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About Nel ASA
Nel ASA (OSE: NEL) is a globally recognized hydrogen technology company specializing in the development and production of electrolyser systems and hydrogen fueling equipment. With a history dating back to 1927, Nel has established itself as a pioneer in the renewable hydrogen industry, providing critical solutions for decarbonizing a wide range of sectors, including transportation, steel production, refining, and ammonia synthesis.
Core Business Areas
Nel ASA operates primarily in two key business segments:
- Electrolyser Technology: Nel manufactures advanced alkaline and Proton Exchange Membrane (PEM) electrolysers, enabling the production of renewable hydrogen from water using electricity. These systems are integral to creating a green hydrogen economy, supporting industries in reducing their carbon footprint.
- Hydrogen Fueling Infrastructure: Nel designs and supplies hydrogen fueling stations for road-going vehicles, contributing to the adoption of hydrogen as a clean transportation fuel.
Market Position and Industry Significance
Nel ASA is a pure-play hydrogen technology company with a global footprint. Its products are key enablers of the energy transition, making it possible to decarbonize hard-to-abate industries. The company has forged strategic partnerships with major industrial players, such as General Motors, Reliance Industries, and Samsung C&T, to expand its market reach and enhance its technological offerings.
Nel’s electrolyser technologies are widely regarded for their robustness, durability, and energy efficiency. The company’s commitment to innovation is evident in its ongoing development of next-generation pressurized alkaline technology, supported by significant grants from entities like the EU Innovation Fund and the U.S. Department of Energy.
Revenue Streams and Business Model
Nel generates revenue through the sale of electrolyser systems, hydrogen fueling equipment, and technology licensing agreements. The company also benefits from government grants and tax credits, which support its R&D initiatives and manufacturing expansions. Its collaboration with industrial giants and academic institutions further strengthens its position in the hydrogen value chain.
Competitive Landscape
Operating in a competitive industry, Nel ASA differentiates itself through its nearly century-long history, proven technology platforms, and global presence. Competitors include other hydrogen-focused companies like Plug Power, ITM Power, and Ballard Power Systems. Nel’s ability to secure high-profile partnerships and funding underscores its authority and expertise in the sector.
Technological Expertise
Nel’s product portfolio includes both alkaline and PEM electrolysers, catering to diverse industrial needs. The company is actively involved in R&D to improve the cost-efficiency and performance of its technologies. Recent advancements include the development of scalable solutions like the IVHY™ 100, designed for large-scale renewable hydrogen production.
Global Impact
Nel’s technologies are instrumental in driving the global shift toward renewable energy. By enabling the production and distribution of green hydrogen, the company supports the decarbonization of industries and contributes to achieving global climate goals. Its projects span multiple continents, reflecting its commitment to building a sustainable energy future.
Nel Hydrogen US has entered a joint development agreement with General Motors (GM) to advance the industrialization of Nel's proton exchange membrane (PEM) electrolyzer technology. This collaboration aims to create more cost-competitive renewable hydrogen solutions by leveraging GM's expertise in fuel cells and Nel's electrolyzer knowledge. GM will receive compensation for the development work and will charge a licensing fee upon successful commercialization. Both companies see substantial synergies in their technologies, promoting clean hydrogen infrastructure and opening new revenue channels for GM.
Nel Hydrogen US, a subsidiary of Nel ASA, announced a joint development agreement with General Motors to advance the industrialization of its proton exchange membrane (PEM) electrolyser platform. This collaboration leverages GM's fuel cell expertise and Nel's electrolyser technology to create more cost-effective renewable hydrogen sources. CEO Håkon Volldal emphasized the competitive advantage gained through this partnership. Nel will compensate GM for development and pay licensing fees upon successful commercialization of products utilizing GM technology.
Nel Hydrogen Electrolyser AS has secured a contract valued at approximately NOK 600 million with Woodside Energy for alkaline electrolyser equipment to support the H2OK hydrogen project in Ardmore, Oklahoma. This marks Woodside's inaugural hydrogen initiative in the US, aiming for a production capacity of 60 tons per day. The electrolyser stacks will be produced at Nel's fully automated facility in Herøya. The contract is anticipated to yield substantial financial benefits for Nel and aligns with the growing demand for hydrogen technology in transportation and industry.
Nel Hydrogen Electrolyser AS, a subsidiary of Nel ASA, has secured a NOK 600 million contract with Woodside Energy for electrolyser equipment, supporting the H2OK hydrogen project in Oklahoma. This marks Woodside's first hydrogen venture in the US, aiming to produce liquid hydrogen for fuel cell vehicles. The contract follows Nel's record 200 MW order for a US project, highlighting the favorable growth in the electrolyser market. The equipment, manufactured in Nel's automated facility, is set for production throughout 2024.
The Inflation Reduction Act (IRA) introduces nearly $370 billion in climate funding for clean technology, positioning the USA as a leader in green hydrogen. Key provisions include a 10-year production tax credit of up to $3 per kg of green hydrogen and a 30% investment tax credit for energy-storage technology. The Act is expected to reduce CO2 emissions by 40% from 2005 levels, incentivizing investments in communities reliant on fossil fuels. Nel ASA's recent electrolyser order highlights the growing North American market, with a €45 million ($46 million) stack set to go live in 2024.
The Inflation Reduction Act will provide tax credits of up to $3 per kg of clean hydrogen, significantly impacting the green hydrogen market in the USA. CEO Håkon Volldal highlighted the bill's revival, affirming the USA's position as a leading location for clean hydrogen production. Nel recently secured its largest electrolyser order, valued at €45m ($46m), which is set to operate in 2024. This strategic move is supported by long-term power supply and demand agreements, enhancing investment prospects in green hydrogen.
Nel ASA is expanding its production capacity by building a new fully automated production line in Herøya, Norway, which will double its alkaline electrolyser stacks output to approximately 1 GW. This decision comes after a record order for 200 MW from a US customer, indicating strong demand for green hydrogen technology. The new facility aims to be operational by April 2024 with a capital expenditure of around EUR 35 million. The expansion positions Norway as a leading exporter of electrolyser equipment, supporting the growing hydrogen market.
Nel Hydrogen Electrolyser AS, a subsidiary of Nel ASA, has received a record purchase order for 200 MW of alkaline electrolyser equipment from an undisclosed US customer.
The contract, valued at over EUR 45 million, will be executed from February 2023 to mid-2024. This project received significant funding from private investors and local government incentives, demonstrating Nel's capabilities in large-scale hydrogen production. The completion of this project is expected to positively influence Nel's financials and establish a reference for future contracts.
Nel Hydrogen US, a subsidiary of Nel ASA, has secured a purchase order from Viva Energy Australia for a MC500 containerized PEM water electrolyser, slated to be the largest in Australia. This electrolyser will produce up to 1,063kg/day of green hydrogen for fuel cell vehicles at a new energy service station in Geelong. The project, valued at approximately EUR 4 million, received funding from the Australian Renewable Energy Agency and the Victorian Government. Delivery is expected in Q3 2023, marking an important step in Australia's efforts to decarbonize the mobility sector.
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