The investment case for hydrogen has long been framed around decarbonisation. That story is being rewritten. Rising geopolitical tensions and the voracious electricity appetite of artificial intelligence are forcing a strategic recalibration, pushing companies like Nel ASA into a new light.
A Strategic Pivot Beyond Climate
The conflict involving Iran has laid bare the fragility of global energy supply chains, with disruptions in the Strait of Hormuz rattling traders. The waterway’s critical role in oil and LNG flows has reinforced the case for structurally higher energy prices, prompting governments to seek alternatives to fossil fuel imports. Hydrogen, once viewed primarily as a climate tool, is now being positioned as a route to energy sovereignty.
Simultaneously, a fresh demand driver has emerged. AI data centres require enormous, uninterrupted power loads. Analysts estimate that by 2030, US data centres could consume roughly 7.5% of national electricity, while European demand is projected to jump by half as early as 2026. Hydrogen fuel cells, which can operate around the clock and be deployed quickly, offer a solution to ease the strain on conventional grids.
Mixed Quarterly Results, Clear Cost Discipline
Nel’s first-quarter 2026 numbers reflect a business in transition. The net loss narrowed to 144 million Norwegian kroner from 179 million a year earlier, while the EBITDA loss improved by 15 million to minus 100 million. Revenue from customers, however, slipped 5% to 148 million kroner.
The real story lies in cost control. Personnel expenses were slashed by 21%, and headcount fell by between 19% and 26%. The divisional performance was uneven: the alkaline unit grew 6%, while the PEM division contracted 14%. The order backlog stood at 1.113 billion kroner at quarter-end, down 24% year-on-year. Nel’s cash position remains solid at roughly 1.4 billion kroner, with an additional 11 million euros in expected EU funding due in the second quarter.
A Tangible Proof Point in South Korea
Amid the financial noise, a concrete operational milestone stands out. In South Korea’s North Gyeongsang province, a 10 MW plant using Nel electrolysers is now producing up to 230 tonnes of green hydrogen annually, powered by an 8.3 MW solar array. Built by Samsung C&T, the facility is the country’s first off-grid installation of its kind. For Nel, it validates that its alkaline technology can perform at commercial scale — a crucial reference for future project financing.
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Market Sentiment and Technical Signals
Investors have taken note. Nel’s shares closed Friday at €0.22 in Frankfurt, having gained 6.5% on Thursday alone. The stock now trades comfortably above its 50-day moving average of €0.19, a 13% premium that technical analysts view as a bullish signal. Since the start of the year, the share price has advanced roughly 14.5%, though it remains about 11% below its 52-week high of €0.25.
Management reports rising interest in electrolyser plants across various sizes, with particular traction in the 50 to 150 MW range. Several large-scale projects are approaching final investment decisions, which could provide the next tangible catalyst for revenue growth.
A New Compensation Framework and a Key Product Launch
At the annual general meeting on 10 April, Nel overhauled its executive compensation structure. The old stock option programme, which lacked performance conditions, has been replaced with a performance share unit (PSU) plan featuring clear criteria and a long vesting period. The CEO is now eligible for PSUs worth up to 50% of base salary, while other executives can receive up to 30%. Approximately 14.9 million PSUs have been granted.
The immediate catalyst, however, is the unveiling of Nel’s new pressurised alkaline platform on 6 May. How convincingly the company presents this next-generation technology will determine whether the stock can build on its recent gains. The half-year report is due on 15 July 2026.
The industrial hydrogen market remains in its infancy, but the convergence of energy security fears and AI-driven power demand is creating a more favourable backdrop. For Nel, the path to sustained growth hinges on converting its pipeline of large-scale projects into binding contracts — and on proving that its technology can deliver at scale.
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