood of licensing technology from any U.S. fuel cell providers.
The second possibility, though less likely, is fallout from the blame game going on in Texas as Republican Gov. Greg Abbott and several of his predecessors falsely claimed that renewables are responsible for the electricity crisis that has shut down much of the state. Abbott appeared on Fox News yesterday to talk about the disaster. There, he mocked the Green New Deal, a progressive plan that proposes sizeable investment in renewable energy.
Hydrogen Stocks Gained on Biden Expectations
Less than a month ago, hydrogen stocks were on the move as investors prepared for Joe Biden to take office. The new administration has made green energy one of its key goals, with a focus on fuel cells and the industries surrounding them. Ahead of Biden taking office, the Department of Energy announced plans to invest in hydrogen. That includes $160 million in federal funding that will focus on the research and development of the technology.
Those stocks has seen end-of-the-year action after Congress included an extension of clean energy tax credits in the $900 billion relief bill connected to the novel coronavirus on Dec. 21. Seemingly, with hydrogen holding as the most abundant element in the universe, investors saw potential.
All three of the above-mentioned stocks — PLUG, FCEL and BE — were among the 7 Hydrogen Stocks to Buy for the Future of Travel covered by InvestorPlace contributor Lou Carlozo in his round-up last month. He noted that action in hydrogen stocks “will of course run concurrent with the further development of an industry still in its initial stages of rapid growth.”
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, following fintech, agtech and property tech startups.