Recently, I’ve been looking into the hydrogen energy sector. Honestly, the market performance from last year to now has been quite interesting. Governments around the world are aggressively pushing carbon-neutrality targets. As a solution for clean energy, hydrogen has long been a darling of the investment community, and green hydrogen concept stocks are mentioned again and again.

Let’s start with the policy side. The U.S. Department of the Treasury recently released the final rules for clean hydrogen production, clarifying the tax credit policy that producers can enjoy—up to $3 per kilogram. This is a major positive for the entire industry because previously many companies had taken a wait-and-see approach toward investing in hydrogen projects. Now that the rules are clear, investment momentum has kicked in. The International Energy Agency’s report is also quite convincing, projecting that global hydrogen demand will reach 530 million tons by 2050. Taiwan has also planned hydrogen’s share of supply at 9%-12%. This shows that hydrogen is truly building momentum and getting ready to take off.

In terms of market size, the global green hydrogen market was only $1.1 billion in 2023, but it’s expected to grow at a compound annual growth rate (CAGR) of 61.1%, reaching $30.6 billion by 2030. This growth rate is indeed enticing. Last year, the world announced 1,418 hydrogen projects, with total investment of $570 billion—an increase of 31% compared with the year before.

At the company level, I’ve noticed several targets worth paying attention to. Air Products (APD), as one of the world’s largest commercial hydrogen suppliers, recorded a gain of 53.96% last year, and Wall Street analysts’ average price target is $362.31. Plug Power (PLUG) fell 55.17% last year, but as a pioneer in hydrogen fuel cells, it has already deployed 69,000 fuel cell systems and operates more than 250 hydrogen refueling stations in North America. BP, as a traditional energy giant, is also shifting its focus—planning to produce 500,000 to 700,000 tons of low-carbon hydrogen annually by 2030.

There are also many green hydrogen concept stocks active in Taiwan. Zhongxing Electric is building hydrogen refueling stations, and it expects 2-3 large refueling stations to be completed in 2025, with nearly NT$40 billion in orders on hand. Last year, revenue was NT$25.61 billion, up 15.65% year over year, reaching a record high. Goly is the main contract manufacturer for Bloom Energy’s fuel cell dust removal boxes. It expects low double-digit growth for its heat exchanger business in 2025, and the fuel cell dust removal box business is also expected to achieve high double-digit growth.

However, investing also depends on risk. Competition in the hydrogen industry is indeed intensifying, with new companies continuously entering the market, which creates pressure for leading firms. Plug Power, for example, has had its profits eroded by price wars. In addition, hydrogen production costs are still a problem. At present, production methods still rely mostly on fossil fuels, which limits the industry’s environmental benefits, and hydrogen prices remain closely linked to oil prices.

In terms of investment approaches, you can either buy green hydrogen concept stocks directly, or use contracts for difference (CFDs) to conduct short-term trading, or buy hydrogen ETFs to diversify risk. Personally, I believe hydrogen is definitely the direction of the future—but you need to pick the right targets, especially companies that have made tangible progress in green hydrogen manufacturing, storage, transportation, and sales. If you’re optimistic about the long-term development of this sector, using an ETF may be a more hassle-free option.