Troubled hydrogen electrolyser maker ITM expands factory space by 62% in bid to 'debottleneck' production

Troubled hydrogen electrolyser manufacturer ITM Power is to expand the factory space at its Sheffield facility by 62%, in a bid to “debottleneck” its production backlog and put the company back on track after a turbulent few months that saw its stock price plummet.

The company has signed a 15-year lease for an additional 83,000 square-feet of factory and office space at its 1GW Bessemer Park base, that it will use as a dedicated research and development and product validation facility.

The move will free up ITM’s existing 134,000 square-foot factory for higher volume output, allowing it to ramp up the fabrication of its proton exchange membrane (PEM) electrolyser products.

It is not clear whether the figure will actually increase the GW-capacity of ITM’s facility, or allow it to meet its existing 1GW stated capacity. ITM was unavailable for comment at the time of publication.

It will also consolidate ITM’s staff from a number of disparate locations throughout Sheffield to one single base, allowing employees to “to work together more effectively”, ITM said, as well as providing science laboratories and testing facilities for future product development.

The company has not disclosed the cost for leasing the extra space, but it is believed to have up to £270m (£334m) of cash on its books after raising £242m in capital last year.

The research centre was first announced in January, as part of a raft of proposals instigated by incoming chief executive Dennis Schulz on the back of the company’s failure to meet its production targets — a situation that had resulted in dire financial results and stock performance.

It admitted that it had underestimated the challenges of transforming from a start-up to a high-volume electrolyser producer, which had resulted in unrealistic production targets.

ITM is projected to post adjusted losses of up to £95m in 2023 against revenues of just £2m, while its share price continues to dwindle at around £0.86, down from £3.94 at the end of 2021.

In an effort to meet ITM’s production targets, Shulz has also reduced ITM’s product offering from 15 to two.

“We are well on track on delivering against our 12-month plan laid out in January,” Schulz said today (Monday) regarding the new factory space. “One of our priorities was the need for ITM to strengthen product validation and to debottleneck factory space and product testing. Today’s announcement is not only a critically important step on our journey to scale up manufacturing, but it will also enable the focussed development of future technologies.”