The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Sadly the companies and individuals desperately trying to cling onto their way of life are doing a good job of twisting the vocabulary such that they can apply it to themselves. I'm seeing it a lot with the nuclear industry who regularly call themselves 'clean', when they should really use 'low carbon' (they are most certainly not clean). Others are claiming 'green' hydrogen for themselves when they use 'renewable natural gas'. Today I read that Tesla has been kicked out of an ESG index and a pile of Oil companies have been added to it. The waters are muddying and I think we're entering a free-for-all phase. This is going to get really dirty. If we thought it was going to be a clean fight and an obvious choice for companies to pick ITM's products, we need to think again. Surely it's more important than ever for GC and team to not sit back and wait for business to come to them. They should recognise now, before it's too late, that it's now dog eat dog.
Following their article yesterday, they're now hosting an opposing article of doom and gloom.
https://www.telegraph.co.uk/business/2022/05/20/frances-big-bet-hydrogen-doomed-fail/
"The electric, battery driven car is widely seen as the vehicle of the future."
"Hydrogen is an unproven technology. The infrastructure for fuelling vehicles is woefully inadequate and unlikely to get any better."
"Elon Musk, the Tesla founder, who can justifiably claim to know a bit about this stuff, only last week described hydrogen as “the most dumb thing I could possibly imagine for energy storage”."
Curiously, the few that I read in the comments sections were all pro-hydrogen and informing Matthew Lynn that his article was poorly researched.
Self-congratulatory claptrap. UK leading the world? Hmm. Plug Power get an order for 1GW whilst BAIS still think testing and competitions are needed to prove the technology is viable. All the while we continue to tie ourselves to the British government, and their delusional view of the state of play in this field, the further behind we will drift. Europe are building 100's of refueling stations. Fortescue is building GW scale generation. And Plug Power are out to win every order they can lay their hands on. GC and ITM need to wake up.
This has got to sting for ITM. Presumably this was on ITMs radar. If not, why not? It's in Europe. And it's gone to a PEM solution. ITM had better come up with something big soon to show us they're not just waiting in the wings.
Maybe the news is finally starting to sink in over the pond. Plug up 11%. Personally I think a 1GW order is worth a little more, but I suppose I am a little biased. I wouldn't be surprised if it catches up a bit this week.
Now what is ITM going to offer in response. They should be ashamed of themselves if they can't get a factory-sized order over the line. They've been at this longer than Plug Power.
https://www.ir.plugpower.com/press-releases/news-details/2022/Plug-Lands-1-GW-Electrolyzer-Order-with-H2-Energy-Europe/default.aspx
...I thought I'd better spell it out for those who only read the headlines.
I remember someone on this forum once thought that Plug weren't competition for ITM as they were unaware of Plug's entry into the electrolyser market, specifically PEM. Check this out...
https://www.ir.plugpower.com/press-releases/news-details/2022/Plug-Lands-1-GW-Electrolyzer-Order-with-H2-Energy-Europe/default.aspx
I'd hate to be the one trying to make sense of those statistics...
44%-59% would pay more for a property, but 64% also think they should be cheaper. How do you square that circle?
Also from the Telegraph.
"Kwasi Kwarteng has told households to prepare for energy bills to rise further as part of plans to fund the cost of new nuclear power plants.
The Business Secretary has said the government's bid to boost Britain's nuclear output will have a "small effect" on energy bills as ministers replace Chinese investment with a new funding model."
Snip from the Telegraph.
"Natural gas is to be classed as a “green” investment by Kwasi Kwarteng as the Government scrambles to increase North Sea production in a move that risks inflaming tensions with climate campaigners.
Mr Kwarteng, the Business Secretary, is understood to be keen that drilling for the fossil fuel is listed as “environmentally sustainable” in a new classification of activities being drawn up by his department and the Treasury to guide investors."
There's one thing that still puzzles me about the gas grid. Once you've put gas into the grid, how do you get it out again without simply pushing more gas in at one end (vast simplification!). I mean, can you ever have an empty gas grid? What's inside it if it's empty - a vacuum? - air? It's not really a store if you can't use it without putting even more into it first. Gas storage and usage isn't my area of expertise. Can somebody help me?
I'm glad this is starting to be written about. Most people seem unaware how quickly this problem scales with additional renewables capacity. Many people seem to think that it only becomes a problem once your renewables are generating more than your entire annual demand, as if that's the oversupply. They need to be educated that potential oversupply occurs on an minute by minute basis, resulting in hours and days of overcapacity, which if not stored is just lost and wasted. In my opinion wasting energy is FAR worse than inefficient conversion (the ever-present argument against green hydrogen).
Nel's Q1 results seem like a strong performance to me...
Q1 Revenue NOK213m (up 36% YoY)
Order backlog NOK1.3bn (up 19% YoY)
Top five FEED studies in progress include three projects circa 750MW in Europe.
Based on the fall in hydrogen stocks we've been seeing, I think all those running away from hydrogen stocks right now are running in the wrong direction. The companies keep reiterating their 2025 expectations for the scale of the opportunity so we've only got 2-3 years to see whose right...that's really close. For context, Plug Power restated their expectations for '23, '24 and '25 on Monday. Basically they're both saying the same thing, so either they're both wrong or the market doesn't get it yet.
I hope ITM have found some way to make their numbers bullish next month so we can start to drag this negative market back around.
Nel's Q1 results still seem a strong performance to me...
Q1 Revenue NOK213m (up 36% YoY)
Order backlog NOK1.3bn (up 19% YoY)
Top five FEED studies in progress include three projects circa 750MW in Europe.
Based on the fall in hydrogen stocks we've been seeing, I think all those running away from hydrogen stocks right now are running in the wrong direction. The companies keep reiterating their 2025 expectations for the scale of the opportunity so we've only got 2-3 years to see whose right...that's really close. For context, Plug Power restated their expectations for '23, '24 and '25 on Monday. Basically they're both saying the same thing, so either they're both wrong or the market doesn't get it yet.
"Plug’s 2021 acquisition of Frames Group, headquartered in the Netherlands, further supports our
goal to reach an installed electrolyzer capacity of three gigawatts by 2025. Plug continues to
combine its world-class stack technology with Frames’ systems integration capabilities to deliver
a range of turnkey electrolyzer solutions from 1MW containers to 1GW standalone plants."