February 28, 2022 • Paul Rodden • Season: 2022 • Episode: 94
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In episode 094, Chevron wants to fill up your hydrogen car, the world's largest private investment and green hydrogen is announced, and some hydrogen stocks are looking really good. All of this on today's hydrogen podcast.
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Chevron wants to fill up your hydrogen car, the world's largest private investment and green hydrogen is announced, and some hydrogen stocks are looking really good. All of this on today's hydrogen podcast.
So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where is capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters who recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy capital. Those are the questions that will unlock the potential of hydrogen. And this podcast will give you the answers. My name is Paul Rodden and welcome to the hydrogen podcast.
On February 24, of 2022, Chevron USA, which is a subsidiary of Chevron Corp, and Iwatani Corporation of America, which is a wholly owned subsidiary company of Iwatani Corporation announced an agreement to co develop and construct 30 hydrogen fueling sites in California by 2026. As part of the agreement Chevron plans to fund construction of the sites which are expected to be located at Chevron branded retail locations across the state, the stations will initially fuel light duty vehicles while retaining the flexibility to serve as heavy duty vehicles over the long term. Iwatani will operate and maintain the hydrogen fueling sites and provide a hydrogen supply and transportation logistics services. Chevron plans to supply a portion of the fueling services with excess hydrogen production capacity at its Richmond refinery and future hydrogen production from pilot projects in Northern California.
In a quote from Andy Walz, president of America's fuels and lubricants for Chevron, Chevron believes that hydrogen has the potential to assist in lowering the carbon emissions of the transportation sector and other hard to decarbonize industries. We are excited to work with Iwatani to advance the entire hydrogen transportation value chain from production to consumer purchase, in order to help our customers lower their lifecycle transportation carbon intensities. And in a quote from Joseph Cappello chairman and CEO of Iwatani Corporation of America, this extensive collaboration between Iwatani, and Chevron demonstrates our shared vision and commitment to support the decarbonization of transportation. Together Chevron and Iwatani will establish one of the most robust, vertically integrated supply and infrastructure ecosystems in California and is a model that can be replicated to other markets. Okay, so not a big press release in terms of length and complexity, but a very important one.
Now, the truth be told, I'm not very surprised that Chevron is in this agreement. They're making a lot of smart moves when it comes to the energy transition. And this partnership with Iwatani fits well within other announcements I've seen from them recently. I'm also not surprised to see that this is starting off in the Richmond facility. I think before too long Richmond is going to be a huge hydrogen hub for California. It's centrally located in the state with plenty of infrastructure around it to expand and as anyone who has paid attention to the fuel cell EV market in California knows the biggest complaint of owners right now are hydrogen fueling stations. And with this announcement, the number of stations in California could nearly double. Next in another press release. HY24 Mirova CDPQ and Technip Energies join forces to make a record 200 million euro investment in green hydrogen, Pioneer Hy2gen AG. Now two things to note on this.
This is the world's largest private investment in green hydrogen, and capital will be deployed on E fuels to decarbonize industry and transportation sectors. Hy2gen AG, the green hydrogen investment platform on February 17, announced the successful completion of a $200 million investment round. The capital will be used for the construction of facilities in several geographies, including Europe, producing green hydrogen based fuels or E fuels for maritime and ground transport, aviation and industrial applications. The investment, which is the largest private green hydrogen focused capital raised to date, is led by HY24. Together with Mirova. CDPQ and strategic investor Technip energies. Cyril Dufau-Sansot CEO of Hy2gen said as early as 2021, we were looking for the best possible combination of financial and strategic investors to build E fuel production facilities. These have the potential to decarbonize entire industries and transport sectors. We are now very pleased that all parties have sealed the largest investment in the segment, Pierre-Etienne Franc, CEO of Hy24 said the magic combination for success in hydrogen scale up is sizable projects in strategic basins, strong stakeholder support from offtake to project financing and execution and the leadership of expert teams for development and steering.
This is what Hy2gen said has successfully gathered around the table. This is the first investment made by our clean h2 Fund allows HY24 to step into its role as a catalyst for hydrogen based projects at scale to foster the energy transition. Hy2gen founded in 2017, is a pioneer in the electrolysis of green hydrogen and its derivatives. The company is one of the leading players in the green hydrogen industry, with 880 megawatts in planning and construction and a further 12 gigawatts of projects in development. HY24 The world's largest clean hydrogen infrastructure platform is a joint venture between Ardian a world leading private investment house and FiveT Hydrogen and investment manager specializing purely in clean hydrogen investments. The Clean H2 Infra Fund managed by Hy24 with a billion euros raised intends to unlock strategic and large scale projects under development to accelerate the scaling up of hydrogen markets.
Raphaël Lance, Head of Mirova’s Energy Transition Infrastructure Funds said Mirova is committed to financing sustainable solutions for the energy transition. We are convinced that green hydrogen has a key role to play in the decarbonisation of the industry, and are proud to partner with Hy2gen and support their ambition to become a key player in the deployment of this energy of the future. Emmanuel Jaclot, Executive Vice-President and Head of Infrastructure at CDPQ said CDPQ is delighted to take part in our first green hydrogen transaction alongside trailblazers of this promising vector of energy, one of which has the potential to accelerate the decarbonization of highly polluting industries. With this investment in Hy2gen, we demonstrate our determination to bring concrete and pragmatic solutions to address today's environmental challenges. Arnaud Pieton, Chief Executive Officer of Technip Energies stated, We are partnering and investing in Hy2gen, a first mover developer in the green hydrogen value chain.
This will further strengthen our key market positioning in green hydrogen and its derivatives. This investment confirms the consistency of our partnership choices to deliver on our strategy. We look forward to contributing our engineering capabilities and our proven project delivery expertise to the concentration and acceleration of hydrogen projects. Okay, so a monster announcement for European hydrogen production. So for those of you that don't know about Hy2gen, it's based at a Wiesbaden Germany. They develop finance and build and operate plants for the production of green hydrogen and hydrogen based E fuels worldwide. Now, an E fuel is just another term for synthetic fuel. And the technology around this has been around for quite some time. It's also called fischer tropsch's fuels. And the beautiful thing about those is that they are more energy dense than traditional fuels, they burn cleaner and they weigh less. And these synthetic fuels really are the first step in decarbonizing traditional combustion engines. And once you have a synthetic gas or a syngas, and you move over to synfuels, you can really make just about any kind of liquid fuel there is gasoline, diesel and jet fuel.
Now, some other things to also keep in mind in this announcement is that a lot of these companies like Hy2gen and HY24 are backed by some very, very large corporations. And so that makes this announcement all the more impressive. And lastly, in an article from The Motley Fool, Howard Smith writes by Plug Power, Bloom Energy and Fuel Cell Energy stocks jumped the week of February 18. He writes, the stocks of several companies moving forward with hydrogen fuel cell development are having a good week, even with the overall markets in a bit of a downturn. The two things in fact may be related. Shares of plug power, Bloom Energy and fuel cell energy have all jumped that week. These names were up as much as between eight and 14% at their highs during the period. As of late trading on Friday. The weekly moves for these names were as follows Plug Power was up 4.1% Bloom Energy gained at 9.8% and fuel cell energy rose 8.6%.
So what does that mean? Investor enthusiasm for these names and others in the alternative energy sector began with some positive earnings news last week. Bloom Energy reported its fourth quarter and full year financial results last Friday. Investors in some analysts thought the results were a sign the company was on the right path. The fuel cell company told investors it expects to generate positive cash flow from operations in 2022. It also raised its long term 10 year revenue growth guidance by 500 basis points to an annualized range of 30 to 35%. It also helps these companies continue to focus on growing the hydrogen economy. Plug Power announced this week that has begun New collaboration agreement with two other hydrogen fuel technology companies to jointly develop hydrogen liquefaction plants. The agreement follows the recently announced acquisition by plug for Joule processing. Joule is an engineered equipment provider that will help the new plan for hydrogen liquefies. plexin In a statement, the proven cryogenic process technology that Joule developed for the gas processing industry is directly applicable to hydrogen liquefaction and has the potential to reduce the cost of liquefied hydrogen by 25%.
Investors haven't yet heard from plug power on its fourth quarter results, but fuel cell energy will be holding an investor day update on March 16. If it sounds as optimistic as Bloom Energy, it could provide another boost for stocks in the sector. Beside the longer term optimism for bloom, the company also increased its near term guidance by 10% that now sees 2022 revenue of at least $1.1 billion. Okay, so with this article being written on February 18, and me recording this on February 26. What does that mean today? Well, if we look at plug power, its stock took a dip after this article was written and lost about $4. That being said, over the last three days, it's gained most of that back. Bloom also had a drop after the article was written but not quite as severe as plug power. It not only regained its losses, but is sitting $1 higher than it did before the drop. So hopefully the fourth quarter results look good, and everyone can keep gaining.
Alright, that's it for me, everyone. If you have any questions, comments or concerns about today's episode, come visit me at my website at thehydrogenpodcast.com. Or you can always email me at email@example.com. I would really love to hear from you. And as always, take care. Stay safe. I'll talk to you later.
Hey, this is Paul. I hope you liked this podcast. If you did and want to hear more. I'd appreciate it if you would either subscribe to this channel on YouTube, or connect with your favorite platform through my website at www.thehydrogenpodcast.com. Thanks for listening. I very much appreciate it. Have a great day.