As the world ramps up its efforts to decarbonise the economy, hydrogen has emerged as a leading candidate, and investors are taking notice.

Hydrogen fuel cells can be produced using a range of different methods and store power produced by a range of different energy sources, including natural gas, nuclear and renewables like wind and solar.

And, when these fuel cells are used up, they release only water back into the environment.

In the past year, it has also captured the fascination of investors, according to OC Funds Management portfolio manager Rob Calnon.

“I don’t think anyone would disagree that over the last 12-18 months hydrogen has really come out of the pack as one way that we can decarbonise the global economy,” he said in a presentation for Reach Markets’ The Insider: Meet the Fund Manager series. 

“Green hydrogen itself has a very strong ESG focus which investors, asset consultants and the world more generally is really starting to focus on.”

“And there’s a lot of capital available for businesses that have hydrogen solutions, and governments globally – through grants or policy settings – are trying to encourage the development of the hydrogen industry.”

The Australian Federal Government has already pledged $1.2 billion in funding to grow the domestic hydrogen industry, and trying to get the cost of production below $2 per kilogram has been specifically listed as a stretch goal within the 2020 Low Emissions Technology Statement.

Prime Minister Scott Morrison expects Australia’s current hydrogen vision will create 8000 new jobs and contribute $11 billion per year to the GDP by 2050.

“Our plan to invest and develop low emissions industries will mean more jobs for Australian workers, particularly in our regions, cheaper energy for businesses and lower emissions,” he said.

“We are accelerating the development of our Australian hydrogen industry and it is our ambition to produce the cheapest clean hydrogen in the world, transforming our transport, energy, resources and manufacturing sectors.”

“This is good for jobs, good for our environment and contributes to our global effort to reduce emissions through technology not taxes.”

Meanwhile, the US Department of Energy has earmarked US$52.5 million to fund more than 30 hydrogen projects across the country and officials in the UK are looking to coax £4 billion from investors to fund its domestic hydrogen production.

Mr Calnon recently presented at our fortnightly ‘The Insider: Meet the Fund Manager’ session. You can watch a recording of the full session below, or you can click here to book into our next installment of the series.

Reach does not assume responsibility for the accuracy or completeness of any information provided, and the views expressed are not reflective of Reach Markets position. Any advice contained within this presentation is general advice and does not consider your personal circumstance, you should consider whether it’s appropriate for you. The information we are giving you is for educational purposes only. “Investing is about understanding your risk” and every time you invest in the share market there is a risk of loss.

Sources:

• The Interpreter: Australia’s place in a decarbonising world economy
• US Department of Energy: Hydrogen Fuel Basics
• US Department of Energy: DOE Announces $52.5 Million to Accelerate Progress in Clean Hydrogen
• Australian Government: Growing Australia’s hydrogen industry
• The Mandarin: PM promises future hydrogen will deliver more jobs