🔒Green hydrogen producer Nel debuts $30M renovation of Wallingford plant

Hydrogen is the lightest element on the periodic table but is considered a heavyweight when it comes to reducing greenhouse gas emissions. 

It can be used to produce high-temperature heat to power industrial processes with zero-carbon emissions, while also playing a role in powering electric fuel cells. 

While hydrogen has tremendous potential for helping with decarbonization in the fight against global warming, it is hindered by the cost of producing it cleanly — which makes an event held Wednesday in Wallingford a step in the right direction.

Nel Hydrogen, a Norway-based company that produces clean hydrogen from renewable resources, hosted local, state and federal officials, and current and potential customers from around the world, to celebrate its newly renovated and expanded facility at 10 Technology Drive.

The global company, which reported $333.7 million in revenue but a net loss of $104.8 million in the third quarter of 2024, invested about $30 million to renovate and modernize its approximately 100,000-square-foot manufacturing facility to increase its capacity for producing electrolyzers, which use electricity to separate hydrogen and oxygen from water.

While the two-year renovation didn’t alter the building’s exterior footprint, Nel converted about 8,100 square feet of formerly leased office space to expand its nearly 52,000-square-foot production space by about 15%, according to Tushar Ghuwalewala, vice president of operations.

It also installed computer-controlled robotic arms and other equipment that automated about 95% of the production process, including assembly and testing, among other steps, company officials said. 

Where it used to take a group of people two to three days to manually assemble one electrolyzer unit, robots now assemble two units in one shift, the company said.

Making production more efficient enabled Nel to earn a $4.9 million grant from the U.S. Department of Energy that is intended to help reduce the cost of producing clean hydrogen.

Håkon Volldal, president and CEO Nel ASA, the parent of Nel Hydrogen, said modernizing the Wallingford facility enables it “to produce 10 times as many … electrolyzers as we could in the past at a 30% lower cost than we were able to do in our old factory.”

Still, he said, “Even though 30% sounds amazing, and it is substantial, it’s not enough. Green hydrogen will still be much more expensive than, for example, natural gas.” 

He added that Nel has partnered with General Motors in Detroit to develop the “next-generation” electrolyzer that will “reduce costs by another 60% from the already reduced level, and reduce energy consumption by more than 10%.”

Federal investment

Sunita Satyapal, the director of the Hydrogen and Fuel Cell Technologies Office of the U.S. Department of Energy, attended the event and praised Nel’s efforts to reduce the cost of clean hydrogen. She also said the federal bipartisan infrastructure law signed by President Biden in 2021 includes a National Clean Hydrogen Strategy. 

“Your 5-year-old should know that ‘50 by 50’ is our goal,” Satyapal said. “So (producing) 50 million metric tons of clean hydrogen by 2050, and that’s five times more. Today, the U.S. produces roughly 10 million metric tons of hydrogen. … If we get there, hydrogen would enable up to 10% total emissions reduction.”

She added that the U.S. has invested more than $500 billion in clean technologies and infrastructure since Biden took office. “And for every $1 invested by the federal government, the private sector has invested $6,” she said, adding that private companies have announced plans for 800 new expanded clean energy factories, and that U.S. employers have added more than 400,000 clean energy jobs during Biden’s term.

Satyapal was in Connecticut almost a year after the state and the Northeast came up losers in a high-stakes competition for regional hydrogen hubs.

A seven-state consortium led by New York and including Connecticut and the rest of New England except New Hampshire, plus New Jersey, were not among seven hubs selected to share $7 billion in funding for green hydrogen investment. 

The decision was especially disappointing for Connecticut, which has decades-long history with hydrogen, a necessary component of its well-known and regarded fuel cell industry.

Don't fear automation

Ghuwalewala said Nel has about 150 employees and has been adding staff despite the automation, primarily for its research and development efforts.

Paul Lavoie, the state’s chief manufacturing officer who also runs the Office of the Clean Economy for the state Department of Economic and Community Development, said automation does not automatically mean fewer jobs.

“There are never going to be enough people to meet the needs in the manufacturing sector, to meet the workforce needs,” Lavoie said. “We have to come to the realization that the only way that we are going to compete on a global basis is through industrial automation.”

“This is never a job-replacement strategy or a job-elimination strategy,” he continued. “There are no people to do this work. What it does is it takes people and it upskills them and it reskills them and it gives them more meaningful work that they’re able to do and it increases their opportunity for economic equality.”

Sen. Richard Blumenthal, who co-chairs the bipartisan Hydrogen and Fuel Cell Caucus in the U.S. Senate and attended the event, also congratulated Nel on its upgraded facility. He said Connecticut is a global leader in fuel cell manufacturing and technology “because of companies like Nel,” and that clean hydrogen “is part of America’s future.”

“We know that hydrogen fuel cells create jobs, they preserve jobs,” Blumenthal said. “They lower emissions. They are applicable in so many different contexts. … I think the future is bright.”

A CT Mirror report contributed to this story.