number one by nature
2021
ANNUAL
REPORT
The publication can be downloaded on
nelhydrogen.com
Title:
Annual report 2021
Published date:
22 March 2022
info@nelhydrogen.com
+47 23 24 89 50
Karenslyst allé 49, PB 199 Skøyen,
0212 Oslo, Norway
Table of contents
Annual report 2021
1 Letter from CEO .................................................................................... 5
2 Member of the board ............................................................................ 9
3 Management ......................................................................................... 10
4 Report from the Board of Directors ..................................................... 13
4,1 Financial development ................................................................ 16
4,2 Environment, Social and Governance reporting ........................ 29
4,3 Risks and opportunities ............................................................... 46
4,4 Outlook ......................................................................................... 47
5 Board of Directors’ report in relation to the
Norwegian code of practice for corporate governance ..................... 50
6 Consolidated financial statements 2021 Nel group ........................... 56
6,1 Notes to the consolidated financial statements ........................ 64
7 Parent company financial statements ................................................ 120
7,1 Notes to the parent company financial statements .................. 128
8 Alternative performance measures .................................................... 145
9 Auditor’s report ..................................................................................... 146
“The alarm bells are deafening, and the evidence is
irrefutable: greenhouse gas emissions from fossil fuel
burning and deforestation are choking our planet and
putting billions of people at immediate risk”.
These words belong to the UN Secretary-General
António Guterres and were uttered when the
Intergovernmental Panel on Climate Change (IPCC)
published its report on climate change in September
last year. Guterres also called the report, “A code red for
humanity”.
The message is clear and alarming. We must act now to
avert a climate catastrophe. At the same time the IPCC
leaves a small glimmer of hope and a reason to remain
optimistic. There is still time, but we need to act now.
We must work faster.
Even though the task is overwhelmingly huge, it feels
good to be part of an industry that has the potential to
become an important solution to the climate crisis.
Today, production of cement, steel and fertilizer
accounts for more than 17 percent of the world`s total
greenhouse gas emissions. Changing from fossil-based
fuels to green hydrogen will have a large and positive
effect on the global emission figures. Similarly, the need
for zero emission solutions within the transport sector,
a sector that accounts for 15 – 20 percent of all climate
emissions, becomes more and more urgent and longed
for with each passing day.
Needless to say, I am not the only one who see this
picture. Politicians, investors, and businesspeople alike
have come to understand and accept that the energy
transition and global decarbonization will not happen
without hydrogen. As a result, we have seen more than
500 hydrogen projects announced in 2021, equivalent
to USD 160 billion in potential direct investments. This
represents an increase of 100% from 2020. Incentives
to accelerate the deployment of hydrogen are being
discussed and implemented almost everywhere. This
creates plenty of opportunities for Nel.
During the last year we have seen an unprecedented
growth in our pipeline of new projects, and we have an
organization of approximately 90 inhouse employees
and 50 people from various EPC-partners working day
and night to develop this pipeline into new contracts.
In just a couple of years we will see green hydrogen
projects that are much larger than the ones being
developed today. Today the biggest European hydrogen
plants are approximately 20 MW, but we will soon see
green hydrogen plants in new geographical markets,
with abundant resources of wind and solar, as big as
800 MW and beyond. We are therefore investing a lot of
capital in the development of large-scale concepts and
are now capable of delivering 20 MW building blocks
to 20, 200, 800 MW concepts and beyond. Customer
groups, project sizes and geographical markets will
become broader. This means that our independent
partnership model will provide a great advantage
because we can join forces with companies that have
world-class knowledge within their fields and tailor the
competence profile on each team to meet the individual
needs of each customer.
We have the wind at our back, which is good, when time
is of the essence. And I can assure you that we spend
every hour of the day contributing the best way we
can, which is to bring down the cost of production of
green renewable hydrogen to a level below the cost of
hydrogen produced from fossil fuel.
Today, close to all hydrogen, which amounts to dizzying
70 million tons per year, is being produced using fossil
sources. Outcompeting fossil fuel-based hydrogen is
therefore crucial for the necessary transition to a zero-
emission society. We are firm in our aim to reach this
milestone already in 2025 based on our target to offer
technology that can produce green renewable hydrogen
at USD 1,5 per kilo.
A giant leap forward to this milestone was reached in
October last year when we started initial production at
our new manufacturing facility at Herøya in Norway.
Currently, this is the world’s largest production facility
for electrolysers, bringing significant efficiencies of
scale and automation to bear on our cost reduction
plans. We are looking forward to meeting again with
many key partners and stakeholders of Nel when we will
celebrate the opening of our new facility in the spring of
2022.
Similarly, we continue to take steps in our fueling
division. Our ultimate target is to make it easier,
cheaper, and more convenient to fill up a hydrogen
vehicle than one that runs on diesel or petrol, and at the
1 Letter from the CEO
Nel ASA
I
Annual report 2021
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Best regards,
Jon André Løkke, CEO
same time provide longer driving range. It is fair to say
that we still have some way to go, but we are definitely
moving in the right direction.
During 2021, we delivered a large number of fueling
stations intended for both small and large vehicles to
the European and US markets. In July, the Mayor of
London, Sadiq Kahn, proudly announced that the first
fleet of hydrogen buses were ready to hit the streets
of England`s capital fueled by our technology. Once
a day, twenty hydrogen double decker buses stop by
the brand-new hydrogen fueling station at Metroline`s
Perivale depot, delivered by Nel, for a five-minute break
to fill up their tanks.
Thanks for the ride, folks
In the very beginning of 2022, we announced that I will
resign as CEO in June. A new and highly qualified leader
will take over my current role. I am glad the nomination
committee has stated that it will recommend that I
continue to participate in the development of Nel, as a
member of the Board of Directors.
I have had the pleasure of being CEO of Nel for more
than six years, and the passion for our people and
solutions have grown bigger with the years. It has
been a fantastic journey. When I started, we were only
three people at the headquarter, just over a dozen
at Notodden, Norway, and around 30 in Herning,
Denmark. Today Nel is nearing 600 employees, who
have developed our company into a world leader within
a field that will be crucial in the transition to a zero-
emission society. I am extremely proud of what we have
created together.
Though there is a long way to go before we reach our
goals, I know that we have a strong organization with
competent and skilled people that have what it takes to
fulfill the full potential of Nel.
So, thanks for the ride, folks. Even though I still will be
helping with the journey, I trust that our competent new
CEO and the knowledgeable and hard-working people
of our organization will take it from here.
6
Letter from the CEO
MORE THAN 90 YEARS OF HYDROGEN INNOVATION.
AND THAT’S JUST THE BEGINNING.
PIONEERING RENEWABLE HYDROGEN
FOR MORE THAN 90 YEARS
Starting up the Herøya plant, first line
Setting new record order sizes with orders from Nikola, Everfuel, Iberdrola and Iwatani
Corporation
Nel opens first H2Station™ in Korea
Nel announces construction plans for the world’s largest electrolyser
manufacturing plant to accommodate multi-billion NOK orders
Nel completes construction of the world’s largest manufacturing
plant for hydrogen fueling stations, with a capacity of 300 units per
year
Nel acquires Proton OnSite, adding world leading PEM
electrolysis technology to product portfolio, becoming the
world’s largest electrolyser company
Nel acquires H2 Logic, adding world leading hydrogen
fueling technology to the product portfolio
Nel becomes the first 100% dedicated hydrogen
company listed on the Oslo Stock Exchange
Nel opens the world’s first publicly available hydrogen
fueling station in Reykjavik, Iceland
Our first pressurised electrolyser introduced to the
market
The world’s first electrolyser supplier to provide non-
asbestos alkali electrolysers
Our renowned electrolyser technology made available for
other companies and other industries
Complete redesign of the electrolyser unit, forming the basis
for today’s atmospheric electrolyser from Nel
Starts up a second large scale hydropowered electrolyser plant
for supplying hydrogen to ammonia production, in Glomord,
Norway
The largest installation in the world of water electrolysers at Rjukan,
Norway, with a total hydrogen production capacity exceeding 30.000
Nm3/hour, from hydropower
The first small electrolyser installation at Norsk Hydro, Notodden, Norway.
Testing for pure hydrogen to fertilizer production
2021
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