ITM Power’s Sheffield Gigafactory Clears Final Regulatory Hurdle as State Aid Approval Unlocks £86.5M Package

The British state’s commitment to building a domestic hydrogen supply chain hardened further in July when ITM Power secured the last outstanding regulatory clearance for a £46.5 million grant aimed at producing its next-generation electrolyser stacks. The green light from the State Aid Unit (SAU) on 12 July allows the Department for Energy Security and Net Zero to formalise the contract for the Chronos production line, a project that has already drawn a parallel £40 million equity injection from Great British Energy. Together, the two injections give the Sheffield-based manufacturer just shy of £87 million in public backing — one of the largest single rounds of government support in the company’s history.

The new manufacturing line, to be housed at ITM Power’s existing Sheffield facility, is designed to churn out 1 GW of electrolyser stacks annually. Company executives describe Chronos as a step-change in efficiency that should drive down unit costs and widen the addressable market for green hydrogen. The investment covers the full production sequence: catalyst-coated membranes, electrode welding, bespoke coating processes and final stack assembly, plus the construction of the clean rooms required for each stage. Chief executive Dennis Schulz called the funding a decisive moment, positioning ITM Power at the centre of Britain’s emerging hydrogen economy.

The grant was first flagged in April, and the formal notification arrived on 9 July, but the SAU’s sign-off was the final piece of the regulatory puzzle. With that box ticked, the contractual process with DESNZ can now proceed to binding signature. For a company that has repeatedly tapped external finance in the past, the certainty of a multi-million-pound state subsidy adds a layer of financial stability that should ease near-term cash concerns.

Yet on the London Stock Exchange the news has done little to arrest recent selling pressure. ITM Power’s shares recently changed hands at €1.33, down 1.85% on the day and retreating 9.89% over the past week. The 30-day slide stands at 10.26%, and the stock now sits 22.21% below its 50-day moving average of €1.71. The Relative Strength Index of 40.9 suggests neutral-to-weak momentum, while the annualised volatility reading of over 106% underscores the chronic price swings that have become a hallmark of the name.

Should investors sell immediately? Or is it worth buying ITM Power?

Zooming out, the picture brightens considerably. From a February 2026 low of €0.65 the stock has more than doubled, and the year-to-date gain still stands at 83.32%, with a 12-month advance of 46.80%. The market capitalisation currently hovers around €933 million. Still, the gap to the 52-week high of €2.58, set on 29 May, remains a yawning 48.41% — a visual reminder of how far the optimism of late spring has been pared back.

The macro environment, meanwhile, has been tilting decisively in hydrogen’s favour. The UK government has scrapped the 18-pound-per-tonne Carbon Price Support, while the domestic emissions trading system held steady at £53.15 per tonne in the first quarter. Gas is now setting the power price only 60% of the time, down from 90% before, and gas demand has dropped by a fifth over three years. The latest Allocation Round 7 secured 14.6 GW of new low-carbon capacity, adding further impetus to the clean energy pipeline.

Industry forecasts project the global installed electrolyser base racing from today’s level to 150-200 GW by 2030 and beyond 500 GW by 2035, implying a compound annual growth rate of more than 30%. PEM electrolysis — the technology ITM Power uses — is expected to capture 40-45% of that market by the decade’s end. Whether those multi-year trends will translate into a more stable share price for ITM Power depends in part on how swiftly the DESNZ contract moves from clearance to signature. For now, the market appears to be demanding proof of execution before awarding any further premium to the Chronos story.