Investing in Green Hydrogen in 2024: Opportunities Guide and Top Business Bets

Why is hydrogen a promising investment opportunity?

The global energy transition is accelerating the demand for clean and sustainable sources. Hydrogen is emerging as a key player in this revolution, especially in sectors where traditional batteries have limitations. Investing in green hydrogen represents a bet towards decarbonizing transportation and energy production, two fundamental pillars to contain global warming.

Unlike fossil fuels, hydrogen generates electricity through fuel cells without emitting greenhouse gases. The only residue is water and heat, making it a truly clean solution. This potential has captured the attention of investors and major global corporations.

How to invest in hydrogen: available pathways in the markets

Investing in green hydrogen differs significantly from investing in oil or other commodities. There is no official benchmark price for hydrogen in stock markets, so the main strategy is to choose shares of companies committed to this technology.

Specialized ETFs offer an interesting alternative. Funds like the Global X Hydrogen ETF (HYDR) and the Defiance Hydrogen ETF (HDRO) group the most relevant players in the sector into a single instrument, facilitating diversification.

The most active companies in this space include manufacturers of hydrogen vehicles, fuel cell developers, and infrastructure providers. Each occupies a different link in the value chain, allowing multiple ways to gain exposure to the sector.

Leading companies in green hydrogen: Investment options

FuelCell Energy: Pioneer in fuel cells

Based in the United States, FuelCell Energy leads the development of clean energy technologies. Its portfolio includes power plants and carbon capture solutions. The company specializes in electricity production through hydrogen cells, positioning itself as an industrial benchmark in this technological segment.

Fusion Fuel Green: Solar and hydrogen synergy

This company stands out for integrating solar energy with hydrogen-based electricity production. Its model allows charging storage systems during sunlight hours and releasing energy during low production periods. It is a comprehensive solution for continuous clean energy.

Linde: Global distributor of industrial gases

Linde is the world’s largest producer of liquid hydrogen. As a supplier of gases to countless industries—from aerospace to carbonated beverages— it controls a critical part of the hydrogen supply chain. Its global scale and dominant position make it especially relevant for investing in green hydrogen.

Toyota: Committed to fuel cells

The Japanese manufacturer not only develops cutting-edge electric vehicles but also strongly invests in hydrogen as a complementary solution. Toyota leads the segment of hybrid vehicles combining hydrogen with lithium-ion batteries, demonstrating confidence in this technology for the long term.

Hyundai: Korean pioneer in clean mobility

Hyundai launched the ix35 fuel cell in 2013, the first mass-produced model for automotive use. Since then, the Korean company has systematically expanded its commitment to hydrogen as a zero-emission fuel.

Hyzon Motors: Focus on accessibility

This US-based company develops affordable hydrogen fuel cells for commercial electric vehicles. Its mission is to democratize the technology through reduced costs, attracting considerable enthusiasm in the stock market for its innovative potential.

Daimler: Tradition of innovation

Daimler, globally known for Mercedes, was a pioneer with electric buses in 2006. Today, it continues manufacturing hydrogen buses and trucks, leveraging its experience in clean propulsion technology.

Advantages of green hydrogen in the energy value chain

Hydrogen offers significant advantages for certain niches of the energy market:

• Superior autonomy in heavy vehicles compared to current electric counterparts
• Zero CO2 emissions during operation
• Relatively accessible production through various chemical processes
• Ideal complementarity with lithium-ion battery vehicles
• Renewable energy storage in green production plants

Sector challenges and limitations

Hydrogen still faces significant obstacles:

• Complex and costly distribution infrastructure, similar to oil
• Lack of hydrogen refueling stations in most regions
• Technology in early stages with uncertain evolution
• Technical limitations not yet fully resolved
• Competition with electric vehicles in certain segments

Profitability outlook: 2024 and beyond

Most companies related to green hydrogen show positive stock performance, but with important nuances. Companies like Linde and Toyota, although both connected to hydrogen, follow different trajectories driven by different markets.

Before investing, it is essential to evaluate each company’s complete portfolio, not just its hydrogen exposure. Toyota and Hyundai are attractive because they diversify into EVs and cutting-edge technologies. Conversely, companies developing fuel cells will face competition where only some leaders will survive.

Future of green hydrogen: Role in the energy transition

The climate urgency guarantees a central role for hydrogen in the coming years. Governments worldwide are accelerating investments in green infrastructure, and freight and passenger transportation— the main source of emissions— requires immediate solutions.

Investing in green hydrogen addresses a structural need of the global energy system. It will coexist with electric vehicles in a combined effort to eliminate fossil fuels. Additionally, it will serve as a key ally of renewable energies, storing electricity during periods of overproduction and releasing it when needed.

Conclusion: Recommended investment strategy

Investing in green hydrogen is an attractive opportunity but requires careful analysis. The industry is not monolithic: producers, manufacturers, and suppliers coexist with different dynamics.

Investments in giants like Toyota, Hyundai, and Daimler offer greater stability because they diversify their technological portfolios. Specialized fuel cell companies carry higher risk but explosive growth potential if they manage to position themselves as technological leaders.

The key is to identify which of these companies will lead the transition. Those that succeed will multiply their value; those that fall behind will disappear from the market. This is the true challenge for those seeking to invest profitably in green hydrogen long-term.