Member Info for toneman

Great. Thanks RH. Looks massive. Can't wait to see it up and running in a few months time. Excellent links, cheers.

But what do they count as an electrolyser per day? What rating? I can only find the 500MW, 1GW, 2GW total factory capacity quoted.

Certainly feels like a lot of people protecting their positions today.

RH I'm trying to verify 166 electrolysers per day projected for Heroya, but I can't find it. Where are you getting that number from please?

Are you sure RH? I'm reading Nel down today. Confusing.

Interesting journey Siddo. Sorry to hear you were taken in by the 'loveable rogue' Smithy, easily done though. I share your thoughts regarding "too good to be true". It's possible I've been top-slicing too much recently and will perhaps have a modest regret in 10 years time. Having said that, against my 'optimistic' forecast for hydrogen stocks when I first bought them I've already reached my 2030 targets. That means I either completely under estimated their potential or we've grown too big too fast, and I honestly don't know which it is.

What I've been doing recently is top-slicing some profit and often choosing 5% yielding ETF and Investment Trusts in both solar and wind as an attempt to diversify whilst maintaining the green portfolio agenda. I hope those will be less affected if hydrogen takes a near-term wobble, who knows. If my long term growth forecast for hydrogen still plays out then the remaining hydrogen assets will still do well enough that I should not cry over reduced returns. Otherwise, if we witness a significant pullback from recent over-exuberance then I will consider topping back up out of those 5% yielding funds.

Siddo, we all know something about the results due later this month. They're not going to show some sort of magical transformation. The accounts will only take us up to end Oct 2020. That was before the factory completion; certain Covid restrictions likely still in place on installation sites and travel; vaccines hadn't been announced so contracts on new projects probably still delayed; Biden hadn't been elected yet. All the latest and current positivity has come after the ITM accounts were closed.

But, the current positivity is important. The trading statement on current projects, anticipated factory production levels and forward-looking opportunities is vital. That had better explain to people why October's accounts don't matter otherwise some investors will question their position. We knew nothing of the Snam deal before it was announced in October, so ITM could still have a card or two up their sleeve. If they don't, then even that could be enough to hurt the share price as I expect some people are buying companies like ITM on the basis of that sort of deal announcement speculation rather than on their 10+ year growth potential.

Either way it could be an exciting day. Siddo, let us know, what are you expecting?

Any thoughts about Anne-Marie Trevelyan becoming the new Minister of State for Business, Energy and Clean Growth replacing Kwasi Kwarteng?

Kwasi was not really a champion of green hydrogen as he thought it was an expensive solution. Maybe Anne-Marie will be more favourable in line with the recent 10-point plan.

I checked through Hansard and it doesn't look like Anne-Marie has made any statements in the house toward new energy aside from a bit on tree planting. Her constituency is in the north east of England which should be key to offshore wind and green hydrogen, so fingers crossed she understands the importance of combining the two.

BusyBuilder, that's what happens to me. I've only ever managed to buy back in twice on previous occasions. Fortunately I only top-slice so I never leave myself empty-handed.

Brave call Seaangler. What if it just goes sideways, you're going to look like a prize plum :-)

Hard to say. It's already above what I thought was an optimistic 2022 price target.

1LEO, I don't think they have to announce orders from sources we already know about. So if the deal with Snam results in a specific order to build I don't think we need to be told. If I'm right then there are already enough 'orders' in the system to operate the new factory exactly on schedule.

In my opinion nearly all the cost comparisons are not fair though, as they compare on a pure financial basis. There is no assessment of the environmental cost from the steam reformation method. I'm pretty sure applying a carbon tax across the steam reformation value chain would make electrolysis far more compelling. People should not be allowed to pollute for free.

Remember Carlton it's not all about energy from hydrogen either. There is a current industrial market for hydrogen in the order of 70 million tonnes annually (globally). If that were required to be green, through electrolysis, would take 482GW of electrolysers.

The question about GW capacity was asked at the AGM on 29th October. Here is the question and the response from GC.

How do you define MW capability - is it power used in electrolysis or power stored in the hydrogen produced? What is the efficiency achieved when electrolysing and then recovering power from the hydrogen?

"It's electrons absorbed, the electricity load that is presented by the electroliser that is the megawatt rating and the efficiency is around 70% unless you're recovering heat and if you're recovering heat the only announcement we've made about that are the measurements made by RWE which take you to about 86%."

Laughton, I think your numbers are fine. Assume about 20MW per week a couple of years from now. But considering the size and infrequency of the deals we hear about (from various companies, not just ITM) the sales team are going to have to get their skates on to keep that sort of order flow coming in. It is possible though given the market potential out there.

...but it may still be new to a lot of the wider investment arena so we might still expect some positive reaction in the short term.

With thanks to Bellers for keeping us up to date with factory progress, for most of us who post here today's rns isn't really news. It's very welcome, but it isn't new.

I suspect the Nel deal with Everfuel for the Shell electrolyser will be of their alkaline type rather than PEM. My only reasoning is that I've seen Nel be specific about PEM in the past, but not this time. If Shell can afford the space for alkaline and don't need the slightly faster response time of PEM then maybe the Nel Alkaline still beats ITM on capital expense.

Indebt1, for what it's worth here is a subset of my positives and negatives...

Negatives first...
1. The financials at the next trading statement are not going to look good. They only take us to end Oct 2020 and we know the factory was not yet operating and we know roughly what orders looked like. That's past history and so cannot be changed. Some less informed investors could easily take fright at that point and sell, so you could get yourself a better entry point there. However if the company statement on current state of play and near term forecast are very positive then that could easily outshine the poor numbers.

2. ITM have still to prove they can scale up the orders and production to match today's valuation. If they fail with either then the share price penalty could be dramatic. If investors are patient enough to let that play out over the next couple of years then the price should hold/grow as it unfolds. Many investors are not that patient though so high volatility is likely over that period.

Positives...
3. Comparing to similar manufacturers in the FTSE100, a full factory and steady orders easily justifies a £10bn market cap so still up around 4x from here. So opening a starting position here with at least a 5 year time horizon could still work out coupled with opportunistic top ups if major falls arise due to the above negatives.

4. If the full factory and steady orders is achieved then it confirms the huge market for green hydrogen and a second factory will be built so you can almost double the £10bn mentioned above. It may even not stop at two factories. Personally I can envisage 5 geographically strategic factories.

Best of luck whatever you decide to do.