The trouble with fuel cells

Kelly Evans's afternoon commentary & top market stories

VIEW IN BROWSER | SUBSCRIBE THU, SEP 23, 2021 YOUR AFTERNOON NEWS UPDATE AND MARKET ACTION FROM CNBC AS OF THU, SEP 23, 2021 • 11:08 ET DJIA 34749.57 +1.43% +491.25 S&P 500 4451.27 +1.27% +55.63 NASDAQ 15038.29 +0.95% +141.44   EDITOR'S NOTE So far, the Elon Musk version of the world is winning. Even as sales of EVs are starting to take off, fuel cell-powered vehicles remain a tiny market niche. Hydrogen-powered fuel cells may have advantages to battery-powered EVs, but they're expensive, lack charging infrastructure, and have never had a Tesla-esque breakthrough with the public. Musk famously called them "fool cells" several years back.    Where have fuel cells made more inroads? In the "material handling business," led by Plug Power's success with forklifts, for instance; in specific, on-site locations where commercial and industrial customers need backup, reliable energy (think research facilities); and occasionally, with buses, led by Ballard Power, and long-range trucks, despite Nikola's high-profile stumbles.    But for all the promise of "hydrogen" power, fuel cell plays have largely disappointed investors. Even this year, with D.C. working on tons of new clean energy fiscal support, Plug Power is down 21%, Bloom Energy is down 32%, Ballard is down 34%, and Fuelcell--a company which went public almost thirty years ago!--is down 40%. Meanwhile, Nikola went public at around $37 last June, and is trading under $11 today.    Plug Power did get an upgrade to overweight at Piper Sandler today, although that's in part because the stock performance has been so disappointing that the shares now "offer an attractive entry point." To its credit, Plug Power is pressing ahead with new "green" hydrogen plants powered by renewables; ironically, one of the flaws with hydrogen power has been the natural gas typically required to produce it. (For more, check out Forbes' deep dive on Bloom's struggles last year.)    But the other obvious trend working against the growth of more fuel cell power is the plunge in the cost of solar and wind, as we've been discussing. Even those renewable providers struggle to provide strong financial returns to investors, let alone fuel cell technology which is a relatively mature industry still trying to grow its top-line.    The early excitement around Nikola suggests that there is still an opportunity to reengage the public with fuel cell technology--and it may yet be a dazzling, if niche, success. But the burden of proof is now squarely on these providers to pull it off. And investors are right to wait on the sidelines in the meantime.    See you at 1 p.m!   Kelly Kelly Evans Twitter: @KellyCNBC Instagram: @realkellyevans       Watch our live stream for all you need to know to invest smarter. KEY STORIES  China asks local officials to prepare for 'possible storm' if Evergrande fails, WSJ says Chinese authorities are preparing for the potential downfall of Evergrande, The Wall Street Journal reported Thursday. Weekly jobless claims total 351,000, worse than expected First-time jobless claims totaled 351,000 last week, an increase from 16,000 a week before and well ahead of the 320,000 Dow Jones estimate. Biden's EPA orders a slash in climate-warming chemicals used in air-conditioning and refrigeration The Biden administration is slashing the use of hydrofluorocarbons, or HFCs, potent climate-warming chemicals used in air-conditioning and refrigeration. It's not your imagination: Restaurant drive-thrus are slower and less accurate Drive-thrus became slower and less accurate in 2021, according to SeeLevel HX's annual report. Investors brace for SEC Chair Gensler's report on GameStop and how brokerages get paid CNBC's Bob Pisani speaks with Larry Tabb of Bloomberg Intelligence on payment for order flow, a controversial practice SEC Chair Gensler may soon address. Bank of England downgrades growth projections, warns inflation will climb above 4% by year-end It comes after the U.K.'s economic growth slowed in July and consumer price inflation saw its largest month-on-month increase since records began in Jan. 1997. EU plans to make common charger mandatory for Apple iPhones and other devices The EU has put forward a new law that would force smartphone manufacturers and other electronics makers to equip their devices with a USB-C charging port. Norway hikes rates, becoming the first central bank in the developed world to do so After cutting rates three times in 2020, Norway's central bank unanimously decided to raise rates to 0.25% from zero. Volvo says it wants all its cars to be leather-free by 2030  A number of companies have announced plans to kit their vehicles out with materials other than leather. More hours, pay and flexibility: What Target's holiday hiring plans say about the labor market for retailers The big-box retailer plans to hire 100,000 seasonal employees, a lower number than in previous holiday seasons.     IN CASE YOU MISSED IT Here's the best way to solve the chip shortage crisis Citi strategist: China will likely change course on macro strategy Citi chief investment strategist on China and Evergrande's effect on global economy   Unsubscribe Manage Newsletters Terms of Service Join the CNBC Panel Digital Products Feedback Privacy Policy   © 2021 CNBC LLC. All rights reserved. A property of NBCUniversal. 900 Sylvan Avenue, Englewood Cliffs, NJ 07632 Data is a real-time snapshot *Data is delayed at least 15 minutes. Global Business and Financial News, Stock Quotes and Market Data and Analysis. Data also provided by THOMSON REUTERS