ETF Securities Releases First Ever Pure Play Hydrogen ETF in Australia

Achieving net-zero emission is among the most pressing matters for coming decades.  Hydrogen, the most plentiful element in the entire universe, plays a crucial role in these plans. The amount and scope of projects in this field are increasing, and companies, policymakers, as well as regulators, are raising their investments and attention. ETF Securities recognizes the need for action and released its ETFS Hydrogen ETF, tracking companies that have business operations in the field of hydrogen. The ETF tracks the Solactive Global Hydrogen ESG Index.  

The mission to curb the emission from vehicles and reduce air pollutions across countries by 2050 has heightened the demand for fuel cell electric vehicles. Hydrogen serves as one of the promising clean energy sources in the fight against climate change. Hydrogen is used to power these FCEV vehicles, making it an affordable, environmentally friendly, and safe transportation option. It will continuously play a critical role in meeting green production targets and transitioning to a sustainable energy future. Therefore, hydrogen is at the forefront of policymaking and currently has over 200 projects exceeding $300B USD planned in the private sector. The demand for green energy is only increasing as we approach the 2050 timeline, with many countries aiming for even earlier implementation.

Solactive Global Hydrogen ESG Index

The Solactive Global Hydrogen ESG Index serves as the underlying of the ETFS Hydrogen ETF. This index is composed of companies involved in the production of hydrogen components, manufacturing, and development of hydrogen-based infrastructures. Companies that are engaged in the storage, generation, and distribution of hydrogen are also eligible for inclusion.

ARTIS®

The selection of the Solactive Global Hydrogen ESG Index’s constituents is based on Solactive’s proprietary Natural Language Processing Engine ARTIS®ARTIS® utilizes advanced algorithms to parse high volumes of public documents evaluating companies’ exposure to various themes or topics. The sophisticated procedure not only detects potential index constituents considering a firm’s exposure to a theme but also ranks its importance to the very subject or industry.

ESG Screening

In addition to its inherent sustainability approach, companies that are non-compliant with the UNGC, with notable involvement in controversial weapons, small arms, gambling, recreational cannabis & tobacco, thermal coal, and oil & gas based on operation and revenue thresholds, are excluded from the index. As ESG provider serves Minerva Analytics Ltd.

“Our society’s concern over climate change continues to grow with more people across the world willing to make sacrifices to address it. With net-zero emission goals becoming more common among advanced economies, the desire for hydrogen-powered technologies has never been stronger. Together with our long-term partners at ETF Securities, we are excited to be able to provide investors with the opportunity to invest in strong growth as well as to indirectly combat climate change.”  comments Timo Pfeiffer, Chief Markets Officer at Solactive.

Evan Metcalf, Head of Product at ETF Securities, comments “Our investors are increasingly asking us for more options to invest in clean energy technologies. The hydrogen economy has vast potential to provide energy solutions across industries and address the challenges of transitioning to a future powered by clean energy. We appreciate the efforts of Solactive in bringing this product to market and are excited to be expanding our partnership into new areas.”

Published on October 7, 2021

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