Bloom Energy's (NYSE:BE) business has changed a lot in the last 10 months, so it's going to change a lot in the next 10 years. And in an innovative and fast-moving energy environment, it's not easy to say exactly where a business is going to be a decade from now. But we have some good ideas based on the company's road map. 

Recently released products and a hydrogen road map indicate that Bloom Energy is either going to create a new hydrogen infrastructure or die trying. And that's why this is both a risky and a high-upside renewable energy stock

Wind, solar, and hydrogen assets in a forest.

Image source: Getty Images.

The hydrogen economy

For more than a decade, energy observers have been dreaming about a hydrogen economy. The idea of the hydrogen economy is that instead of using fossil fuels for transportation and other energy needs not tethered to an electric line, we can use hydrogen instead.

The supply side is relatively simple. Wind and solar power plants could be used to supply electricity to electrolyzers, which will turn renewable electricity and water into hydrogen gas. That hydrogen can then be stored or moved all over the country and world through pipelines or even on ships. 

At the point of use, fuel cells will convert hydrogen back into electricity and water. Fuel cells can power everything from the power grid to an automobile. It's a clean energy cycle and if it's cost-effective versus fossil fuels, it could replace a multitrillion-dollar fossil fuel industry. But until recently, renewable energy, electrolysis, and fuel cells were all too expensive to make financial sense. 

The game changer for the hydrogen economy

The first domino to fall in the cost structure of the hydrogen economy was renewable energy. Wind and solar electricity now costs less than fossil fuels in most of the U.S. and in some cases can be less than $0.02 per kW-hour. That's cheap enough to consider it as an input source for electrolyzers

Next, fuel cells are getting to be efficient enough and cheap enough to be considered by utilities and businesses. Today, that's Bloom Energy's core business, and the company has shown value as a source of cost-effective backup power. As costs continue to come down, it'll become a cost-effective source of core power. 

The missing piece here is the electrolyzer. And that's where Bloom Energy's future could ultimately be defined a decade from now. 

Why solid oxide is the key to Bloom Energy's future

Where I think Bloom Energy becomes a truly innovative and disruptive company in the hydrogen space is with what's called a solid oxide fuel cell. According to management, the company's solid oxide fuel cells can use hydrogen as a fuel to generate electricity or run in reverse and be an electrolyzer. So, it can produce hydrogen running in one direction and turn hydrogen into electricity in the other. 

We've never had the ability to produce fuel from renewable energy and consume it days, weeks, or even months later. So, this is an entirely new concept in energy. 

The opportunities this solid oxide fuel cell opens up aren't limited to utilities or commercial buildings, either. Bloom Energy is already working with Samsung Heavy Industries to produce a renewable hydrogen-powered ship. This is technology that could actually make shipping clean. And if it's economical, it could change nearly every aspect of the energy industry. When we look out a decade from now, building the hydrogen economy is the future for Bloom Energy. 

Bloom Energy could change energy forever

There's no guarantee hydrogen will be a big source of fuel a decade from now, but with wind and solar prices coming down and clean hydrogen now within sight, I think it's a possibility for utility-scale energy storage or shipping. And if it is, Bloom Energy is well-positioned to capitalize in some of the energy industry's largest markets. That makes this a very high-potential stock, and it could be the kind of company that changes how we view energy forever.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.