Like other industries, the energy sector has seen events being postponed or cancelled, making it difficult if not impossible to unveil new products, attend discussion panels and meet new people. But the partial lockdown has also opened up some new opportunities. Thanks to greater digitalization, online product presentations can still reach a global audience, face-to-face meetings are being replaced with webinars and video conferences, and phone calls have become an even more important means to stay in touch. Additionally, fewer commutes and business trips leave more time for other things and help reduce environmentally harmful emissions.
On March 19, German heating manufacturer Viessmann, based in Allendorf, announced it would shut down Hexis, its subsidiary in charge of developing SOFCs. The headline of the press release sounded rather innocuous: “Viessmann takes new path to implementing future-proof technology.“ However, in the third paragraph, the company then said it “will discontinue operations at Hexis.“
In 1883, the War of the Pacific, also known as the Saltpeter War, ended with the victory of Chile over Peru and Bolivia and Chile’s annexation of the Tarapacá and Antofagasta regions. But why go to war over the world’s driest desert? The area was rich in gold, albeit not the traditional kind.
Many events that were to be held this spring have been either cancelled or postponed because of public health concerns over Covid-19. Hannover Messe and Düsseldorf-based Energy Storage Europe will only return in 2021, the latter between March 16 and 18 next year. Essen-based SHK, the largest show for heating and sanitation in Germany, has been rescheduled to take place in late summer, from Sept. 1 through 4, 2020.
Since the beginning of the year, the fuel cell stocks covered in this issue had seen a fast uptrend, which ended with the spread of Covid-19 around the world. Fears over the impact of the disease on the global economy meant some gains were quickly lost. Still, in light of increased news coverage, multiple project announcements and the growing popularity of green hydrogen, it has become clear that hydrogen and fuel cells are entering the mainstream and their breakthrough into the market is approaching rapidly.
Cashing in around the USD 5 mark, as I recommended, may have been a bit premature, seeing that the price rose as high as USD 6, but was ultimately a prudent move. At present, Plug Power’s stock again trades around USD 3. You may wonder what happened in the meantime. Simply put, expectations were too high. The net loss per share amounted to USD 0.06 in the fourth quarter of 2019. Revenue rose to USD 91.7 million, compared to USD 59.8 million generated in the prior-year quarter, which means there is some good news.
The manufacture of the new powerful LCS stack, through a Weichai-Ballard joint venture in China, will start in the second half, or around the middle, of 2020. In my opinion, it will lay the foundation for high, long-term growth in revenue and profit. Considering what month it is, we will not have to wait long to find out. The positive news coming from this will form the basis for price trends throughout the year. I estimate a big jump, as Ballard Power is the global leader in manufacturing fuel cells.
Bloom Energy stock rose for a good while, to around USD 14, before falling dramatically. The plunge was a result of the company’s relatively weak performance in the fourth quarter of 2019 and the same-quarter restatement of managed service agreements entered into between 2016 and the end of last year. Instead of over the duration of the contract, the revenue for managed services transactions had been recognized upfront.
How quickly things can change. Just a few months ago, FuelCell Energy [Nasdaq: FCEL] risked bankruptcy due to questionable financial practices. With the help of a highly committed and successful consulting firm, the business then righted the ship. At one point, its price soared from around USD 0.13 to an intraday high of over USD 4.00 as it saw its market cap jump from USD 40 million to USD 500 million. The latest stock crash then put an end to it all and the stock took a nosedive, finishing below USD 1.00. It will certainly take some time before the price averages out to reflect business growth.
In the previous H2-international issue, I wrote that the price rally from USD 250 to more than USD 430 already represented a short squeeze. However, I was quickly disabused of that notion when I saw Tesla’s stock hitting an intraday high of USD 1,000 before pulling back in recent weeks.