Nel ASA’s Fresh Electrolyser Platform Gets EU Backing but Faces an Immediate Price War

Nel ASA's new alkaline platform faces fierce price competition from Stiesdal. Order intake collapsed 73% YoY, raising doubts about 2027 factory utilization despite €135M EU grant.

Nel ASA launched its long-awaited pressure-based alkaline electrolyser platform in early May, yet within two weeks a Danish competitor had already pegged a lower price target. Stiesdal Hydrogen unveiled a 6.5-megawatt system on May 20 designed to push system costs below €500 per kilowatt — well under the European market average. For Nel, the message was stark: the new platform, eight years in development, must be price-competitive from day one.

The company’s stock has rallied roughly 50% since the start of the year, touching €0.29 in recent trading. But that run masks a fragile foundation. Nel’s first-quarter numbers released earlier this spring showed revenue of 148 million Norwegian kroner, down 5% from a year earlier. The EBITDA loss narrowed to 100 million kroner from 115 million kroner — progress, but not the kind that alone justifies the share price move.

Far more troubling was the order intake. It collapsed 73% year-on-year to just 85 million kroner, dragging the order backlog down 24% to 1.11 billion kroner. Management has acknowledged candidly that the current pipeline is insufficient to secure meaningful factory utilisation in 2027. Additional orders booked during the remainder of 2026 are therefore critical to the operational plan.

EU funding shores up Herøya, but can’t fill the order book

The new alkaline platform is being industrialised at Nel’s facility in Herøya, Norway, following a final investment decision taken in December 2025. The initial production line will have a capacity of up to 1 gigawatt per year, with a long-term plan to expand to 4 GW. The European Union’s Innovation Fund is backing the project with up to €135 million, covering as much as 60% of eligible costs. A further €11 million payment is expected in the second quarter of 2026.

That financial cushion buys time, but it does not replace commercial traction. Nel can rely on its balance sheet — liquid assets stood at 1.4 billion kroner at quarter-end — but the order drought remains the central question for investors.

Cost cuts come with a capacity warning

Nel has been aggressively reducing its cost base. Headcount has fallen to roughly 300, a 26% decline from its peak and down 19% since the first quarter of 2025. Personnel costs dropped 21% over the same period. The belt-tightening has improved the short-term cost structure, but management has warned that production and project execution capacity have deteriorated. If demand picks up suddenly, Nel may struggle to ramp up as quickly as needed.

Meanwhile, the alkaline division delivered a 6% revenue improvement and an EBITDA gain of 35 million kroner, offering a sliver of operational light. But the PEM segment remains a drag: parts of expected research grants have been under review since late last year and their disbursement timeline is uncertain.

Containerised PEM systems as a stopgap

Nel is leaning on standardised, containerised PEM systems to generate near-term revenue. These units, suitable for projects between 2.5 and 50 MW, can typically be delivered in under 12 months, making them attractive to customers unwilling to wait for bespoke large-scale plants. In April, Nel secured a follow-on order worth $7 million for such equipment in the United States, and the first order of the current quarter came in at roughly 70 million kroner. These deals help bridge gaps in the order pipeline but are not yet of a size that would transform the outlook.

Stock momentum hinges on orders, not technology

The share price currently trades at around €0.28, roughly 11% below its 52-week high struck on May 5 but well above the March low of €0.18. The RSI of 15.6 signals a deeply oversold condition, suggesting the recent pullback may be overdone. Yet the rally since January has been driven largely by technology optimism and sector tailwinds — not by concrete commercial wins.

Nel will report its half-year and second-quarter results on July 15. At that point, the spotlight will fall squarely on new orders, especially any initial traction for the alkaline platform and possible contributions from a previously announced US utility contract. Until those numbers arrive, the stock is running on hope, backed by a thin order book and an EU cheque that keeps the factory lights on but does not fill the production schedule.