Deal pipeline increased by £5.9m in the past two months
ITM Power (AIM: ITM), the energy storage and clean fuel company, announces an update on trading and operations for the period since the announcement of its successful placing and open offer on 29 September 2017. The Company maintains its focus on increasing commercial sales and currently has £20.2m of projects under contract and a further £22.4m of contracts in the final stages of negotiation. The total of £42.6m is an increase of £5.9m in the two months since the placing and open offer announcement.
Products in Build
ITM Power continues to process its current order book. Today, the Company has 12 units within its manufacturing facility in Sheffield which are either in build, undergoing factory acceptance testing or ready for shipment. An additional five units are being commissioned in the field ahead of coming online. Altogether, these 17 units constitute over 5MW of installed capacity. The production plan starting in 2018 already exceeds 15MW of capacity.
In line with the Company’s growth strategy and manufacturing plans, the order backlog and opportunity pipeline demonstrates a clear trend towards bigger unit sizes and larger scale industrial applications. The backlog is also reflective of the Company’s focus on commercial sales and shift away from its previous reliance on grant income. In order to accommodate the increased numbers and size of units in production, Heads of Terms are being negotiated for a relocation to a larger facility which will accommodate all functions of the Company.
Power-to-Gas; Energy Storage
The National Grid HyDeploy project is well underway and excellent progress has been made across the programme. The HyDeploy project seeks to address a key issue for the UK, namely how to reduce the carbon footprint as a result of heating homes. The UK has a world class gas grid delivering heat conveniently and safely to over 83% of homes.
Emissions could be reduced by lowering the carbon content of gas through blending with hydrogen. HyDeploy is a Network Innovation Competition (NIC) funded project which aims to establish the level of hydrogen that can be safely blended with natural gas for transport and use in the UK gas network.
ITM Power has started work examining the potential deployment of large-scale Power-to-Gas energy storage within the boundaries of the Northern Gas Networks gas distribution system. The work, funded by the Department for Business, Energy and Industrial Strategy (BEIS) as part of the Energy Storage Feasibility Study Competition launched in January 2017, will be completed in Q1 2018.
BEIS is also undertaking a £25 million project to explore the potential use of hydrogen gas for heating UK homes and businesses. The project will run from 2017 to 2021 and will aim to define a hydrogen quality standard, and to explore, develop and test domestic and commercial hydrogen appliances.
Hydrogen Refuelling Station (HRS) Deployment
ITM Power has a total HRS portfolio today of 12 funded refuelling stations which it owns. Five stations are open to the public: Riverside (US), AMP (Rotherham), NPL (London), CEME (London) and Cobham (London). A further five HRS are in construction: Birmingham (bus HRS), Orkney (Kirkwall), Beaconsfield (Shell forecourt), Gatwick (Shell forecourt) and Swindon. A further two HRS also have Fuel Cells and Hydrogen Joint Undertaking (FCH JU) funding under the H2ME2 scheme. The UK refuelling network has been financially supported by Innovate UK, Office for Low Emission Vehicles (OLEV) and the FCH JU.
Planning permission has been granted for car and bus HRS at 19 sites in total with 14 different planning departments across the UK. Business development activities in the clean fuel area are now focussed on return-to-base commercial vehicles including buses, trains, trucks and shipping. ITM Power has entered into 17 hydrogen fuel supply contracts for refuelling fuel cell electric vehicles: Honda, Toyota GB PLC, Hyundai Motor UK Ltd, Commercial Group, Skanska, UlemCo Ltd, Arval UK Ltd, UK Government Car Service, Arcola Energy, Johnson Matthey, Europcar, The Science Museum, JCB, Anglo American, Green Tomato Cars, Yorkshire Ambulance Service and Northern Gas Networks.
On 13 November the Hydrogen Council published a first-of-a kind study detailing hydrogen’s potential to be a key pillar of the energy transition. The study concluded that when deployed at scale, hydrogen could account for almost one-fifth of total final energy consumed by 2050. This would reduce annual CO2 emissions by roughly six gigatons compared to today’s levels, and contribute roughly 20% of the abatement required to limit global warming to two degrees Celsius.
The Company’s marketing efforts have been focused on engagement with multi-national companies which operate within the energy and transport sectors. In addition, increasingly by invitation, ITM Power attends and presents at many industry specific trade fairs and conferences in the UK, mainland Europe and the United States. A regularly updated list of all the events the company will be attending can be found at http://www.itm-power.com/news-media/events
Graham Cooley, CEO, commented, “Our strong pipeline growth reflects the hydrogen and energy storage markets’ rapid growth worldwide and ITM’s focus on commercial sales. We have larger systems, compliant to operate all over the world, placing ITM Power in a great market position. This is a very exciting time for the energy industry, and ITM Power is at the forefront of a market which will revolutionise air quality and energy storage for future generations.”
For further information please visit www.itm-power.com or contact:
ITM Power plc Andy Allen, CFO +44 (0)114 244 5111
Investec Bank plc (Nominated Adviser and Broker) Corporate Finance: Jeremy Ellis / Jonathan Wynn Corporate Broking: Chris Sim / Rob Baker +44 (0)20 7597 5970
Tavistock (Financial PR and IR) Simon Hudson / James Collins +44 (0)20 7920 3150
About ITM Power plc
ITM Power manufactures integrated hydrogen energy solutions for grid balancing, energy storage and the production of green hydrogen for transport, renewable heat and chemicals. ITM Power was admitted to the AIM market of the London Stock Exchange in 2004. In September 2017 the Company announced the completion of a GBP29.4m working capital fundraise. The Company signed a forecourt siting agreement with Shell for hydrogen refuelling stations in September 2015 and subsequently a deal to deploy a 10MW electrolyser at Shell’s Rhineland refinery. Additional customers include National Grid, RWE, Engie, BOC Linde, Toyota, Honda, Hyundai, Anglo American among others. The Company currently has £20.2m of projects under contract and a further £22.4m of contracts in the final stages of negotiation making a total of £42.6m (subject to exchange rate variation). http://www.itm-power.com/
About the FCH JU
The Fuel Cells and Hydrogen Joint Undertaking is a unique public private partnership supporting research, technological development and demonstration activities in fuel cell and hydrogen energy technologies in Europe. Its aim is to accelerate the market introduction of these technologies, realising their potential as an instrument in achieving a carbon-lean energy system. The three members of the FCH 2 JU are the European Commission, fuel cell and hydrogen industries represented by the Industry Grouping Hydrogen Europe and the research community represented by the Research Grouping N.ERGHY. http://www.fch.europa.eu/
About the Hydrogen Council
The Hydrogen Council is a global initiative of leading energy, transport and industry companies with a united vision and long-term ambition for hydrogen to foster the energy transition. Launched at the World Economic Forum 2017, in Davos, the growing coalition of CEOs have the ambition to: Accelerate their significant investment in the development and commercialization of the hydrogen and fuel cell sectors. Encourage key stakeholders increase their backing of hydrogen as part of the future energy mix with appropriate policies and supporting schemes. In the first global initiative of its kind, the Hydrogen Council is determined to position hydrogen among the key solutions of the energy transition. The Council works with, and provides recommendations to, a number of key stakeholders such as policy makers, investors, international agencies and civil society to achieve these goals. http://hydrogencouncil.com/