Please ensure Javascript is enabled for purposes of website accessibility

Why Plug Power, Bloom Energy, and Nikola Stocks All Popped Today

By Rich Smith - May 18, 2021 at 4:42PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Nuclear power and fuel cells: a winning combination?

What happened

The market is dipping into the red again Tuesday, but one specific part of the market, fuel cell stocks, is bucking the trend and going higher.

As of 2:55 p.m. EDT, shares of industry bellwether Plug Power (PLUG 1.71%) are leading the pack higher with an 8.8% gain. Nikola Corporation (NKLA -3.23%) is up 5.6%, and fuel cell manufacturer Bloom Energy (BE 4.36%) is up 3.8%.

Windmill and solar panels and a nuclear power plant set against a blue sky

Image source: Getty Images.

So what

Curiously, it is Bloom -- the company with the most modest gains today -- that's got the most substantive news to report. In a press release this morning, Bloom announced that it's partnering with the U.S. Department of Energy's Idaho National Laboratory (INL) "to independently test the use of nuclear energy to create clean hydrogen through Bloom Energy's solid oxide, high-temperature electrolyzer."

Nuclear plants, you see, can run all day -- even when the electricity grid is amply supplied from other sources and may not necessarily need all the electricity a nuclear plant can produce. To see of it's possible to prevent that excess electricity from going to waste, therefore, INL will work with Bloom to use the excess power for electrolysis, splitting off hydrogen atoms from water to form hydrogen gas that can be stored for later use, then passed through Bloom's fuel cells to generate electricity at a later date.

Now what

INL Hydrogen and Thermal Systems Group lead Tyler Westover mentioned in the company's press release that a successful experiment has the potential to expand "markets for nuclear power plants by allowing them to switch between sending power to the electrical grid and producing clean hydrogen for transportation and industry energy sectors."

Energy investors are already aware of the arguments in favor of nuclear power: It's cleaner than fossil fuels, and often cheaper. Like renewable energy from wind and solar, it doesn't produce greenhouse gases -- and nuclear reactors are more compact, taking up less space than a wind or solar farm. Your average nuclear power plant can't be fit in the trunk of a family sedan, of course, but if it becomes possible to harness the electricity from a nuclear plant, "convert" it to hydrogen, and then use that hydrogen to power a fuel cell vehicle, well, that just might make nuclear power an even more attractive proposition than it already is.

In this way, good news from Bloom could actually be the reason why the stocks of companies that make fuel cells for vehicles, like Plug and Nikola, are going up today.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Bloom Energy Corporation Stock Quote
Bloom Energy Corporation
BE
$25.15 (4.36%) $1.05
Plug Power Inc. Stock Quote
Plug Power Inc.
PLUG
$25.62 (1.71%) $0.43
Nikola Corporation Stock Quote
Nikola Corporation
NKLA
$7.79 (-3.23%) $0.26

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
377%
 
S&P 500 Returns
123%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/09/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.