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The hydrogen market size is forecast to increase by USD 92.35 billion and is estimated to grow at a CAGR of 7% between 2023 and 2028. The report includes historic market data from 2018-2022. The market is witnessing a growing demand for investments by vendors in hydrogen production, ongoing advancements in the production technologies and the development of regional hydrogen hubs and clusters.
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Growing investments by vendors in hydrogen production is an emerging trend shaping the market growth. For instance, on July 19, 2022, Shanghai Chemical Industry Park Industrial Gases Co., Ltd (SCIPIG), a subsidiary of Air Liquide, announced that it is set to invest more than USD 220 million in constructing two hydrogen production units and associated infrastructure within the Shanghai Chemical Industry Park (SCIP). Through contracts spanning over 15 years, these units will generate hydrogen and carbon monoxide for the supply to Covestro China and Shanghai Lianheng Isocyanate Company (SLIC), a joint venture led by BASF and Huntsman, within the park.
Additionally, the units will cater to mobility, other industrial, and electronics customers in the Yangtze River Delta megalopolis. The total hydrogen (H2) production capacity of the two units will be approximately 70,000 Nm3/h. They will also feature units for capturing and recycling carbon dioxide (CO2) to contribute to the production of carbon monoxide (CO), with a total capacity of 28,000 Nm3/h. Thus, the growing number of investments in hydrogen production is expected to drive the growth of the market during the forecast period.
The chemical industry segment is estimated to witness significant growth during the forecast period. Hydrogen is one of the important preliminary supplies used in the chemical industry. Hydrogen is used mainly to manufacture methanol and ammonia. It is an important ingredient in the manufacture of methanol, polymers, and ammonia, thereby playing a key role in the fertilizer sector.
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Hydrogen is also used in the manufacture of methanol, which is used as a direct fuel or as a blended fuel like gasoline. According to the US Energy Information Administration, liquid fuels stem from their use of methanol and its derivatives, owing to the increased adoption in China's gasoline and liquefied petroleum gas (LPG) streams. In China, the use of methanol as an alternative for energy and fuels is anticipated to grow at a significant rate during the forecast period. Methanol is blended into gasoline pools in an indirect manner or by using a methanol derivative. In China, it is blended into LPG streams as a low-cost substitute and consumed in the domestic LPG cylinder market. The increasing demand for fertilizer and direct fuels will drive the growth of the global market as hydrogen is one of the key components to manufacturing fertilizers, transportation fuels, and domestic fuel products. This, in turn, is likely to boost the growth of the chemical industry segment in the global market during the forecast period.
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APAC is estimated to contribute 56% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The market in APAC is expected to grow significantly during the forecast period, owing to increasing focus on regional government adoption of clean energy sources such as green hydrogen. Countries such as India, China, and Japan are the major contributing countries in terms of revenue to the growth of the regional market. China stands as a major player in the APAC market, driven by its commitment to clean energy and efforts to reduce carbon emissions. The country is a significant producer of grey hydrogen, primarily through coal gasification and steam methane reforming.
However, China is increasingly emphasizing the development of green hydrogen, investing in renewable energy sources like solar and wind for electrolysis. The government's 14th Five-Year Plan includes provisions to advance hydrogen technologies, with a focus on industrial applications and transportation, positioning China as a key contributor to the global hydrogen landscape. Such initiatives taken by the government in the region are expected to drive the growth of the regional market during the forecast period.
Increasing government focus on the adoption of clean hydrogen is notably driving the market growth. Growing government initiatives and policies play a pivotal role in shaping the trajectory of the global market, providing crucial support and direction for its growth. One notable example is the European Union's ambitious Hydrogen Strategy, which aims to establish a clean hydrogen market and facilitate the production of green hydrogen using renewable energy sources.
In addition, in the United States, the Biden administration's focus on clean energy has led to the inclusion of hydrogen in the American Jobs Plan. The plan allocates substantial funds for the development and deployment of hydrogen technologies, emphasizing the role of hydrogen in achieving climate goals and promoting job creation. Thus, the increasing government focus on boosting hydrogen generation is expected to drive the growth of the market during the forecast period.
High costs associated with the production of green and blue hydrogen is a significant challenge hindering the market growth. The production costs associated with different hydrogen types, especially green and blue hydrogen produced through renewable energy, remain relatively high. The current levelized cost of producing green hydrogen ranges widely from USD 3 to USD 6 per kilogram, rendering it economically unviable. The cost of green hydrogen production is primarily influenced by the capital expenditure (CAPEX) of electrolyzers, their capacity or utilization factor, and the procurement cost of renewable electricity. CAPEX encompasses expenses related to the electrolyzer system or stack, essential balance of plant components, and electricity grid connection.
Additionally, the capital cost encompasses essential components such as the reformer unit, steam turbine, necessary balance of plant, and other units depending on the technology employed, such as steam methane reforming (SMR) and auto thermal reforming (ATR). Thus, the high costs associated with the production of green and blue hydrogen can become a major challenge for the growth of the market during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Air Liquide SA - The company offers hydrogen used in fuel cells to generate heat and electricity used in many industrial sectors such as refining, chemistry and metallurgy.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The Hydrogen Market witnesses increased investment in hydrogen infrastructure, driven by demand for low emission fuel amid tightening greenhouse gas emissions regulations. Various applications include energy, chemical & refinery, and mobility, with a focus on storage, transportation, and fuel cell technologies. Infrared radiation is leveraged for pollution control rules, promoting clean fuels. The Biden-Harris Administration supports the market's growth trajectory, emphasizing the importance of hydrogen as a sustainable energy solution to combat greenhouse gases and meet emission reduction targets.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest market growth and trends and growth opportunities from 2018 to 2028.
Market Scope |
|
Report Coverage |
Details |
Page number |
167 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 7% |
Market Growth 2024-2028 |
USD 92.35 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
6.5 |
Regional analysis |
APAC, Europe, North America, Middle East and Africa, and South America |
Performing market contribution |
APAC at 56% |
Key countries |
US, China, Japan, Germany, and France |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Air Liquide SA, Air Products and Chemicals Inc., BayoTech Inc., Caloric Anlagenbau GmbH, Ceres Power Holdings plc, Chart Industries Inc., Chevron Corp., Iwatani Corp., Linde Plc, Mahler AGS GmbH, Messer SE and Co. KGaA, Nel ASA, Orsted AS, Oxygen Service Co., Plug Power Inc., Resonac Holdings Corp., Saudi Arabian Oil Co., Shell plc, Siemens AG, and Uniper SE |
Market dynamics |
Parent market analysis, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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