Nel ASA adjusts capacity of its Herøya plant to market demand

In Norway, Nel ASA and its subsidiaries have initiated a process to adjust capacity to market demand by reducing the workforce and temporarily halting production at the Alkaline production facility in Herøya, Norway. The firm explained that the market for renewable hydrogen production technology has been slower than expected for the industry in general. Order intake in 2023 and 2024 fell short of expectations, and several customer projects are significantly delayed or are at risk of being cancelled, the firm added. As a result, Nel has limited need to produce new alkaline electrolyser equipment in the near-term and will adjust its production and organizational capacity correspondingly. “While the long-term outlook for clean hydrogen remains strong, we must make some tough decisions today based on lower order intake in 2024 than expected,” said Nel’s President and CEO, Håkon Volldal. Nel has decided to halt production in Herøya temporarily. This will predominantly impact the Norwegian workforce in the Alkaline business segment. The planned reductions will affect roughly 20% of the full-time employees reported at the end of the third quarter 2024. Approximately half of the reductions have already been executed in the fourth quarter of 2024 through voluntary resignations and termination of consultants, the firm added. Nel continues to see a strong pipeline of clean hydrogen projects and is actively working on several concrete bids, including projects where Nel is currently undertaking paid front-end engineering design (FEED) studies.

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