The Norwegian OEM has taken a final investment decision (FID) to build 1GW of production capacity at its Herøya facility.

Representing an investment of NOK 300m ($29m), Nel will receive up to €135m ($158m) from the EU Innovation Fund, covering up to 60% of the industrialisation costs.

Nel says its pressurised alkaline system costs less to build, uses less electricity, and can therefore produce hydrogen for less.

The next-generation, pressurised technology also reduces downstream costs and is fully modular and skid-based.

Nel aims for a commercial launch in 2026, with deliveries starting in 2027.

“A significantly improved levelised cost of hydrogen is expected to unlock business cases that were previously not viable without significant subsidies,” claimed Håkon Volldal, President and CEO of Nel.

Nel’s FID marks a pivot away from its struggling legacy alkaline technology toward its new pressurised platform.

The move follows the temporary pause in alkaline production at its Norwegian factory in 2024 and is intended to restart demand by materially improving hydrogen project economics.

Nel halted production at Herøya in 2024 after orders collapsed, projects were delayed or cancelled, and a customer failed to pay for delivered equipment.