Neil is building a new production line in Porsgrunn

Hydrogen company Nel will double capacity at its new plant in Porsgrunn, just four months after the plant officially opened. – When there is demand, we will expand capacity, says Nel President Håkon Volldal.

This photo was taken during the opening of Niels’ electrolyte production plant in Porsgrunn earlier this year. Now the company announces that it will build another production line at the new facility. Kjetil Malkenes Hovland, E24

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Neil announced that the company will build another production line at a fully automated facility at Herøya in Porsgrunn, increasing the production capacity of the alkaline electrolyzers to one gigawatt per year.

Production capacity is currently 500 megawatts, but there is room in the buildings to expand it to 2 gigawatts, Neil says in message. On Thursday, the company delivered a pre-tax second-quarter result minus NOK 277 million.

The new line will be operational by April 2024, and the company expects investment in new equipment to be around 35 million euros (343 million kroner). The electrolyzer separates hydrogen from water using electricity.

The expansion means Neil cements its position as a global leader in the development and manufacture of green hydrogen technology, says new company president Håkon Volldal, who took over from Jon André Løkke in July.

The investment decision comes after the company recently received its largest-ever order for electrolyzers with a total capacity of 200 megawatts. According to the company, the order came from an undisclosed US customer.

Herøya expansion supports what we mentioned earlier: when there is demand, we will expand capacity. The 200MW contract will not be a one-time event, and since we see the potential for more large orders in the near future, we have decided to expand production capacity, Fuldahl says.

This is how Nils’ new factory in Porsgrunn will be: – It will change the rules of the game

You must have five spells

According to the company, the new facility is setting production records per week, with three shifts in rotation. Neil expects to have five shifts in rotation by the end of the year.

E24 was around when the Herøya facility officially opened in April. There was also Oil and Energy Minister Terje Asland.

– There are important industrial jobs here. And here it shows with what it’s doing now that Norway is competitive as a production country, Aasland told E24 during the opening.

500 megawatts

The value of the new Nils factory in Heroya has been set at NOK 322 million in Nils Annual Report for the year 2021.

The facility in Porsgrunn will build electrolyzers with a total capacity of 500 megawatts each year, and will now be expanded to one gigawatt. The plant could be expanded to 2 gigawatts, a large proportion of Neil’s target of 10 gigawatts of total capacity by 2025.

Originally, Nel was planning to spend NOK 150 million at a plant in Notodden and expand the capacity to 360 MW, from the original 40 MW.

Neil has previously spoken about potential plant projects in the US and Asia, and the company said it is currently looking for land in the US.

The hydrogen company Nel in its time originated from Norsk Hydro, and in 2014 it became the first hydrogen company on the Oslo Stock Exchange.

Since then, there has been more. These include Hydrogenpro, which builds turnkey electrolysis plants, Everfuel, which supplies filling stations, and Hexagon Purus, which provides, among other things, storage systems.

Reducing the deficit: lost 277 million in the second quarter

Waiting for a better market in the US

In April, Jean-Andre Luc, CEO of Nel, called the new plant a “game changer” and believed Nel to be a production cost leader for electrolyzers. However, wishing for better public support schemes, he pointed to Germany, which provides significant support to the hydrogen industry.

We think it’s a bit unfair that our competitors have access to different framework conditions than ours. We have to be responsible for our investors, Løkke told E24 in April.

The United States has now announced policy measures through the Inflation Reduction Act, in order, among other things, to accelerate the production of green hydrogen, potentially making the country a more important market for Nile, the company says in its country. Quarterly offer for the second quarter.

With a three-dollar-a-kg tax deduction in the United States, Neil believes green hydrogen could become a more important competitor to hydrogen produced from gas, which produces significant emissions of carbon dioxide.