PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1494740
PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1494740
According to Stratistics MRC, the Global Hydrogen Generation Market is accounted for $196.07 billion in 2024 and is expected to reach $416.95 billion by 2030 growing at a CAGR of 13.4% during the forecast period. It refers to the process of producing hydrogen gas through various methods, typically for use as a clean energy source or industrial feedstock. Another approach involves steam reforming of natural gas or biomass, which produces hydrogen along with carbon dioxide as a byproduct. Additionally, solar or wind-powered electrolysis is gaining traction as a renewable method of hydrogen production, offering a sustainable alternative to fossil fuel-based techniques.
According to IEA, in January 2022, there were at least 50 blue hydrogen projects in the works around the world, with capacity expected to grow more than tenfold by 2030. According to the Energy Institute Statistical Review of World Energy, the oil refining capacity witnessed a growth rate of 0.5% between 2021 and 2022, whereas the annual growth rate in the last decade was 0.7%.
Increasing demand for clean energy
The growing demand for clean energy solutions has propelled the hydrogen generation market into a prominent position. Hydrogen, renowned for its versatility and zero-emission properties, is increasingly favored as a key component in the transition towards sustainable energy systems. As industries and governments worldwide commit to reducing carbon footprints, hydrogen emerges as a vital player in decarbonizing sectors such as transportation, industry, and power generation.
High initial investment
Building facilities for electrolysis or steam methane reforming, as well as ensuring safe storage and transportation of hydrogen, demands substantial capital outlay. This financial burden often dissuades potential investors and stakeholders from entering the market or expanding existing operations. The uncertainty surrounding returns on investment and regulatory frameworks further complicates financing arrangements. Consequently, many regions face delays or limitations in scaling up hydrogen production capacity, hindering the market's potential to become a prominent player in the transition towards cleaner energy solutions.
Advancements in electrolysis technologies
Advancements in electrolysis technologies are revolutionizing the hydrogen generation market by offering more efficient, cost-effective, and sustainable methods for producing hydrogen. Traditional electrolysis involves splitting water molecules into hydrogen and oxygen using electricity. Recent innovations such as proton exchange membrane (PEM) electrolysis and solid oxide electrolysis cells (SOEC) have significantly improved the efficiency and scalability of hydrogen production. PEM electrolysis, for instance, operates at higher pressures and temperatures, resulting in faster reaction rates and lower energy consumption.
Energy loss in value chain
Energy loss in the value chain poses a significant challenge to the growth of the hydrogen generation market. Hydrogen production involves several stages, from extraction or electrolysis to compression and transportation, each prone to energy losses. For instance, conventional methods like steam methane reforming suffer from energy loss during conversion and transportation of feedstocks. Similarly, electrolysis, though promising for green hydrogen production, faces efficiency losses during electricity generation and conversion. These losses not only decrease the overall efficiency of hydrogen production but also increase costs, making hydrogen less competitive against fossil fuels.
Initially, the market experienced disruptions in supply chains and manufacturing processes due to lockdowns and restrictions imposed to curb the spread of the virus. The pandemic has therefore had an impact on the global market for hydrogen generation due to decreased demand and cash-deficit difficulties among small operators and clients. However, the pandemic also highlighted the importance of clean energy sources, leading to increased interest and investments in hydrogen as a sustainable alternative.
The Biomass segment is expected to be the largest during the forecast period
Biomass segment is expected to be the largest during the forecast period by offering a sustainable and renewable source for hydrogen production. Biomass, derived from organic materials such as agricultural residues, forestry waste, and organic municipal solid waste, can be converted into hydrogen through various thermochemical and biochemical processes like gasification, pyrolysis, and fermentation. This approach not only provides a reliable alternative to fossil fuels but also helps in reducing greenhouse gas emissions, thus addressing environmental concerns.
The Partial Oxidation segment is expected to have the highest CAGR during the forecast period
Partial Oxidation segment is expected to have the highest CAGR during the forecast period. Partial Oxidation involves reacting hydrocarbons with oxygen, typically in the presence of a catalyst, to generate hydrogen gas. This process offers several advantages, including high conversion efficiency, versatility in feedstock selection, and relatively low operational costs compared to traditional methods like steam methane reforming. Moreover, POX can utilize a variety of feedstocks such as natural gas, coal, or biomass, making it adaptable to different geographical and economic contexts.
By harnessing renewable energy sources such as wind and solar power, green hydrogen production significantly reduces carbon emissions, aligning with the region's ambitious climate goals, North America region commanded the largest market share during the projection period. This advancement not only addresses environmental concerns but also fosters energy independence and security by diversifying the energy mix. Moreover, the scalability and versatility of green hydrogen make it a promising solution for decarbonizing various sectors, including transportation and power generation across the region.
Europe region is poised to witness profitable growth over the extrapolated period. Stricter emissions targets and the pursuit of carbon neutrality are driving governments to incentivize the regional adoption of hydrogen technologies. Policies such as the European Green Deal and national hydrogen strategies allocate funding for research, development and infrastructure, fostering innovation and market growth. Additionally, regulatory frameworks provide certainty for investors, encouraging private sector involvement in scaling up hydrogen production and distribution across the region.
Key players in the market
Some of the key players in Hydrogen Generation market include Air Liquide S.A., Ballard Power Systems, Cummins Inc, Fuelcell Energy, Hiringa Energy Limited, ITM Power, Plug Power, Praxair Inc and Siemens.
In October 2023, H2B2, a technology company with a portfolio in Hydrogen production systems, unveiled the green hydrogen plant, which is expected to become operational in North America, the SoHyCal facility located in Fresno, California, United States. The project envisages 100 percent clean hydrogen production using PEM technology.
In October 2023, Hygenco Green Energies announced its plans to operate and construct a cent percent green H2 gas plant in Maharashtra, India. The company also plans to supply green hydrogen and green oxygen to Sterlite Technologies Ltd. This is expected to become one of the first hydrogen Generation Plants in Maharashtra.
In May 2023, the Tokyo Tech InfoSyEnergy Research and Education Consortium, in collaboration with the Tokyo Tech Academy of Energy and Informatics, introduced a fuel cell capable of producing electricity using a combination of hydrogen and hydrogen derived from waste plastic materials.
In February 2023, the leading Indian oil company, Indian Oil Corporation (IOC), embarked on a green transformation strategy worth INR 2 trillion, with the aim of achieving net-zero emissions from its operational activities by 2046. As part of this initiative, Indian Oil Corporation plans to establish green hydrogen facilities at all of its refineries.