ITM Power: State Backing and a Scottish Hydrogen Bet Converge Ahead of a Pivotal Year-End Decision

State-backed £40M investment and Protium partnership boost ITM Power's project pipeline, driving revenue growth and index inclusion.

A pair of developments in recent weeks has reshaped the narrative around ITM Power. The electrolyser manufacturer has secured a £40 million investment from Great British Energy, giving the state energy agency a 10.8% stake and making it the company's second-largest shareholder. At the same time, a strategic partnership with Protium Green Solutions has opened a new route to project ownership that goes beyond the traditional equipment sale model.

The two events, coming within days of each other, have drawn a new class of institutional investors into the stock. Index trackers were the first forced buyers: ITM Power's inclusion in the MSCI United Kingdom Small Cap Index at the end of May triggered a surge in trading volume to 27.6 million shares on the last day of the month — well above the daily average. The passive rebalancing created a mechanical wave of demand, but the real catalyst for longer-term money is the combination of government endorsement and a visible project pipeline.

That pipeline is anchored by the Cromarty Hydrogen Project in the Scottish Highlands. The project, which Protium recently took over, received backing from the first hydrogen allocation round and is slated for a 15-megawatt electrolysis unit that can produce up to 7 tonnes of green hydrogen per day — roughly 2,000 tonnes annually. The output is earmarked for industrial heat and power customers in the region that currently lack access to the national gas grid.

The partnership with Protium, formalised on 3 June 2026, provides a flexible framework. ITM can deploy its Hydropulse build-own-operate subsidiary, or sell electrolyser assets directly to Protium, depending on project economics. The first test of this model will come in December 2026, when Cromarty targets its final investment decision. That deadline is the most consequential near-term milestone for the stock.

ITM Power's financial position has steadily improved. In the first half of its financial year, revenue rose to £18.0 million from £15.5 million a year earlier. The adjusted EBITDA loss narrowed from £16.8 million to £11.9 million, while cash remained comfortable at £197.8 million. The order backlog has ballooned to £152 million from £43.7 million two years ago, with 71% of the pipeline considered profitable. In February, management raised its full-year revenue guidance to £40-43 million from an earlier range of £35-40 million, citing stronger project progression and milestone-based revenue recognition.

The £40 million injection from Great British Energy is earmarked in part for the "Chronos" project, a next-generation electrolyser stack technology that aims to double power density to 2.5 MW per square metre, with each unit delivering 2 MW of output. Beyond that, a planned government grant of £46.5 million would fund a fully automated production line targeting 1 GW of annual capacity, expected to go online by 2028.

The market has already priced in much of the optimism. ITM Power shares closed at €2.04 on Wednesday, representing a 181% year-to-date gain and more than triple the 52-week low of €0.65. The stock did slip 8% over the past week, and the Cromarty announcement itself triggered only a 1.36% rise to 187 pence — a muted reaction that reflects the gap between strategic potential and operational proof.

Protium has flagged a broader pipeline that includes the South Tees Net Zero project, future hydrogen allocation round bids, and unsubsidised developments across the UK. But for now, the focus is on Cromarty. The December 2026 final investment decision will either validate the partnership model or leave ITM Power still waiting for its first concrete project. State money and index inclusion have changed the shareholder base; execution on the ground will determine whether the rally has a foundation.