Description
Global Hydrogen Market: Key Takeaways
- North America dominated in 2023, and is expected to grow at the highest CAGR in the global hydrogen market, during forecast period.
- By sector, the generation segment dominated in 2023, and is expected to grow at the highest CAGR in the global hydrogen market, during forecast period.
- By application, the mobility segment dominated in 2023, and is expected to grow at the highest CAGR in the global hydrogen market, during forecast period.
Global Hydrogen Market: Overview
The global hydrogen market refers to the production, delivery, storage, and use of hydrogen mainly as a clean energy source are all included in the hydrogen market. Hydrogen is becoming more and more recognized as a crucial substitute for fossil fuels as countries and businesses work toward decarbonization. Because of its adaptability, it can be utilized in a variety of fields, including industrial, energy storage, and transportation. The market for hydrogen is anticipated to expand quickly as infrastructure and technology develop, with an emphasis on green hydrogen production to aid in decarbonization in industries that are challenging to electrify.
Global Hydrogen Market: Dynamics
Drivers:
- Demand from industry and difficult sectors to decarbonize
In energy-intensive sectors like steel, cement, and chemical manufacture, where high heat and hydrogen feedstock are necessary, hydrogen presents a competitive alternative to fossil fuels. Long-haul trucks, buses, trains, and ships are among the heavy-duty vehicles where hydrogen is a promising option for decarbonizing transportation. In these vehicles, battery-electric technology may not be as feasible because of weight or range constraints.
- Improvements in technology and cost savings
By increasing the efficiency and lowering the energy requirements of the water-splitting process, advancements in electrolyzer technology are lowering the cost of producing green hydrogen. Because of economies of scale and technology improvements, costs should decrease as more hydrogen projects are implemented, making hydrogen more competitive with conventional fuels.
Restraint:
- Losses in energy efficiency
Direct use of power is more efficient than converting it to hydrogen and back to electricity (as in fuel cells, for instance). Because of this energy loss, hydrogen is less appropriate for uses like passenger cars and home heating where direct electrification is feasible. Direct electrification and battery storage are frequently more economical and efficient than hydrogen for specific uses, such as energy storage or light-duty transportation.
Global Hydrogen Market: Opportunity
Combining renewable energy with grid balancing
Grid stability and the dependability of renewable energy sources can be increased by using hydrogen to store excess energy from renewable sources (such as solar and wind) during off-peak hours and release it during peak demand. Because hydrogen provides a means of storing energy for days, weeks, or even months, it makes it possible to integrate intermittent renewable energy sources more effectively into power networks.
Improvements in technology and cost savings
By increasing the efficiency and lowering the energy requirements of the water-splitting process, advancements in electrolyzer technology are lowering the cost of producing green hydrogen. Because of economies of scale and technology improvements, costs should decrease as more hydrogen projects are implemented, making hydrogen more competitive with conventional fuels.
Global Hydrogen Market: Segment Covered in the Report
By Sector
Generation Type
- Grey hydrogen
- Blue hydrogen
- Green hydrogen
Storage
- Physical
- Material-based
Transportation
- Long Distance
- Short Distance
By Application
Energy
- Power generation
- CHP
Mobility
Chemical & refinery
- Petroleum refinery
- Ammonia refinery
- Methanol refinery
Global Hydrogen Market: Segment Insight
By Sector
The generation segment dominated in 2023, and is expected to grow at the highest CAGR in the global hydrogen market, during forecast period, by sector. Hydrogen is essential for decarbonizing hard-to-electrify industries including heavy manufacturing, shipping, and aviation in light of the strong worldwide targets to cut carbon emissions. To address this growing demand, clean hydrogen generation—in particular, green and blue hydrogen—is growing. Clean hydrogen is especially appealing to industries like steel, chemicals, and refineries because it allows them to substitute carbon-intensive inputs without requiring significant adjustments to process technologies. Governments all across the world have made green hydrogen production more economically feasible by introducing grants, tax breaks, and subsidies. Investment in hydrogen generation infrastructure is encouraged by initiatives such as the U.S. Inflation Reduction Act, the EU’s Green Deal, and Japan’s hydrogen policies.
By Application
The mobility segment dominated in 2023, and is expected to grow at the highest CAGR in the global hydrogen market, during forecast period, by application. One major source of carbon emissions worldwide is the transportation industry. Hydrogen fuel cells offer an efficient zero-emission substitute, particularly in situations where battery-electric vehicles (BEVs) are less appropriate. Many nations and businesses are working to reduce emissions from all kinds of cars. For heavy-duty applications like trucks, buses, trains, ships, and possibly even airplanes, hydrogen fuel cell technology is very beneficial. Hydrogen is the recommended option for these applications since they frequently need for greater range and quicker refueling than batteries can offer. Fuel cell technological advancements have made hydrogen-powered vehicles more economical, efficient, and small, making them a competitive option to BEVs in some applications. The cost of fuel cells is steadily declining due to mass production and technological advancements, increasing the viability of hydrogen-based transportation for commercial applications.
By Region
North America dominated in 2023, and is expected to grow at the highest CAGR in the global hydrogen market, during forecast period, by region. The federal government of the United States has made large expenditures in hydrogen infrastructure and research and development, especially for green and blue hydrogen production, through programs like the Infrastructure Investment and Jobs Act. Significant tax breaks for the production of clean hydrogen are also offered by the Inflation Reduction Act (IRA) of 2022. To promote the production, delivery, and use of hydrogen, the U.S. Department of Energy (DOE) is leading the creation of a number of “hydrogen hubs” throughout the nation. These hubs establish local ecosystems that combine the production and end-use of hydrogen in many industries. Big businesses like Plug Power, ExxonMobil, Air Products, and Chevron are investing heavily in hydrogen infrastructure and technology, especially in blue and green hydrogen initiatives.
Global Hydrogen Market: Key Market Players
- BASF SE
- Air Liquide
- Air Products and Chemicals, Inc.
- Linde Plc
- Messer SE & Co. KGaA
- Bhuruka Gases Limited
- Thai Special Gas Company Limited
- Taiyo Nippon Sanso Corporation
- Yueyang Kaimeite Electronic Specialty Rare Gases Co., Ltd.
- Coregas
- The Wengfu Group
Global Hydrogen Market: Recent Developments
- In November 2024, the government introduces a pilot program worth Rs 200 crore to increase the use of green hydrogen in the commercial and residential sectors. To promote green hydrogen production and use in decentralized applications such as cooking, heating, and off-grid power, the MNRE has started a Rs 200 crore pilot program with the goal of evaluating its viability and safety in residential and communal settings.