Nel ASA’s New Electrolyser Aims to Halve Green Hydrogen Costs as Orders Dwindle

Nel ASA launches pressurized alkaline electrolyser targeting 40-60% cost cuts, betting on affordability to revive stalled hydrogen projects despite a 73% drop in Q1 orders.

After eight years in development, Nel ASA has unveiled a pressurized alkaline electrolyser platform that promises to slash system costs by 40 to 60 percent — just as the Norwegian company faces a brutal downturn in new orders. The timing is deliberate: management is betting that a step-change in affordability will unlock projects that have stalled under today’s prohibitive pricing.

The headline figure is compelling. Nel is targeting turnkey costs of under $1,450 per kilowatt for a 25-megawatt installation, compared with the $3,000-plus that many industrial projects now face. The platform operates at 30 bar and delivers hydrogen with 99.99 percent purity, leveraging proprietary manufacturing techniques and patent-pending modular designs. Chief Technology Officer Marius Løken said the system was engineered for “standardization and industrial scale,” with factory-built modules that reduce on-site complexity and improve efficiency.

From steel mills to defense applications

While traditional buyers in steel and chemicals remain core customers, Nel is eyeing entirely new demand drivers. Chief Commercial Officer Todd Cartwright noted growing interest in robust systems for energy security and decentralized grid stabilization, including defense-related applications. The logic is straightforward: on-site production cuts reliance on centralized infrastructure, making hydrogen a tool for resilience as much as decarbonization.

The production ramp-up at Herøya is being underwritten by the EU Innovation Fund, which has pledged up to €135 million — covering as much as 60 percent of eligible costs. Nel expects an initial tranche of €11 million in the second quarter of 2026. The final investment decision for the facility was taken in December 2025, with capacity initially set at one gigawatt per year and a roadmap to expand to four gigawatts.

A stark contrast in the order book

The technological milestone lands against a difficult financial backdrop. First-quarter order intake collapsed 73 percent to just 85 million Norwegian kroner, while the order backlog shrank to 1.1 billion kroner. Nel ended the period with liquidity of 1.4 billion kroner, which management says is sufficient to fund operations through the end of 2026.

The market reaction has been mixed. The stock has rallied roughly 35 percent since the start of the year, but it gave back nearly eight percent on Thursday to trade at €0.26 — well below the year-high hit just before the platform launch. The volatility reflects investor anxiety about whether the technology can translate into binding contracts before cash runs low.

The July deadline

CEO Håkon Volldal is already in active negotiations for projects in the 50- to 150-megawatt range across Europe and North America. Whether those discussions turn into firm orders will become clear on July 15, when Nel reports its half-year results. “Our technology is meant to enable business models that weren’t feasible before,” Volldal said. For investors, the proof will be in the pipeline — and the clock is ticking.