ITM Power plc (LSE:ITM) confirmed that a previously announced 20 MW Notice to Proceed relates to MorGen Energy’s West Wales Hydrogen project in Milford Haven, which has now reached final investment decision under the UK government’s Hydrogen Allocation Round 1 (HAR1) funding framework.
The project will see ITM supply its 20 MW POSEIDON electrolysis module for installation at a facility located on the site of the former Milford Haven Refinery in Wales. Once operational, the plant is expected to produce approximately 2,000 tonnes of green hydrogen each year, supplying industrial users across Milford Haven, Port Talbot and the wider Welsh industrial region. Commissioning of the facility is planned for 2028.
Alongside the equipment contract, ITM has also signed a ten-year long-term service agreement with MorGen Energy to support the facility’s ongoing operation. The agreement covers maintenance and operational services for the electrolysis system and is expected to provide recurring revenue for ITM over the life of the contract.
The project represents an important step in the development of large-scale green hydrogen infrastructure in the UK and reinforces the bankability of ITM’s electrolysis technology. Management believes the contract strengthens the company’s position in industrial decarbonisation initiatives as demand for low-carbon hydrogen solutions continues to grow.
Despite these strategic wins, the company’s near-term outlook remains constrained by financial factors. ITM continues to report operating losses and negative operating and free cash flow, while technical indicators point to a bearish share price trend with the stock trading below major moving averages. However, operational progress has been evident, including record first-half revenue, improving order backlog quality and reaffirmed growth guidance. The company also maintains a relatively low-leverage balance sheet, although profitability and cash flow timing remain key risks.
More about ITM Power
ITM Power plc, founded in 2000 and listed on London’s AIM since 2004, is headquartered in Sheffield and specialises in proton exchange membrane (PEM) electrolysers used to produce green hydrogen from renewable electricity and water. The company focuses on supplying advanced electrolysis technology to support industrial decarbonisation and the development of the emerging green hydrogen economy across the UK and Europe.
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