CLEAN HYDROGEN MARKET ANALYSIS

The global clean hydrogen market size was valued at US$ 3.81 Billion in 2022 and is anticipated to witness a compound annual growth rate (CAGR) of 14.1% from 2023 to 2030. Global clean hydrogen market is expected to expand during the forecast period as there is a rise in awareness regarding carbon emissions and alternatives. Moreover, the production of greenhouse gases like nitrous oxide, carbon dioxide, and methane have increased in many nations because of industrialization and modernization, resulting in the growth of global temperature which is harmful for the ecosystem. The governments of the countries are taking various initiatives to control these carbon emissions and reduce global warming by encouraging the use of hydrogen gas in processes such as building, power generation, industry and transportation.

Global Clean Hydrogen Market: Regional Insights

Based on geography, the global clean hydrogen market is segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.

Regionally, Europe is expected to dominate the global clean hydrogen market over the forecast period owing to the climate-friendly policies and strict frameworks, the contribution from countries such as France, Spain, Italy, Norway, the UK has made a significant impact on the global clean hydrogen market. According to the Coherent Market Insights analysis, in 2020, the European market accounted for a share of 82.51% in the global clean hydrogen market. Moreover, growing number of clean hydrogen projects is also expected to fuel regional market growth. For instance, in January 2021, The Indian Energy Company Essar has partnered with the UK-based Progressive Energy, a specialist in low-carbon technologies, to build two plants at Essar refinery in England. The company will use the Johnson Matthey technology to make low-carbon hydrogen fuel from natural gas or fuel gases.

North America is accounted for 18.9% of the global revenue share in 2022.The region has the second- largest market for clean hydrogen. Factors such as growing power consumption, increasing population, rapid industrialization and urbanization are fueling the demand for clean hydrogen in the region. Moreover, the growing deployment of renewable energy resources in residential and commercial segments due to increasing consumer purchasing power and regulatory changes are key factors augmenting regional market growth.

Figure 1: Global Clean Hydrogen Market, By Region 2023

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Global Clean Hydrogen Market Drivers:

Increasing government support for effective usage of energy is expected to drive market growth

For instance, the government of California is planning to invest $230 million in hydrogen projects before 2023. The world’s largest clean hydrogen projects are being built in Lancaster, CA, by an energy company. The Government of India is planning to increase its renewable energy capacity to 450 GW by 2030. The country’s huge renewal potential in terms of surplus solar and wind power capacity will enable the creation of a robust clean energy-based green hydrogen ecosystem. Hence, such support from government is expected to fuel market growth.

Growing environmental concerns is expected to propel market growth

The demand for clean hydrogen is on the rise with increasing environmental concerns. The industry is growing at a fast pace and it has the potential to disrupt traditional energy markets. Moreover, clean hydrogen can be manufactured by electrolysis from renewable or low carbon sources such as water and wind power. This makes it a feasible source of energy to replace fossil fuels in power generation, and manufacturing sector.

Global Clean Hydrogen Market Opportunities:

Hydrogen is a clean and safe energy source that can significantly contribute to the decarbonization of the economy. Also, it is a key ingredient in energy strategies that are important to curb CO2 emissions and meet the global climate goals. For this governments and companies are creating right incentives based on a technology neutral and carbon intensity that would open new avenue for the market growth.

The clean hydrogen market has great potential especially across developing world. As more developing nations become industrialized which is creating high levels of energy demand, they will need more and more clean-energy technologies. This is making the market for clean hydrogen even more attractive in developing countries.

Global Clean Hydrogen Market Trends:

Increasing investment in the sector is a growing trend

Various countries are increasing the investment in the clean hydrogen sector. This is expected to increase the widespread use of hydrogen and play a key role in the commercial-scale deployment of hydrogen. For instance, in March 2023, the Biden-Harris Administration, through the U.S. Department of Energy (DOE), today announced the availability of $750 million for research, development, and demonstration efforts to dramatically reduce the cost of clean hydrogen. Hence, it is an excellent investment opportunity for who leveraging existing infrastructure and economies of scale and develop innovative solutions to address the needs of key end users.

Growing popularity of clean hydrogen

Hydrogen is a clean energy carrier and is becoming increasingly attractive to governments and various companies. Since the world tries to achieve net zero emissions and decarbonize its economies, hydrogen has emerged as a key alternative fuel. As a renewable source, it produces no carbon dioxide and can be used for heat buildings, to power transport, produce electricity, and make chemicals. This offers a valuable bridge to a low-carbon future.

Global Clean Hydrogen Market Restraints:

Physical & chemical properties of clean hydrogen is expected to hamper market growth

Clean hydrogen is highly flammable and is light like other fuels, and hence, it must be handled carefully. Moreover, it is more flammable than other fuels such as natural gas, gasoline, and propane. Also, the low density of hydrogen makes its transportation a challenging task. All these factors are projected to hinder the market growth.

High production cost is projected to hinder market growth.

The cost of clean hydrogen is in the range of $2.5/Kg–$6/Kg. The production of clean hydrogen is much more expensive when compared to other hydrogen variants, such as grey and blue. This is another key factor expected to restrict the market growth.

Figure 2: Global Clean Hydrogen Market, By Application 2023

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Global Clean Hydrogen Market Segmentation:

The global clean hydrogen market report is segmented into technology, end user, and geography

Based on technology, the market is segmented into Alkaline Electrolyzer, Pem Electrolyzer, and Soe Electrolyzer. Out of which, Alkaline Electrolyzer is expected to dominate the global market over the forecast period and this is attributed to their simple design. Moreover, it is also relatively effortless as compared to others technology.

Pem Electrolyzer segment is also expected to witness significant growth in the near future owing to growing popularity of this technology across various sector.

Based on end user, the market is segmented into Transport, Industrial, Power Generation, and Others. Out of which, Transport is expected to dominate the global market over the forecast period. The industry is among the promising for the development of hydrogen technologies due to heavy reliance on oil products and to the few low-carbon options in different applications. Moreover, hydrogen vehicles have huge advantages when compared to electric vehicles. It can be used in vehicles to power cars, trucks, buses and freight trains.

Power Generation segment is also expected to witness significant growth in the near future and this is owing to the growing demand for clean energy sources.

Global Clean Hydrogen Market: Key Developments

In September 2022, Linde announced the construction of a 35-megawatt PEM (Proton Exchange Membrane) electrolyzer to produce green hydrogen in Niagara Falls, New York. The new plant will be the largest electrolyzer installed by Linde globally and will more than double Linde’s green liquid hydrogen production capacity in the United States

In March 2022, Honeywell announced that it has developed new catalyst-coated membrane (CCMs) technology for Green Hydrogen production and will further test the technology with electrolyzer manufacturers.

Global Clean Hydrogen Market: Key Companies Insights

The global clean hydrogen market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global clean hydrogen market are Linde Plc, Air Liquide, Engie, Uniper Se, Air Products Inc, Clean Hydrogen System, Cummins Inc., Toshiba Energy Systems & Solutions Corporation, Nel Asa, and Sgh2 Energy

*Definition: Clean hydrogen is an excellent alternative fuel for cars, trucks and ships. It’s also a valuable way to store energy over long periods of time and to move and deliver it where it is needed.