European electrolyser manufacturers have reported sharply lower order intake for the latest quarter, a trend that implies the recent slowdown in the green hydrogen sector has yet to run its course.

Norwegian company Nel saw second-quarter order intake fall by 74% year-on-year, while its order backlog contracted by 40% year-on-year and by 14% from the previous quarter.

“The fact that we are working on an increasing number of FEED studies with strong industrial counterparties, coupled with a more favourable policy outlook in both the EU and the US, suggests the worst may be behind us, although the timing of a market uptick remains difficult to predict,” said Hakon Volldal, president and CEO of Nel.

“The timing of a market uptick remains difficult to predict” Volldal, Nel

Germany’s Thyssenkrupp Nucera reported a 75% year-on-year drop in its third-quarter order intake, including electrolysers and chlor-alkali technology.

The value of its order backlog for green hydrogen technology as of the end of June was down by two thirds from the same time last year. The company said the “difficult situation on the international hydrogen market in particular weighed on the group’s order development due to project postponements”.

Despite the industry’s challenges, Werner Ponikwar, CEO of Thyssenkrupp Nucera, defended the role of green of green hydrogen in the transition, although he stopped short of predicting when sentiment might rebound.

“Green hydrogen, a climate-friendly energy source, is and will remain the central pillar of the decarbonisation strategies required by industry worldwide,” he said. “The growth prospects for the hydrogen market remain intact, despite the challenges currently facing the global hydrogen market.”

Reality check?

The first half of 2025 saw multiple project cancellations and postponements against a backdrop of political uncertainty, rising costs and the continued reluctance of industrial offtakers to commit to switching to expensive green hydrogen-based feedstocks. The most visible rethink on green hydrogen is evident among the oil and gas majors as they refocus on their core fossil-fuel businesses, and lose patience with the high risk and low returns of the green hydrogen sector.

UK-based BP, which is under huge pressure from shareholders to boost returns, has been particularly aggressive in pulling back from the sector. In July, it stunned the industry with a decision to exit the Australian Renewable Energy Hub (AREH) mega-project in the Pilbara region, in a blow to Western Australia’s green hydrogen ambitions and to global green hydrogen sentiment.

The oil major is the operator and biggest shareholder in AREH, one of the world’s largest projects, with a 63.57% take, alongside developer InterContinental Energy with a 26.39% holding and Serbia-based CWP Global with a 10% interest.

BP said its exit from the project—which envisages green hydrogen production of 1.6mt/yr with 26GW of renewable power capacity—reflects it recent change in strategy.

The loss of confidence in the green hydrogen story is not confined to the oil majors. Norwegian firm Statkraft, Europe’s largest generator of renewable power, has called a halt to new green hydrogen projects. “Power price expectations are reduced for the upcoming years, while technology costs have increased—most notably in hydrogen and offshore wind, where markets have progressed slower than previously expected,” the company said in its latest earning report in June.

The demand side has also taken some hits this summer. Major European automotive manufacturer Stellantis said it has halted its development of hydrogen-powered light commercial vehicles and scrapped the launch of a planned new range of vans, claiming the hydrogen market has “no prospects of mid-term economic sustainability”.

Timing is everything

Thyssenkrupp Nucera cited project postponements, rather than permanent cancellations, as a drag on its order book. There is no doubt the ambitious timelines set out by developers and policymakers is recent years have been found out.

As with all new industries, the timing of investment in the upstream, midstream and downstream needs to match up. For green and low-carbon hydrogen, the transportation infrastructure is particularly challenging.

74% – Drop in Nel’s order intake

This was highlighted in August, when the developers of the 1GW Zeevonk hydrogen project in the Netherlands said they had reduced the scope of the project and pushed back its expected startup by about three years because of delays to the associated Delta Rhine Corridor hydrogen pipeline.

“Since the [Zeevonk project] permit was granted, the pace of the energy transition has shifted,” a spokesman for the project told Hydrogen Economist. “The delay in the Delta Rhine Corridor has impacted the timeline for delivering hydrogen to the market. We aim to deliver in a pace adapted to market needs. For [the project] to succeed, supply, demand, and infrastructure must progress in alignment.”

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Author: Stuart Penson