Nickel green hydrogen demand is emerging as a significant industrial end-use for the metal, as alkaline electrolyser capacity scales globally and project developers lock in long-term supply agreements for nickel-intensive components.
Why Electrolysers Require Nickel
Alkaline electrolysers — the dominant commercial technology for large-scale green hydrogen production — use nickel-coated electrodes and nickel-based alloy components in their cell stacks. Electrode coatings typically require 0.3–0.5 kg of nickel per kilowatt of installed capacity, according to industry estimates, meaning a 100 MW project draws 30–50 tonnes of nickel before auxiliary systems are accounted for.
Proton exchange membrane (PEM) electrolysers, a competing technology gaining ground in Europe and North America, use iridium and platinum as catalysts and are not significant nickel consumers. The technology split matters for demand modelling: projects backing alkaline over PEM will drive more nickel offtake, while PEM scale-up shifts demand toward platinum group metals.
Nickel Green Hydrogen: Scale of Demand by 2030
The IEA’s Net Zero by 2050 scenario requires approximately 850 GW of electrolyser capacity by 2030 — a target that, if met predominantly through alkaline technology, would imply several hundred thousand tonnes of cumulative nickel demand from electrolysers alone. Current global electrolyser installations stand below 10 GW, making this a long-dated demand signal rather than a near-term price catalyst.
Analysts at Wood Mackenzie and Rystad Energy have flagged electrolyser nickel as an incremental demand stream that will remain below battery and stainless steel applications in volume terms through the late 2020s. However, the grade specification is relevant: electrolyser manufacturers prefer Class 1 refined nickel — the same specification demanded by battery precursor producers — rather than the nickel pig iron that has flooded the market from Indonesian smelters since 2022.
Class 1 Nickel and the Grade Premium
Class 1 nickel — refined to 99.8% purity and deliverable against the London Metal Exchange nickel contract — trades at a premium to the Class 2 products that dominate Indonesian output. That premium has compressed significantly since 2022 as Indonesian nickel pig iron supply overwhelmed the market, pushing the LME nickel price from above $30,000/tonne in 2022 to below $16,000/tonne through much of 2025.
Electrolyser procurement teams sourcing nickel for large industrial projects are buying into this compressed spread. If alkaline electrolyser demand scales as projected, Class 1 nickel producers — including Norilsk Nickel, Vale Base Metals, and BHP Nickel West — stand to benefit from tightening supply of the specific grade required. For current LME spot pricing, see the CMN nickel price tracker.
Green Ammonia: The Downstream Connection
Green hydrogen produced via alkaline electrolysis is not only consumed directly — it is the feedstock for green ammonia production via the Haber-Bosch process. Industrial producers are scaling green ammonia projects explicitly to decarbonise fertiliser supply chains and provide a storable hydrogen carrier for export markets.
Spain’s Fertiberia, one of Europe’s largest ammonia producers, is among the companies developing large-scale green ammonia capacity backed by alkaline electrolysers. Fertiberia’s green hydrogen and ammonia operations represent a direct downstream demand signal for the nickel-intensive electrolyser supply chain. Projects of this scale — Fertiberia has announced capacity targets requiring hundreds of megawatts of electrolyser deployment — translate into multi-tonne nickel procurement programmes once construction phases begin.
Supply Chain Risks
The nickel green hydrogen supply chain faces two structural vulnerabilities. First, the concentration of Class 1 refining capacity: outside Indonesia (which produces Class 2 product), primary refined nickel is dominated by Russia (Norilsk), Canada (Vale, Glencore), and Australia (BHP). Western sanctions risk and geopolitical exposure are material factors for electrolyser procurement teams building decade-long project timelines.
Second, the ramp in Indonesian Class 2 production has depressed price signals that would otherwise incentivise new Class 1 capacity. If the Class 1 premium remains suppressed, investment in new refining capacity serving battery and electrolyser end-users will lag. Industry bodies including the Nickel Institute have raised the long-term supply adequacy question for high-purity product as electrolyser and battery demand converge on the same grade specification.
For investors and procurement professionals tracking the nickel green hydrogen interface, the key variables are technology mix (alkaline vs PEM adoption rates), Class 1 supply investment cycles, and whether large industrial projects — green ammonia among them — commit at scale within this decade.
How much nickel does an alkaline electrolyser use?
Alkaline electrolysers typically require 0.3–0.5 kg of nickel per kilowatt of installed capacity for electrode coatings and alloy components. A 100 MW project can require 30–50 tonnes of nickel before auxiliary systems are included.
Does green hydrogen production drive nickel demand?
Yes, but the technology matters. Alkaline electrolysers — the dominant commercial scale technology — are significant nickel consumers. PEM electrolysers use platinum group metals instead. The technology split determines whether green hydrogen scale-up benefits nickel or PGM producers.
What grade of nickel do electrolysers require?
Electrolyser manufacturers specify Class 1 nickel, refined to 99.8% purity and deliverable against the LME contract. This is the same specification required by battery precursor producers, and distinct from the Class 2 nickel pig iron that dominates Indonesian output.
Which companies produce the nickel used in electrolysers?
Key Class 1 nickel producers include Norilsk Nickel (Russia), Vale Base Metals (Canada/Brazil), BHP Nickel West (Australia), and Glencore (multiple jurisdictions). Indonesian producers primarily supply Class 2 product, which is not suitable for electrolyser electrode applications.
What is green ammonia and how does it connect to nickel?
Green ammonia is produced by combining green hydrogen — made via electrolysis — with nitrogen through the Haber-Bosch process. Industrial producers scaling green ammonia projects are procuring alkaline electrolysers at scale, creating downstream demand for nickel-intensive components across multi-year construction programmes.
