Welcome everyone to this third quarter presentation for Nel. Welcome everyone in the room. We have a slightly bigger room today, so I hope it's a bit more comfortable. Unfortunately, we don't have wienerbrød. I know that Bent and Bjørn has been running all over Oslo to try to find some. Welcome also everyone following this over the web. As usual, you can post your questions, and we will try to answer as many as possible at the end of the presentation. As usual, we will go through the third quarter highlights, the financial highlights. We will talk a bit about Nel in brief, and also other key developments of the quarter. We wanted to share a bit more information with you related to our capacity expansions that is currently in progress at Herøya.
We have summarized a lot of the general industry news, some of the industry news in the section called industry updates. We finish off with the summary outlook and the Q&As at the end. In terms of revenue, we are very happy with the development that we've seen this quarter. It's all-time high revenue for any given quarter. Close to 30% up from same quarter last year, which is good. That means that a lot of the hard work is actually finally paying off, translating the orders into revenue. The order backlog is also all-time high, even though it's only slightly up from last quarter. If you compare to the same quarter last year, we are approximately 58% higher backlog compared to the same quarter last year.
That means that we have a good backlog also going into next year, which makes us quite comfortable. In terms of other highlights, we had a relatively busy quarter again. We launched, in the beginning of the quarter, our new A1000 electrolyzer, which we'll talk a bit more about, alkaline electrolyzer. We closed the agreements with Everfuel and with the H2Bus consortium. We were proposed for DOE funding, Department of Energy funding, together with Nikola. We also signed an agreement with Yara on the development of their green ammonia project. We got two POs for stations from Korea. These were the first stations orders that we got after the [inaudible] incident, so that was quite comforting. We secured a new manufacturing location at Herøya that is capable of taking up to one gigawatt of production capacity.
We signed an agreement with an international energy company for a 3.5 MW electrolyzer. Lastly, we were awarded for Enova funding. I will touch upon all of these highlights as we go through the presentation. Let's start with the financial highlights. As I said, we are happy with the revenue development that we've seen. It's in line with our expectations. We said last quarter that we would start to see revenues picking up in the second half of this year, and that is what we are seeing. We would also expect revenues next quarter to be relatively on the same level as this quarter. That means that we also see improvements on EBITDA, which is good, but still we do have the ramp-up cost related to expansions and non-recurring order cost. That we need to continue to expect going forward.
Keep in mind, we are building a company which is growing. We're expanding into new regions, and that means that we need to carry these costs, also going forward. In terms of cash, we have a very comfortable cash position, around about NOK 650 million, which means that we have a good financing capacity to undertake the plans that we have talked about. Nel in brief. For many of you, this is not news, but we keep repeating some of the same messages, largely because we are getting more and more shareholders. Now we have close to 24,000 shareholders, I believe. That's more than 7,000 additional shareholders in this year alone. What makes us unique is the fact that we have this integrated approach. We are able to deliver electrolyzers in all different sizes and shapes, and we are able to deliver fueling stations.
These are two, what should I say, legs that we stand on, which can operate in separate projects, but in some cases we do put them together. We would then be able to approach projects and win projects that other companies will not be able to win because we can combine these two. This is technology that we have developed in-house, so we have all of the competence in-house, and I think that's also something that makes us quite unique. We are increasingly a global company. We have, as you know, production facilities in Norway, in Denmark and the United States, and we also have organizations and people in other relevant places like California, Korea, China, Japan, et cetera. We are still the biggest electrolyzer company in the world. We have delivered more than 3,500 systems in more than 80 countries.
Fueling stations, we say that we are not the biggest, but we are one of the leaders. We are now working on station number 50 in country number 9. That's a short overview of where we are. This is the production facilities that we have in Wallingford, Connecticut, U.S.A. We have roughly 40 MW PEM capacity. In Notodden and Herøya in combination, we are building, we currently have 40 MW plus, we are expanding to 360 MW. I'll talk more about that later. We have our fueling station facility in Denmark, where we have the production capacity to produce 300 stations per year. Another element which is quite unique for Nel is that we have very long experience in each of these areas. In PEM we have 20-30 years experience.
In alkaline, we have more than 90 years experience, and in fueling stations, we have around about 15 years experience. That is quite unique. You don't find that in our competitors. Finally, I would like to point out one thing which is very important when you talk to customers and you are able to point to a lot of equipment sitting out in the field, that's also quite useful. We have happy customers in many places around the world. If a new customer comes and says, "I would like to look at the facility," we can always find an equipment standing and operating and delivering services for our customers around the globe. All of those elements makes us unique, and hopefully we are able to take that uniqueness and run with it faster than others can do.
Key developments of the quarter, we have to go through that and we have to, I think, start with Korea. Let's face it, Korea is going to be an important market for Nel. They have a very clear ambition, probably the clearest ambition that any country has expressed, 300 stations by 2022. It's quite aggressive. We have had a very good start in Korea. We've had a long ramp-up because you need to be there and you need to work with the standards and the players. In 2019 alone, we have received orders for 10 stations, and the last two station orders came in Q3, had a total value of roughly EUR 3 million, something that we are quite happy with. We also invested in the joint venture, HyNet.
HyNet is a joint venture not only with Nel, but also with many of the other leading players like Hyundai, KOGAS, and other leading industry players in the region. HyNet has the ambition to establish 100 stations, 100 out of the 300. That's the Korea part. We also announced the H2Bus consortium. H2Bus consortium is a consortium between all the relevant parties that needs to be there to get fuel cell buses to fly. We have Ballard on fuel cells. We have Hexagon on tanks. We have Wrightbus on buses. We have Nel on electrolyzers and fueling stations. We have both Ryse and Everfuel on being owner operators. That means that when Ruter, five, six years ago wanted to establish their bus depot and hydrogen buses, they had to get into all of the technical details. Where do I get the bus?
Where do I get the fueling station? How do I put it together? How do I operate it? Now, the bus operators can simply call H2Bus Europe consortium and say, "I would like to have X number of buses," and we will be able to set up the equipment in the bus depot, the fueling station, so that the operator can only buy fuel per kilo, like they do today, they buy diesel per liter. That's the benefit of this setup, we think, and we will also be able to cut costs quicker on buses. We have received the funding for deploying 600 buses around Europe, and that will be done by our partners, Ryse and Everfuel. As you remember, we also signed the agreement with Everfuel, where we have a minority interest, and which is going to be an owner operator of infrastructure for bus fueling.
We also have a sales and service agreement with Everfuel that we can supply equipment up to EUR 100 million. We are all working very hard to get this off the ground and start to work, and we hope to see some more news from that part going forward. We applied for DOE funding together with Nikola. DOE is Department of Energy in the U.S. We got awarded, or we got proposed, as it says, for a $2 million funding for developing the next generation fueling station for Nikola. Nikola wants to fuel faster and more, and there are technology elements that needs to be developed and which we are working on, and this will help us to basically undertake that development. That is encouraging. We are working together with Nikola to finalize the agreement. That's the way it works with DOE.
They propose you for funding, and then you need to finalize the agreements together with DOE. We are also in good dialogue when it comes to the rollout of additional stations with Nikola. We are working on the details of the spec, on the locations, and the rollout plan. We hope to come back to you in a relatively short time frame with more news related to the Nikola rollout. We signed an agreement with Yara. As you know, Yara is aggressively pursuing CO2-free ammonia, CO2-free fertilizer, probably one of the companies in this category that is basically pushing this the hardest. We are very proud and happy to be their partner on this venture. As you know, we have the common DNA, we have the common history. We were part of the same company in the past.
It's very nice to be back and working together on that. If we are also moving to Herøya, you know that we will be physically very close to each other, so that is also nice. In this particular project, we will implement the next generation alkaline. Even though we push cost and capacity aggressively on existing platforms, we also have to think about the next platform. This is basically exploring what could be the next platform, which we hope will be able to give us even lower cost and even more flexibility, et cetera. Purposely made for this application. There is a massive potential for green, for electrolyzers in the ammonia industry. They are currently today the biggest consumer of hydrogen, fossil hydrogen, everything. We need to exchange that out, and it's a very large market. This is an early start.
It's also good for us to be a part of these early developments, as I've talked about also before, because you understand what the customer wants. You need to work closely with these partners. Lastly, before the end of the quarter, we announced the agreement with a large international energy company for a 3.5 megawatt electrolyzer system. We have, for the time being, not been allowed to disclose the name, so we need to come back to that. The reason is that we are also working on other stuff. We need to pursue that before we go out with more details. On this picture, you see a picture of our new A1000 electrolyzer unit. This is going to be our standard building block going forward. This will be a lean mean hydrogen production machine that we will make out of Herøya.
This is a 5 MW unit, and you could build this into four of them, will make them a 20 MW unit, and you can also build it into a 100 MW unit. They are purposely designed to be able to more easily be assembled on site, more easy to transport. We think that this is going to be a very, or shall I say, robust building block for us when we expand our capacity at Herøya. Speaking of capacity expansion at Herøya, we want to provide you with a bit more information related to that topic. Initially, we thought we would expand to 360 MW. That's after all, 10 times more than we have, we thought that that would be enough for a while. We realized that we maybe have to think bigger. We have to think even longer term.
We see that the demand for electrolyzers is going to expand even beyond that, and we need more capacity. If you remember back, and this is maybe some details, initially, we said that the old line at Notodden and the new line at Notodden would together be able to deliver 360 megawatts. With the new design, one new line will deliver 360 megawatts. We have an improvement there. We said we want to find a location that can hold more, that have even better logistics. Here we are close to a port, close to partners, have a long tradition for industrial 24/7, 365 manufacturing. We want to have infrastructure in the area, in the building, which can support higher production volumes, et cetera. All of that we found at Herøya in combination with very nice, attractive terms for us to move into this location.
We now have a location that is able to cater for much bigger capacity. We can still start with 360 MW, which makes sense, and ramp that up in connection with customer demands, but then we can add additional lines and get up to at least 1 GW or more. Notodden will remain the R&D and engineering hub, simply because there is a lot of engineering and technical competency in the area. We have them already located there. There is a relatively short distance between Notodden and Herøya after all. That's the setup that we intend to run with. When it comes to the grant, we applied and received the grant from Enova to make an even more advanced production line. Here, we will come back with more information in the beginning of next year because this engineering piece of work is now continuing.
We will know more at the beginning of next year, but this will be implemented as part of the expansion. It's not something new. It will be implemented as part of the expansion, and it means that we will be able to get even more out of each line and we will save energy. It'll be more energy efficient. Costs will go down even further. That will allow us to take the 360 MW line and push even more material through the same line. You see a picture there of some of the elements. We're talking about fully automated with robot cells, a fully automated chemical line. We think that this is going to aggressively cut cost and make renewable hydrogen relevant. Our target is basically to out-compete the fossil, and that's what we are basically setting up this facility to do.
We will give you a lot of more details in the first quarter sometime next year, and hopefully also show you some 3D renders and stuff like that. We made a chapter called Industry Updates, where we basically gathered some of the news that we've seen, which may be interesting also for you throughout the quarter. Let me start with CNH moving into Nikola. We think this is a really great milestone. Obviously, Nikola is also making their business case more and more robust and de-risking it every day because they are extremely well at tying up with different partners that are leading within their field. CNH is going to invest $250 million into Nikola in the D round, which is great. CNH owns Iveco.
Iveco is a European truck manufacturer. That means that Nikola and Iveco together can also help each other to roll out the technology here in Europe, which is also great news. Basically commercializing, supporting Nikola to commercialize also here in Europe. That means that Nikola and Iveco are really putting the pressure on the older truck manufacturer like Volvo and like Daimler, which for the time being are very focused on maintaining their diesel. Additionally, we've got the news that both Bosch and Hanwha invested in the previous round, $230 million altogether, which I think also is a great example. Bosch, if you open up the hood of a car, you see Bosch on every second part. They are extremely into all the nitty-gritty supply elements of the automotive industry. Hanwha is obviously one of the leading solar companies in the world.
This is just another example of great partners that they are adding to the list. Other interesting developments, we have said before that heavy duty is moving faster than we expected, and we saw some elements of that also last quarter, last month. Not too long ago, we got the announcement for Renault. Renault is implementing light trucks, sorry, vans, medium-size and heavy and large vans, for running on hydrogen, which I think is great. Toyota is moving into Europe with their bus concept. They're tying up with a Portuguese bus manufacturer. We saw also a new truck model from Hyundai. Hyundai is actually starting now to deliver hydrogen trucks into Switzerland and are going to deliver a substantial number of trucks into Switzerland next year.
Then we saw an entirely new segment, which not many of you probably have thought about before, illustrated with the joint venture or the joint initiatives between ENGIE and Anglo American. Anglo American is a huge company that does mining, and they are going to translate their diesel-electric dump trucks, huge trucks that are diesel electric, they will rip out the diesel engine and stick in the fuel cell instead and make it hydrogen electric and be able to then run it on renewables instead of on fossils. Very large consumers of hydrogen, and I think you'll see more news related to this also, these activities going forward. I think it's interesting to note that this is another example of an area where hydrogen is very relevant compared to batteries, because these obviously need to run 24/7, and they use a lot of energy.
Although we see a lot of developments on heavy duty, we also see developments on light duty. If you think about the number of cars at the end of 2018, it was around about 11,000 fuel cell cars. It's a substantial number, even though it's low. You have to add the almost 30,000 fuel cell trucks, sorry, forklifts, fuel cell electric forklifts, which is today running 24/7. This is still estimated to expand significantly. The estimate is that by 2030, there will be 2.5 million fuel cell vehicles on the road. That is 223 times where we are today. It's a huge expansion. Why is this important? Well, all of these vehicles need stations, and obviously, we are in the station business. Hopefully, we will be able to participate on that journey.
The estimates today is that the number of stations needs to grow from below 400 to more than 4,000 in this same period. We saw some great announcements also from car OEMs, car manufacturers. We saw the BMW Next, which is built on the X5 platform, which we think makes a lot of sense because it's a heavy car and it's supposed to move far, and then it makes perfect sense to use hydrogen to electrify. The i3 will obviously not be hydrogen. That can perfectly well be a battery electric. I'll get back to why we see these trends, but it has to do with range. When you want to move far, suddenly it becomes cheaper and you achieve things easier using hydrogen if you want to electrify. We also saw the new Mirai, which is going to be commercially launched already next year.
Here, Toyota is moving fast. They're making it cheaper, they're making it more efficient, and they're obviously making it much more attractive to look at. It's a nice car, really, this new Mirai, which is coming to the market. In Norway, we very often get the question related to fuel cell and battery, I kind of wanted to give you a new perspective because the car OEMs are still aggressively working on fuel cell cars, and why are they doing that? When you listen in Norway, we think that the battle is already won by battery electric. You think that they will take over all the markets. Why are the car OEMs still pushing it? This is the reason, and the trap that many fall into is to compare watermelons with bananas.
You cannot compare a very small production scale volume of fuel cell vehicles with the battery electric, which is ahead in terms of number of years. If you compare the long-term targets, which we have done here, we take DOE, the Department of Energy in the U.S., we take their numbers, you take the long-term targets for battery electric, how far down can the cost go? You take the long-term target for fuel cell electric, how far down can the cost go? You start to see some interesting numbers, especially when it comes to range. We put that into this calculation for you. Here you see, in the middle of the screen, let's focus on 1,000 kilometers. You can look at the details in your own time, let's focus on 1,000 kilometers. If you want to have 1,000-kilometer range, what is more cost effective?
Is it going with battery or is it going with hydrogen? I'm not talking about physically being able to put all the batteries in the car, which may not even be possible. I'm just talking about cost. Here you will see that hydrogen electric, when you talk about range, is going to be much more cost effective. At the end of the day, the car frame, the wheels are going to cost the same. It's the fuel cell system and the battery system which is going to be the distinguishing factor, and the hydrogen electric system is going to be much more cost effective when you talk about long range, illustrated with these numbers here. That's something to keep in mind when you get into a good discussion at some point in time related to hydrogen electric versus battery electric.
IRENA, International Renewable Energy Agency, came out with a report in September, I think it's quite interesting reading. It summarizes a lot of the developments that we have seen here. It summarizes some of the things that we have also covered. It re-emphasizes the fact that if you're going to decarbonize some of these industries that we are talking about, hydrogen is the only solution you have. I'm talking now about green renewable hydrogen. In 2050, they estimate that 16% of all electricity produced will be consumed by electrolyzers to produce green renewable hydrogen, to be able to decarbonize ammonia, decarbonize steel, decarbonize a lot of other industries. That means that we will need to expand and build a lot of solar and a lot of wind in the years to come.
We actually need to build probably 10 times the amount that has been installed today, to date, by 2050. You will also see that political community and the energy analysts are increasingly agreeing with the report here, that hydrogen is going to be a key component to be able to decarbonize and do the energy transition. We, Nel, we call it green hydrogen, unlocking the potential of renewable. That's basically what we are trying to do. That was the main part of the presentation. Let me quickly move through the summary and outlook. In terms of summary, we still are focusing or we introduced a new element, which is going to be our guiding star going forward, is world-class safety. We should not see any incidents on sites that has Nel equipment, and that is going to be critically important for us.
We want to maintain the target of being a cost leader. We have to be able to out-compete fossil, and we have to be able to continue to drive costs down, to not only towards competition, but obviously to be able to open up new markets. We want to be a technology front-runner. What does that mean? Well, it means not only OpEx and CapEx are important, but also being able to launch new products on a regular basis to drive demand. We also want to be the preferred partner. We want to be open and honest with our customers and find solutions and packages and put things together that is attractive for our customers. We want to make sure that we have a strong financing so that we can actually execute on our plans.
We also are building a global presence, not everywhere, not every market is moving, but in all the relevant markets, we want to have a presence. That's the key focus areas for us that we can continue to push. In terms of the outlook, you will recognize many of these points before. I have to remind again, that as we push this company to grow, we will have to carry some cost, which will negatively affect EBITDA. We could stop and turn this profitable very quickly, but then we wouldn't be the leader in a few years. We have to keep going, and we have to keep pushing to develop this company to continue to maintain our leadership. That means that we need to keep also accepting that we will carry some cost that will affect the EBITDA in the shorter term.
We want to continue to develop the state-of-the-art safety solutions. Obviously, we want to continue to build on the expansion to that area, and we'll come back with more information on that. Heavy duty is going to be one of the key areas still. We need to adapt our technology and our production to that. We cannot forget next generation electrolyzers. It's going to be also important for these new markets. We still see a lot of activity for tenders. That's probably where we spend the most amount of resources at the moment.
Being able to sift through requests for projects, find out who has funding, who is too far out in time, and try to find out where do we spend our time, so that we are able to participate in many of these interesting projects. Hopefully we'll see more news as we move forward related to many of these activities. With that, I think we have finished the formal part of the presentation, and we would be able to open up for some questions. We have a microphone here, so if there is someone in the room that has a question, either for me or for Bjørn or for Bent, you should wait for the microphone. Otherwise, we also have some questions, I guess, from the web. Should we? Yeah, there is one over there.
Hello? Okay, my name is Kai Engebretsen. I'm CEO of Maritime Innovation. We are naval architects designing boats. I see that you have a lot of information about the car industry, but what's going on in the maritime sector? Can you talk about that a little bit?
Yes, we could do. We also have our gentleman here, Thomas, who is heading up Hyon, which is basically our joint venture that we have together with Hexagon, PowerCell and Nel. Hyon is supposed to be the one-stop shop that basically works towards marine applications. Thomas, please, feel free.
Thank you. I could expand just very shortly on that. There are actually quite a lot going on there. We are speaking about short sea shipping, of course, in the first term. That's ships that go in fixed routes from one place to another. Typically, ferries, high-speed ferries, or short sea transportation, typically between North Europe and the continent. This will be the first movers because of the easy way of set up the infrastructure by way of all the Nel plants and the smaller volumes of power and storage in the beginning.
Please connect with Thomas Tollefsen, who is heading up the Hyon, so he can give you more. They are working on how many projects? 10, 15 projects at the moment. Some of them are PILOT-E. They are working on two PILOT-E projects. There is a lot of initiatives, and here I think it is a very good example of where Norway really can be the front runner. We can build really a distinguishing competitive position compared to the other ship builders around the world and the ship designers. I think you are touching on some very interesting. This is really an area where we can run away from the rest of the world if we address this in a smart way.
We make fast ferries, traditional ferries, boats running on renewable hydrogen, and we can offer this to the world before anyone else is able to do it. Any other questions from the room, or should we move to the web? Bjørn, then you need to run to the
I only have to look at it. There is never a total presentation without a question on the RotoLyzer . What is the latest and greatest on the RotoLyzer ?
The latest and greatest on the RotoLyzer is that, if you remember back, last year, we did long-term testing on the RotoLyzer . We need to make the technology robust. What we've done this year is that we have made some changes to the stack, to the way that it's basically set up in the structure to make it more robust. We are now starting testing again to see whether that is verified. I love the RotoLyzer . I think it's a very exciting product. There are some fundamental elements to it, but don't be blinded by only looking at this technology because you see the projects are getting bigger and bigger. Yes, it could address a niche market, certainly. It could be very interesting in many of those applications.
When it comes to the really big stuff, you don't want something very large rotating, you want it to sit still. You're not so concerned about space because it's a big industrial site. There, I think some of the things that we are doing at Herøya, where we're cutting costs by close to half, et cetera, those are really the key drivers. A brief update on the RotoLyzer . Any questions from the room, or should we take another one from We have time for a few more, Bjørn?
Yeah. There's one here from Beric Schwarzhaupt. What are the developments in China and Japan?
China and Japan. We have people on the ground in both areas. Let's start with Japan. Japan, we have sold alkaline electrolyzers to Japan, and we continue to push that. Our current platform for fuel cell hydrogen stations are not certified for Japan, except the one that has been licensed by Mitsubishi. We have a licensing agreement with Mitsubishi Heavy Industries. We are not going to change our product, the main portfolio products, to adapt to the Japanese regulations because we think that they are not very cost-effective. They have regulations that makes fueling stations three times more expensive than they are in Europe and in the U.S. because they have special alloys, they need to have special distances, et cetera. That, we will wait and see how regulations turn out.
The same goes for China when it comes to the fueling stations. Keep in mind, China is primarily focusing on heavy duty. Buses, trucks, lorries, vans, that's their key area. When it comes to electrolyzers, we already sold a lot of electrolyzers to China, through our agent and through our local office over there, and we keep pushing that. Whether we move in more aggressively, we still haven't decided on the strategy. That is to be something that we're working on. It needs to be done in the right way with the right partners, to be able to protect IP and all of those questions. Any more questions in the room?
Thank you. Good morning. I'm Claes Fredriksson, with a company called Liquid Wind.
I think it's working. It's more for the external audience.
Okay. I'm just curious about the Nikola trucks. When do we see them on the road? How far away is that to happening?
You should probably ask Nikola that question. You already see them in the U.S. They launched two prototype trucks, which look nice. They look like they're finished products. They're driving them around, on the streets, on the test track, to different shows, et cetera. I don't think I'm the one that should answer the details on their ramp-up rollout plans. They have made certain statements, I'm sure that you'll be able to find that. Okay. It seems like everyone is happy, and that there are no more questions, I would like to just thank you for your participation and for the fact that you're here, and we hope to welcome you back again, for the fourth-quarter presentation. Thank you very much.