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Inside the Recent Rally in Hydrogen ETFs

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Global X Hydrogen ETF (HYDR - Free Report) has been hovering around a 52-week high lately. The ETF has gained 16.7% over the past week and has advanced 25.8% over the past month (as of Sept. 17, 2025).

The ETF’s second holding, Plug Power (PLUG - Free Report) stock — which takes about 18% of the fund’s weight — surged 19.1% on Sept. 17, 2025, and skyrocketed 40.6% over the past week (as of Sept. 17, 2025). The ETF’s top holding — Bloom Energy (BE - Free Report) stock — gained 8.7% on Sept. 17, 2025. The BE stock advanced 24.6% over the past week.

Note that in early July, Plug Power announced a new multi-year supply deal with a leading U.S.-based industrial gas partner, extending their alliance through 2030 to secure hydrogen supply, cut costs, and boost cash flow.

The Global Green Energy Revolution

The green energy revolution is gaining steam, and global investors are making the most of this emerging trend. Amid the demand for cleaner fuel sources, hydrogen has emerged as a key player.

Hydrogen, when used as a fuel source, only emits water and heat, making it a clean energy alternative. When combusted or used in fuel cells, it produces water as the only by-product.This is in stark contrast to fossil fuels, which emit harmful greenhouse gases.

The massive energy needs of data centers fueled by the ongoing AI boom are driving demand for clean power sources. Hydrogen power is a clear beneficiary of this trend. While cost is a hurdle, the technological advancements will help it come down over the years.

Supply Crunch Ahead?

The International Energy Agency (IEA) reported recently that cancellations, cost pressures and policy uncertainty have weakened the low-emissions hydrogen project pipeline.As a result, the 2030 projected hydrogen development has dropped nearly 25% (according to IEA), per a Reuters article, as quoted on Yahoo Finance.

The IEA’s Global Hydrogen Review shows that the expected production for 2030 now stands at 37 million metric tons per year, down from 49 million metric tons estimated just a year earlier. Many developers have postponed or abandoned their plans, the report noted.

Still, capacity that is already operational, under construction, or at final investment decision is projected to grow about fivefold from 2024, reaching above 4 million tons per year by 2030, per IEA, as quoted on the above-mentioned Reuters article, cited by Yahoo Finance.

Higher Cost Structure to Ease by 2030 (Per IEA)?

Recent declines in natural gas prices favored fossil-based hydrogen, while rising electrolyser prices have weighed on low-emissions projects. But the IEA expects the gap to narrow by 2030 as technology costs fall, renewable energy capacity expands, and regulatory frameworks improve, as quoted on the above-mentioned article.


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