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Although I'm not a fan of the idea I think this increases the probability for a full buyout by Linde. I just hope we get a significant SP increase well before that happens, and a further boost if/when that decision is made.

Thanks Tennents.

I was a little surprised. It seemed one of Michael's more positive analysis on the scope of hydrogen.

I still think he's probably wrong on the trucking analysis though. It's hard to imagine truckers being content with the position of having to find an empty charge point that coincides with their regulation break. What about all those roadside lay-bys with burger shacks they use. Either someone's going to have to put a couple of superchargers in each of those or those lay-bys become a thing of the past.

Tennents, been searching all day, where did you manage to find that info?

He could direct his tweeting towards Octopus Hydrogen and get them on board.

I hope ITM get it and a share boost. That would at least offset my poor timing of investing in CPH2 yesterday...doh.

Well that's annoying. I put my investment in the shares yesterday on an expectation that the company would resolve the issue over the next few months and that the relationship with Octopus would get stronger. Shows what I know...doh.

True SatP, that vulnerability is my biggest worry (next to going bust). Such a bargain. I think it's only the current share ownership structure that's stopping such opportunism...unless (as per current discussion) Linde wanted it all. I just hope I'm right with my expectation of where Linde's business mindset is at right now, that there isn't significant enough upside to outright ownership. We'll see. I won't cry for long if it happens because I'm still up, and I'd probably just reposition more strongly behind Plug Power.

I see where you're coming from, but just as I'm being over-optimistic about ITM's own abilities, I think you're over-optimistic on the needs of Linde. I can see them buying out ITM Power to put it out of its misery, and because it's a bargain. There's very little extra that they would get out of ownership that they don't already have - 20% stake, 50% partnership, and the lion's share of the engineering works. The electrolyser becomes quite a small part of the opportunity if you hold all the other cards.

I'm also not convinced ITM would 'explode' on the news either. Even if it doubled in price many investors would still be under water, and the price would still be undervaluing the company's potential. I have a similar situation going on right now with Siemens Gamesa. The buyout by Siemens Energy is going through at €18 which is 44% up from its low. It still leaves me 33% down on my holding and forced to sell at that price, so not happy.

While I'm at it, I guess I should clarify that I think Jean coming to ITM Motive will have negligible bearing on ITM Power, far from being crucial. That being said, my views are not gospel.

Here's a counter argument to your points Preparetofail.

Linde already have a joint partnership with ITM in ILE. If Linde wanted to push the technology they are already well placed to do so without needing to be majority shareholder.

The new CEO is for ITM Motive, not ITM Power so will have little bearing on the way ITM do business. Maybe we will have a new CEO in January but nothing has been announced yet.

I agree that ITM Power is undervalued (as long as they survive) and Australia is a great opportunity if they can achieve more than just a government grant in the region.

If Linde do buy out ITM Power in full then that will not be good for many current shareholders who would be unlikely to recover their high priced share purchases and at best they would end up owning Linde shares instead. Although probably a more stable stockholding it's not likely to return the same growth that ITM has the potential for. Even though I am still in a positive position with my ITM holding I would rather not be forced to swap them for Linde shares.

Feels like ITM are about the only one without a shiny GW order to wave about.

I've been looking but I just can't see the correlation between short positions and the 'shock' event price moves. Granted, those that have been short ITM for the better part of 6-12 months have made a decent killing. But there was 1.5% of short positions actually closed just before the poor trading update so they could be kicking themselves for having missed that extra 20% drop. Since the trading update the stock is now up, thanks to the US CPI influence, whilst the shorters have been increasing their positions again so currently not a winning trade.

I accept I missed your point about the "tooling equipment...next month". So perhaps I'm just missing the shorting correlation. To be honest, I'm just not really bothered what the shorters do. We're all part of the same market. They've done well to predict that ITM and its market position will be super-slow to develop. I've been too optimistically up-beat.

That seems a bit harsh. It's almost exactly the news that ITM put out in its trading update RNS nearly 3 weeks ago. That's the whole reason we're down at this price.

https://www.lse.co.uk/rns/ITM/trading-update-wq0ofbnr3rub9s8.html

Specifically...

"Due to manufacturing issues including delays in finalising the tooling and testing of these stacks, the Company now expects that full year output and revenue is likely to be towards the bottom of the current guidance range. The timing of this revenue will be weighted towards the final quarter of the current financial year, and will be dependent on success of the current work to resolve these issues. The previously announced range is 48MW-65MW of delivered product and revenue of £23m-£28m.

These production issues have resulted in limited deliveries of new, first of kind product which in turn has meant only limited field data for performance to assess the level of warranty provisions. As a consequence of the limited field data, the warranty provision for these next generation contracted products will need to materially increase from the current level of £3m at FY22 year end and may result in a revision to EBITDA loss guidance. The accuracy of the product warranty provision will improve as more field data is acquired. This is evolving technology and by its nature that creates inherent uncertainty applicable to any company introducing new technology into a rapidly developing industry.

The Board is aware of the potential risk associated with the growing and uncertain levels of warranty provisions and is seeking to mitigate this portfolio risk. As a result, the Company expects there may be delays in finalising contracts in the final stages of negotiation which could place large scale projects at risk of deferred financial close."

It looks like ITM are still ahead with their technology, but let's hope they can iron out the difficulties they owned up to recently. I think Plug Power are still only offering and building around their 1MW stack whilst ITM are moving to 2MW and 5MW. For scaleability that could really matter (although it's not altogether clear why customers can't just construct everything out of enough 1MW stacks if you've got the space).

But ITM seem to have dropped the ball by showing too much loyalty to their initial customers with what feel like exclusive partnerships. We have seen that Shell are in other partnerships with multiple projects all over the world. Likewise Linde don't seem to care what colour their hydrogen is. And we've heard nothing from Snam in over two years.

Plug also recognise the advantage in vertical integration. They have a head start in this as they began in fuel cells and end-user forklift product. They're going full vertical integration with manufacturing their own electrolyser systems, using those electrolysers in their own green hydrogen production factories, building their own delivery trucks, delivering hydrogen to their forklift truck customers, and selling more hydrogen forklift trucks. So no matter what their future customers ask them to supply, their answer will be "Yes we can". On the other hand ITM had one bad experience trying to supply and construct all the balance of plant to Shell that they immediately threw in the towel and signed that part of the business over to Linde.

It's still early days for this industry (assuming hydrogen actually is the future) and ITM can still do well. But I think they need to take back control and get back to doing their own marketing and selling. After all it was their own marketing and selling that got Shell, Linde and Snam in the first place.

It's the CPI data released in US. It's come in under all forecasts so a huge stockmarket move was expected as a result. You never know though, they could give it all back by the end of the day. All tech is up massively so far.

I'm not a fan of nuclear, but I found this interesting...

https://www.youtube.com/watch?v=_uTZWaJU6ho

...but just don't expect the UK to lead the way on it.

It's nearly 6 years since ITM and Shell opened the Cobham Services hyrdrogen refueling pump. Had we built only 10 each year since then we'd be able to describe it now as a national network. And it would have probably only cost about £25m each year. But instead we seem to be closing them down faster than we're putting them up. And we're probably spending more than that amount on running 'competitions' and studies instead. It's all daft.

Looking at the numbers it feels like the energy storage opportunity for hydrogen is a long way off being useful, if you're considering excess wind as a driving factor. I accept that we're early days for wind generation (heading for about 60TWh this year out of approx 270TWh electricity demand), but curtailed excess generation is going to be about 4TWh. If you want to capture that through electrolysis you'd be able to supply about 0.5% of our annual electricity demand or 0.33% of our annual gas usage.

I would concentrate instead on using the green hydrogen from excess wind to directly replace existing grey hydrogen demand. UK grey hydrogen demand is approx 700 ktonne (2020) and the numbers presented above represent approx 70 ktonne of green hydrogen generation. So already if we had 1GW of electrolysis equipment, appropriately spread across the network to capture the excess generation, we'd be satisfying about 10% of the UK hydrogen commodity demand.

Furthermore, we'll be spending around £200m on curtailment this year to generate absolutely nothing, whereas the hydrogen we could have generated instead could have been sold for circa £200m-£350m. The economic case already looks sound but for some reason the inability of our masters to connect the dots is letting us down.

Perhaps I've got it wrong. Maybe someone could double-check my numbers.

I don't quite see why the new CEO of ITM-Motive should be such a negative influence for ITM Power. I rate the chances of success for ITM-Motive to be <25% irrespective of who runs it. So I don't see that as being a huge driver of electrolyser sales to ITM Power either. I'll be more intersted to see who they choose to be the new CEO of ITM Power. Might be more enlightening or concerning if it's a Linde man.

Pretty much as we've been experiencing over recent months.

https://www.ft.com/content/7d7420bc-079e-4730-b849-5a18ccd7258f

Anyone behind a paywall can read an alternative summary at either of these...
https://hydrogen-central.com/johnson-matthey-chief-says-uk-fallen-behind-hydrogen-energy-race/
https://www.newsncr.com/business/johnson-matthey-chief-says-uk-has-fallen-behind-in-hydrogen-power-race/