The British government has formally signed off on an £86.5 million package for ITM Power, clearing the way for a 1-gigawatt electrolyser production line in Sheffield. The funding — split between a £46.5 million grant from the Department for Energy Security and Net Zero and a £40 million equity injection from Great British Energy — was first flagged in April but only received final regulatory approval on 12 July, when the UK Subsidy Control Authority removed the last hurdle. Yet for all the official enthusiasm, the stock market is taking a wait-and-see approach.
ITM Power’s shares closed at €1.25, a level that sits 51.6% below the May peak of €2.58. The annualised 30-day volatility stands at 99.55%, a figure that underscores just how violently the stock can swing in either direction. On a year-to-date basis the shares are still up 71.88%, but the retreat from the spring high has been stark. Technical indicators reinforce the caution: the stock is trading roughly 20% below its 50-day moving average, with a relative strength index of 42 pointing to neither oversold nor recovering territory. It remains about 24% above its 200-day average, suggesting the longer-term trend has not broken, but the short-term mood is clearly fragile.
The cash injection is earmarked for ITM Power’s next-generation “Chronos” electrolyser technology, which the company claims will deliver lower costs and higher efficiency than existing products. The new line will be installed in existing factory space in South Yorkshire, reducing some of the execution risk that typically haunts greenfield projects. Under the terms of the grant, ITM Power must add roughly 250 jobs in the UK over the next five years. CEO Dennis Schulz has described the funding as a crucial step towards anchoring the company at the heart of Britain’s hydrogen economy.
But capacity is one thing; orders are another. Alongside the manufacturing expansion, ITM Power is deepening its partnership with Protium Green Solutions. The first joint project, Cromarty in Scotland, envisions a 15-megawatt electrolyser capable of producing around 7 tonnes of green hydrogen a day for industrial customers. A final investment decision is targeted for December 2026. That date is now a key marker for investors: a positive verdict would signal that the partnership can convert state-backed production capacity into real revenue.
Should investors sell immediately? Or is it worth buying ITM Power?
The company’s cash guidance for the 2026 financial year has been upgraded to a range of £210-215 million, an improvement on the previous forecast. Yet profitability remains elusive, a familiar story across the green hydrogen sector. Competitors such as Nel ASA, Plug Power, Siemens Energy, ThyssenKrupp Nucera and McPhy Energy are all chasing the same pool of industrial customers, and the market for electrolysers is becoming increasingly crowded. The technology — proton exchange membrane in ITM Power’s case — has yet to prove it can scale profitably.
The bull case rests on a combination of state backing, a proven factory footprint, and what the company describes as step-change improvements in cost and performance with Chronos. The bear case, meanwhile, points to the familiar risks of the hydrogen industry: project delays, uncertain demand growth, and a persistent reliance on public money and capital markets to fund operations. With a market capitalisation of roughly €910 million, ITM Power is no longer a micro-cap, but it is still a long way from the established industrial margins that would justify a more stable valuation.
In essence, the funding removes one layer of financial uncertainty from the equation. What remains is the harder question: can ITM Power fill its gigawatt factory with paying customers before the next bout of market scepticism arrives? The Cromarty decision in 14 months will offer an early test — not just of the Protium partnership, but of whether government millions can truly be turned into a self-sustaining business.
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