Hydrogen Generation Market Growth Will Reach at 5.42% Through 2030

Published Date : 18 May 2023

The global hydrogen generation market revenue is expected to touch around USD 219.8 billion by 2030 and poised to grow at a CAGR of 5.42% from 2022 to 2030.

The global market for hydrogen generation is expanding as a result of the increasing need for green energy across numerous industries.

Market Overview:

Clean and green energy have been developed and adopted as a result of the growing concerns about global warming and the deteriorating climatic and environmental circumstances brought on by excess pollution. Because of this, hydrogen is a source of clean and renewable energy and is projected to grow significantly throughout the forecast period. The production and consumption of hydrogen are being encouraged by growing government measures to minimize carbon footprints, which is driving up the hydrogen generation industry globally. Since 1975, there has been a threefold increase in the demand for hydrogen. The global market for hydrogen generation is expanding as green energy is becoming more and more in demand across numerous industries. 

As of 2019, there were over 70 million tons of dedicated hydrogen production annually, which is more than Germany's principal energy source.

The manufacturing of fertilizer and oil refining are the main applications as of 2019. Approximately half of it is used in the Haber process to generate ammonia (NH3), which is subsequently utilized as fertilizer, either directly or indirectly. The demand for ammonia is rising along with the world population and the intensive agriculture that feeds it. Hydrogen may be safely and more conveniently stored in ammonia. In the browser, membrane technology can convert the delivered ammonia back to hydrogen.

Regional Analysis:

The government has paid more attention to hydrogen in recent years. 2020 saw the introduction of Canada's and the US's non-binding hydrogen economy development plans. While California has implemented advantageous hydrogen regulations as part of its Low Carbon Fuel Standard, the majority of Canadian provinces have also published their own plans. Deals done in the hydrogen sector so far in 2021 are worth 60% more than they were from 2016 through 2020 put together.

8,000 FCEVs (Fuel Cell Vehicles), or around one-third of the world total, are now on the road in the US as of 2019. They are largely concentrated in California. By 2026, the California Air Resources Board (CARB) projects that about 50,000 FCEVs will have been installed in the state. In the foreseeable future, they are anticipated to continue to have a lesser market share than BEVs.

The market for hydrogen generation in China was valued at USD 30.56 billion in 2022 and is anticipated to increase to USD 60.32 billion by 2032, increasing at a CAGR of 8.54% between 2023 and 2032.

The market for hydrogen generation in Japan was valued at USD 15.26 billion in 2022 and is anticipated to increase to USD 27.30 billion by 2032, increasing at a CAGR of 7.65% between 2023 and 2032.

The market for hydrogen generation in India was valued at USD 6.4 billion in 2022 and is anticipated to increase to USD 12.6 billion by 2032, with a CAGR of 8.12% from 2023 to 2032.

Hydrogen Generation Market Report Scope:

Report Coverage Details
Market Revenue in 2023 USD 148 Billion
Projected Forecast Revenue in 2030 USD 219.8 Billion
Growth Rate from 2022 to 2030 CAGR of 5.42%
Largest Market Asia Pacific
Base Year 2022
Forecast Period 2022 to 2030
Regions Covered North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa

Competitive Landscape

After examining the huge expansion of hydrogen in power production and transportation, a considerable number of players also believe in partnering with electric car manufacturers or with power distribution businesses to safeguard their future growth possibilities. Vehicles using hydrogen fuel cells are a newer technology that has gained popularity in both developing and industrialized nations, including China, Japan, Germany, the United States, the United Kingdom, and many more. As a result, the market for hydrogen generation is extremely competitive and fragmented, providing much potential for industry participants to experience future growth.

Here are some of the major market payers for the Hydrogen Generation Market

  • Linde plc
  • Air Liquide International S.A.
  • Hydrogenics
  • Inox
  • Messer Group GmbH
  • Air Products and Chemicals, Inc.
  • Weldstar, Inc.
  • Praxair, Inc.
  • McPhy
  • LNI Swissgas

Market Dynamics:

Market Drivers: Increasing investment and expansion of industrial sector

Hydrogen supply to industrial customers has grown into a significant global industry. With 6% of the world's natural gas supply and 2% of the world's coal going toward hydrogen generation, the demand for hydrogen, which has increased more than thrice since 1975, is nearly exclusively met by fossil fuels. Together with the expansion of the industries they target, more nations are enacting policies that actively encourage investment in hydrogen technology.  Now, there are about 50 objectives, regulations, and incentives in place that directly assist hydrogen, with the bulk concentrating on transportation.

National governments have increased their global investment on hydrogen energy research, development, and demonstration during the previous several years, albeit it hasn't reached its 2008 peak.

Market Restraints: The price of hydrogen energy is high, and there are storage issues

The two primary methods for extracting hydrogen, electrolysis and steam reforming, are quite costly. This is the actual cause of why it isn't widely utilized anywhere. Currently, the majority of hybrid cars are powered mostly by hydrogen energy.

The reduced density of hydrogen is one of its characteristics. In actuality, it has a far lower density than gasoline. To ensure its usefulness and efficiency as an energy source, it must be compressed into a liquid form and stored in the same way at lower temperatures.

This explains why it is impossible to carry and use hydrogen in everyday life, and why it must always be kept and carried at high pressure.

Market Opportunities: Building on current industries, infrastructure, and policy

Although hydrogen is now widely employed in several industries, it has not yet reached the full extent of its potential to enable the transition to clean energy. Action that is ambitious, focused, and taken soon will help remove more obstacles and cut expenses.

Building on current industries, infrastructure, and policy, four value chains provide launching pads for expanding hydrogen supply and consumption. Governments and other stakeholders will be able to choose which of these in their own geographic, industrial, and energy system settings provide the most immediate promise.

The complete policy package comprising the five action areas mentioned above will be required, regardless of which of these four main opportunities or any value chains not specified here are followed. Moreover, governments at regional, national, and local levels will gain from international collaboration with other parties that are attempting to advance comparable hydrogen markets.

Technology Insights:

The global market has been further segmented based on Technology Type into Steam Methane Reforming, Coal Gasification, and Others. Operational advantages including the steam methane reforming process' high conversion efficiency are further elements boosting the market's expansion. In 2022, Coal Gasification accounted for 46.23% of the global Hydrogen Generating Market. Since coal is used as the primary raw material in coal gasification, which has been in use for almost 200 years, it is considered a mature technique for creating hydrogen.

Application Insights:

The market's leading category, ammonia production, held the greatest revenue share of more than 25.36% in 2022. Throughout the forecast period, the ammonia production segment will continue to be in the lead. Ammonia's potential as a carbon-free fuel, hydrogen carrier, and energy reservoir gives a chance for the expansion of the use of renewable hydrogen technology. With ammonia facilities, hydrogen is often produced on-site from a feedstock of fossil fuels.

Technology for hydrogen-based power generation has successfully established itself in developed markets like North America and Europe, where clean yet efficient energy is one of the key components. Demands for hydrogen-based power generation, a reliable and affordable form of power generation, are rising.

Source Insights:

Natural gas was the dominant source in the market in 2022. When natural gas is converted, hydrogen, carbon monoxide, and carbon dioxide are created. The least expensive way to produce hydrogen is from natural gas. During the predicted period, it is anticipated to maintain its lead.

System Insights:

According to systems, the market's Merchant generating segment was dominant in 2022. Modern advances in fuel cell technology have been seen, with a move towards green hydrogen as well as one of the fastest expanding segments in commercial hydrogen application areas.

The most recent data on industrial gas applications for hydrogen, market prospects for commercial hydrogen, and potential roles for the developing hydrogen energy industry.

Recent Development:

  • In March 2021, a collaboration deal was made to build a hydrogen plant in the US between Plug Power, Inc. and Brookfield Renewable Partners. In order to lower its carbon impact, this factory plans to produce about 15 metric tons of liquid hydrogen every day.

Market Segmentation:

By Technology

  • Coal Gasification
  • Steam Methane Reforming
  • Partial Oxidation (POX)
  • Electrolysis
  • Others

By Application

  • Methanol Production
  • Ammonia Production
  • Petroleum Refinery
  • Transportation
  • Power Generation
  • Others

By Type

  • Blue Hydrogen
  • Gray Hydrogen
  • Green Hydrogen

By System Type

  • Merchant
  • Captive

By Source

  • Natural Gas
  • Coal
  • Biomass
  • Water

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