Nel to double electrolyser manufacturing capacity to 1GW on green hydrogen tailwinds in US and Europe
Recent 200MW order is ‘not a one off’ says Norwegian company as it eyes expansion into North America
Electrolyser manufacturer Nel is to spend €35m ($36.2m) to double the capacity of its alkaline electrolyser factory in Herøya, Norway, to 1GW, on the back of rising demand for green hydrogen production equipment and favourable political winds that extend beyond Europe to the US, Nel’s CEO Håkon Volldal told investors this morning.
In fact, the North American market will be increasingly important to Nel in the wake of the US Inflation Reduction Act and its hydrogen tax credits, and the company is now looking to expand its operations there, Volldal said.
But the €35m decision to expand is based on the calculated assumption that demand will continue to grow, Nel said, noting that the Herøya factory is designed for further scale up to up to 2GW.
“The Herøya expansion supports what we have previously communicated: when demand is present, we will add capacity,” said Volldal. “The recent 200 MW contract will not be a one-off, and as we see a potential for additional large orders in the foreseeable future, we have decided to expand our production capacity.”
Nel’s order book is bulging, according to the company’s quarterly results. Second-quarter orders — which do not include the 200MW order announced in July — were up by 61% year-on-year, and the company’s order backlog is currently sitting at $151m, up 12% on the previous quarter and 33% year-on-year.
Nel is now looking to expand its operations in the US, Volldal told investors, and is currently in the process of site selection for a facility there.
“The US will be increasingly important for hydrogen production and also for Nel,” he said. “We see a lot of accelerated plans for hydrogen production in America and that is nice to see.”
He added: “Europe and America are leading the way now on hydrogen and we will capitalise on that development.”
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