Nel Hydrogen

October 23rd, 2018

Jon André LøkkeCEO

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The color of hydrogen

On the hydrogen emission spectrum we find the color purple, with a wavelength of 410 nm. Nel is the color of hydrogen.

Nel in brief

• Global, listed pure-play hydrogen company – facilities in Norway, Denmark and the U.S., ~16,000 shareholders

• Significant foothold in fast-growing markets with several breakthrough contracts

• World-leading on hydrogen electrolyzers and fueling equipment – unrivalled performance and track-record

• >3,500 hydrogen solutions delivered in ~80 countries world wide since 1927

• ~40 hydrogen fueling stations delivered to 9 countries, and delivering to South Korea in 2019

• Capable of delivering solutions to produce, store and distribute hydrogen from renewable energy

Hydrogen Electrolysers Hydrogen Fueling Hydrogen Solutions

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Nel Hydrogen Electrolyser

• Global leader in water electrolysis based hydrogen production plants

• highest uptime, lowest conversion cost, robust and reliable

• Scalable production capacity for industrial and energy/transport applications – small scale to large scale

solutions

• Alkaline & PEM electrolysis, also <10 bar ideal for the Japanese market

Containerized solutions

Up to 1000kg/day

Large scale plant solutions

Up to any capacity

Nel Hydrogen ElectrolyserProduction and installation of water electrolysers for hydrogen production

Alkaline and PEM electrolyzers

Scalable and modular

Solar Grid Wind

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Nel Hydrogen Fueling

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• Global leader within hydrogen fueling solutions for

vehicles, adapted to latest fueling standards

• Delivered ~40 stations in 9 countries across

Europe, US and Asia – CE & UL approved

• Highest reported availability and innovative, in-

house developed technologies

World’s largest manufacturing

facility for H2Stations®:

300 station per year capacity

Nel Hydrogen FuelingProduction of hydrogen fueling stations for cars, buses, trucks, forklifts and other applications

Dispenser assembly 5-stage H2Station® assembly

H2Station®

70MPa

35MPa

35MPa

Nel Hydrogen Solutions

• Unified delivery of complex renewable hydrogen solutions, efficient system integration, project development

and sales across segments

Nel Hydrogen SolutionsUtilizing market opportunities across the Nel group and offers complete solutions to customers

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• Sole provider of integrated solutions along the

entire value chain:

1. Fueling Networks

2. Renewable Hydrogen & Storage Solutions

Fossil parity-

renewable hydrogen from electrolysis reaching a tipping point

“…We want to change the world and make renewable hydrogen mainstream,

not a niche product like it is today…”

Global hydrogen marketGeneral market update

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Global hydrogen market, by end-use:

Ammonia Refineries

Methanol Other

• ~55 million ton/year market (~150 BUSD)

• 15% merchant market (5 – 15 $/kg)

• 85% on-site (~2$/kg)

• Only 1% from water electrolysis today, rest from SMR/gasification

• Large potential for growth, driven by increasing focus on:

• climate and renewable energy

• decreasing electricity prices

• decreasing electrolyser CAPEX

• Special focus on refineries and green ammonia

• Account for ~80% of market

• Assuming that total market is supplied by electrolysis, annual market potential would be >20 B$/year

Large opportunities for electrolysis within existing hydrogen market

Renewable hydrogen from electrolysis becoming more and more competitiveGeneral market update

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Large scale steam methane reformers

Nel large scale alkaline electrolysis

$/kW

SMR – CapEx range

*incl. service, maintenance & operation**electricity

Cost split of H2/Kg

CapEx* OpEx**

CapEx: Electrolyzers from Nel -becoming competitive with SMR

OpEx: Renewable energy already enables fossil parity for hydrogen

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Source: Pareto Securities, LazardEUR/USD: 1:1.2

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1.8

5.0

4.5

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4.9

FOSSIL PARITY: FUEL

FOSSIL PARITY: INDUSTRY

U.S

. cents/

kWh

>700 $/kWhistoric capacity

<500 $/kWunder construction

<350 $/kWfuture scale-up

Current markets served by electrolyzers

Power-To-X(ammonia, refineries, methanol,

steel/titanium. etc)

Chemical Industry Power IndustrySteel Industry

Food Industry Glass Industry Polysilicon Industry Transport Sector

Historical market New markets

Laboratories

Life support

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New markets, Power-To-X

Power

POWER-TO-PIPELINE (GAS)

POWER-TO-FUEL (TRANSPORT)

POWER-TO-POWER (ENERGY STORAGE)

POWER-TO-LIQUID (BIOFUEL)

POWER-TO-NH3 (GREEN AMMONIA)

POWER-TO-CH3OH (GREEN METHANOL)

POWER-TO-CH4 (GREEN METHANE)

POWER-TO-STEEL/TITANIUM (CO2 FREE)

• Hydrogen from electrolysis will be key in producing large quantities of sustainable energy in various forms

• Ability to adapt to diverse and intermittent renewable energy sources becoming increasingly important

Unparalleled position of electrolysis in producing other green energy forms

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H2

+ CO2

+ CO2

POWER-TO-REFINERIES

Hydrogen is becoming relevant in all forms of transportation

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hydrogen solutions

How we reach fossil parity…

Awarded multi—billion NOK electrolyzer and fueling station contract by Nikola

• Developing Nikola’s hydrogen station

infrastructure in the U.S.

• Multi-billion NOK electrolyzer and fueling

station contract, to be deployed from 2020

• Nikola received order from Anheuser-

Busch and raised capital

• Up to 800 Nikola trucks

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The transformational Nikola partnership

Contract for delivery of up to 448 electrolyzers / 1 GW of electrolysis

Constructing the world’s largest electrolyzer manufacturing plant

• Highly automated and designed according to lean manufacturing

principles

• Industrial scale electrode production of the markets most efficient

electrolyzes at a game changing cost

• Manufacturing plant will be constructed as an extension of the

current facility at Notodden, Norway

• Operational in 1H’20 with ramp-up aligned to customer

requirements

• Aiming at system cost reduction of more than 40%

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Construction of mega-factory

Name plate capacity of 360 MW per year, more than 10x current

annual production

Making renewable hydrogen mainstream – Changing industries

• Targets to make electrolysis an attractive and

renewable alternative to steam methane reforming

of natural gas (SMR)

• 20 MW standard electrolyser unit, producing 8 tons

of hydrogen per day at a cost comparable to SMR

• Large scale production combined with CapEx

efficient design

• Sharing common infrastructure, like gas separator

tanks, transformers, rectifiers, etc.

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Construction of mega-factory

Cost efficient alternative to natural gas reforming

8-cluster electrolyzer solution, produces 8 tons of hydrogen per day

Adm. + R&DProduction/Assembly

/logistics

Have developed the largest H2Station plant in the world

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• World class production and development facility

• Enables UL-certified standardized production

• Name-plate production capacity of ~300 stations/year

• Price: ~1 M€/station (500/1500 kg/day at 700/350 bar)

Nel Hydrogen Fueling

Japan still needs deregulation to enable a true, commercial hydrogen market

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1. Japan announced a deregulation process several years ago, Nelwould like to see a stronger efforts in this area:

• Will make introduction of hydrogen much less costly and more efficient – also enabling Japanese companies to compete internationally

2. In order to accelerate international standardization in Japan, should allow METI to establish and operate proven international hydrogen stations:

• Start with non-commercial facility (e.g. HySUT), then expand to commercial stations

Adopting international standards will accelerate H2 deployment & reduce cost significantly

Hyundai’s new FCEV NEXO just launched in Norway – looking forward to next gen. Toyota

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Number one by nature