Energy industry veterans to launch hydrogen investment fund

Energy industry veterans to launch hydrogen investment fund

Reuters  | Jul 09, 2020 14:00

Energy industry veterans to launch hydrogen investment fund

By Ron Bousso

LONDON (Reuters) - Two energy industry veterans plan to launch an investment fund focused on hydrogen this year as more and more governments include the niche fuel in their global warming battle plans.

Hydrogen has long-been touted as a potential clean fuel as it only emits water vapour but it has failed to gain traction, mainly because of historically high production, transportation and storage costs.

But with the European Union for one now looking to promote so-called green hydrogen to help reach net zero emissions, the sector is expected to attract hundreds of billions of dollars in investment in the coming decades.

The new fund, HydrogenOne Capital, is being launched by JJ Traynor, a former Royal Dutch Shell (LON:RDSa) executive, and Richard Hulf, who has worked at Exxon Mobil (NYSE:XOM) and been an energy fund manager at Artemis.

"We've spoken to a lot of people in the market who are interested in the theme but find it very hard to get invested, so our idea is to get a very focused team to be dedicated to this," Traynor told Reuters.

The 250 million pound ($315 million) fund is due to be launched by the end of 2020, according to a presentation for investors seen by Reuters. The London-based fund would be the world's first hydrogen-dedicated investment fund, Traynor said.

Analysts at Barclays (LON:BARC) expect demand for hydrogen to grow eight-fold to 575 million tonnes per year by 2050 in a market worth more than $1 trillion.

Shares of hydrogen-focused companies such as Bloom Energy and Ceres Power have soared as interest in the sector grows and governments and large energy and industrial companies accelerate plans to invest in hydrogen.

Most of the hydrogen available today is dubbed "grey" as it is made from natural gas in a process that creates carbon emissions. It is also mainly used by polluting sectors such oil refining, steel and chemicals.

The new fund will prioritise investments in "green" hydrogen, which is produced by electrolysis using renewable energy sources such as wind, solar and hydro, according to the prospectus.

However, it will consider investments in grey and "blue" hydrogen - made using gas but capturing and storing carbon emissions - as economies make the transition to cleaner fuels.

While HydrogenOne Capital will buy shares in listed companies, Traynor said the best value would come from investing in specific projects and private assets.

"Clean hydrogen is gaining strong political and business momentum," Goldman Sachs (NYSE:GS) said in a report this month. "This is why we believe that the hydrogen value chain deserves serious focus after three false starts in the past 50 years."

($1 = 0.7947 pounds)

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (India) English (Canada) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
Saving Changes


Download the App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors. is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.