Hydrogen Generation Market

Hydrogen Generation Market Outlook (2024 to 2034)

The global hydrogen generation market is estimated at US$ 156.9 billion in 2024. Increasing at a CAGR of 7%, revenue from hydrogen generation is expected to reach US$ 308.7 billion by the end of 2034.

Declining cost of solar photovoltaic coupled with ascending sales of hydrogen fuel cell automobiles are positively influencing the hydrogen generation market growth. Production of low-carbon hydrogen at scale using fossil fuel is further boosting the adoption of industrial hydrogen generation products.

Emphasis on low-cost, clean energy gives impetus to hydrogen generation. From the United States to Australia, respective governments across the globe are encouraging hydrogen deployment by combining incentives and generation targets. Manufacturers of passenger cars particularly are enjoying the highest incentives for hydrogen adoption. The increasing demand for reducing carbon footprint from refinery activities is an emerging hydrogen generation market trend.

North America is a major market for hydrogen generation technology providers. The rising investments in research and development efforts by respective authorities are supporting the hydrogen-based activities and applications.

• North America is estimated account for 32.7% of the global hydrogen generation market share in 2024.
• The East Asian hydrogen generation market size is forecasted to reach US$ 75.9 billion by 2034.

Report Attributes	Details
Hydrogen Generation Market Size (2024E)	US$ 156.9 Billion
Forecasted Market Value (2034F)	US$ 308.7 Billion
Global Market Growth Rate (2024 to 2034)	7% CAGR
South Korea Market Value (2034F)	US$ 10.6 Billion
Key Companies Profiled	Proton Onsite Teledyne Energy System Hydrogenics Iwatani Air Liquide Air Products and Chemical Plug Power Praxair Showa Denko Fuelcell Energy Linde Messer Group Taiyo Nippon Sanso Xebec Claind Erredue Ally Hi-Tech Ballard Power Systems Caloric Hygear Nuvera Fuel Cells

Which Aspects are Pushing Sales of Hydrogen Generation Technologies?

“Rising Industrial Pollution Leading to Surge in Captive Hydrogen Generation”

Cost of conveyance and distribution of hydrogen is propelling the demand for captive hydrogen generation systems. Omnipresent regulatory emphasis on reducing industrial pollution is driving manufacturers to capture by-product hydrogen produced in manufacturing processes. Countries such as the United States and Russia have an extensive network of gas pipelines, adoption of which is expected to result in cost effective and energy efficient hydrogen deliveries.

“Green Hydrogen Gaining Traction Worldwide”

Hydrogen produced is mostly used by petroleum refineries and fertilizer producing companies. A total of 99% of hydrogen comes from fossil fuel reforming, as it is the most conventional and cost-effective method. But it is not beneficial for the environment due to CO2 emission. Green hydrogen is produced from electrolysis. Electrolysis is the method used to produce green hydrogen as it uses electricity to split water into hydrogen and oxygen and gives out zero carbon emissions.

• One of the objectives that various countries have set for 2050 is the decarbonization of the earth. For instance, the European Union (EU) released a unique hydrogen policy in 2020 that combines initiatives to support green hydrogen generation capacities’ growth.
• In 2023, Florida Power & Light Company (FPL) announced the launch of first clean hydrogen pilot project in Florida.

What Challenges are Faced by Industry Leaders?

“Unavoidable Energy Loss During Hydrogen Generation”

Use of high-grade electrical energy to compress, liquefy, transport, or store the medium is creating challenges for hydrogen generation solution providers. In addition, this energy input requires to ideally match the energy level of the synthetic gas. Any method of producing hydrogen, such as electrolysis and reforming, involves energy transformation. The chemical energy of hydrogen is converted from electrical energy or the chemical energy of hydrocarbons. Unfortunately, energy losses are always a part of the creation of hydrogen.

Energy loss occurs across every step of the value chain for hydrogen production. In the production stage, the energy needed for electrolysis is lost by around 30%. An additional 10 to 25% of energy is lost during conversion to other forms. Energy input is needed to deliver green hydrogen, either in the form of fuel for vehicles or energy from pipes. Utilizing hydrogen in fuel cells results in more energy loss. Thus, these factors are hindering the growth of the hydrogen generation market.

Comparative View of Hydrogen Generation Markets

Hydrogen Generation Market :

Attributes	Hydrogen Generation Market
Forecasted Market Value (2034F)	US$ 308.7 Billion
Growth Factor	Advancements in hydrogen generation methods boosting overall market growth.
Opportunity	Increasing demand for carbon less hydrogen generation across the globe is creating lucrative opportunities for hydrogen generation technology providers.

Hydrogen Market :

Attributes	Hydrogen Market
Forecasted Market Value (2034F)	US$ 47.83 Billion
Growth Factor	Initiatives by several countries to reduce carbon emission will boost use of hydrogen.
Opportunity	Innovations in electrolysis, fuel cell, and storage technologies to boost overall market growth.

Hydrogen Vehicle Market :

Attributes	Hydrogen Vehicle Market
Forecasted Market Value (2034F)	US$ 883 Billion
Growth Factor	Alternative fuel vehicles that use hydrogen for motive power creating lucrative opportunities for hydrogen vehicle market players.
Opportunity	Increasing investments in R&D to develop advanced hydrogen vehicles.

Hydrogen Sensor Market :

Attributes	Hydrogen Sensor Market
Forecasted Market Value (2034F)	US$ 680 Million
Growth Factor	Hydrogen sensors exhibiting extensive demand in wide range of end-use industries, including the automotive industry.
Opportunity	Incorporation of IoT and the data generated by sensors to connect the crucial assets of enterprises is set to advance the use of hydrogen sensors.

Start-up Ecosystem

• H2Pro is an Israeli start-up founded in 2019 that offers cost-effective hydrogen fuel produced through sustainable energy. The company’s E-TAC electrolyzer is an advanced system to produce hydrogen through splitting water at 95% energy efficiency.
• A Swiss start-up Neology is founded in 2023. The company transforms ammonia into hydrogen using its Ammonia to Ammonia-to-Hydrogen Generation System (AHGS). The company’s solution caters to the need for clean and high-energy fuel sources in commercial transportation.

Country-wise Analysis

How is Captive Hydrogen Generation Driving United States Market Growth?

“United States Handsomely Leading Sales of Hydrogen Generation Technologies”

Attribute	United States
Market Value (2024E)	US$ 36.8 Billion
Growth Rate (2024 to 2034)	7.8% CAGR
Projected Value (2034F)	US$ 78.3 Billion

Surging demand for oil & gas production to support robust economic development results in continuous demand for hydrogen generation in the United States. Modernization of small and medium sized industries is set to boost the demand for cost efficient captive hydrogen generation systems during the forecast period. The United States market growth can also be attributed to comprehensive gas pipeline networks in the country. The ease of hydrogen logistics acts as a central factor driving market growth.

How is the Market for Hydrogen Generation Faring in Japan?

“Growing Adoption of Desulphurization Process Augmenting Sales of Hydrogen Generation Solutions”

Attribute	Japan
Market Value (2024E)	US$ 11 Billion
Growth Rate (2024 to 2034)	7.2% CAGR
Projected Value (2034F)	US$ 21.9 Billion

High pollution in Asian countries such as Japan, India, and China is creating high demand for desulfurization of fuels to conserve the environment. This is positively influencing the adoption of hydro desulphurization (HDS) processes and ultimately increasing the demand for hydrogen generation. Thus, East Asia and South Asia & Oceania countries are presenting high-growth opportunities for key players in the hydrogen generation market.

Category-wise Analysis

Where are Hydrogen Generation Systems Widely Used?

“Rising Utilization of Hydrogen Generation Technologies in Petroleum Refining”

Attribute	Petroleum Refining
Segment Value (2024E)	US$ 84.1 Billion
Growth Rate (2024 to 2034)	6.9% CAGR
Projected Value (2034F)	US$ 163.6 Billion

Hydrogen is indispensible for refining operations. Companies are using hydrodesulphurisation process to remove sulphur for fuel produced. The use of hydrogen in refining industry is to remove impurities and increase quality of yield product. To remove impurities from crude oil requires high volume of hydrogen. Thus, hydrogen generation technology providers are witnessing high-growth opportunities in petroleum refining processes.

Which Technology is Preferred for Hydrogen Generation?

“Coal Gasification Considered Mature Technology for Hydrogen Generation”

Attribute	Coal Gasification
Segment Value (2024E)	US$ 29.7 Billion
Growth Rate (2024 to 2034)	7.3% CAGR
Projected Value (2034F)	US$ 60.2 Billion

Coal gasification technology is widely used for hydrogen generation from coal. Currently, large-scale coal gasification installations are basically for energy generation or for the production of chemical feedstocks. Furthermore, the hydrogen obtained from gasification can be utilized for various purposes such as for powering hydrogen economy, making ammonia, or for fossil fuel upgradation.

Competitive Landscape

Industry leaders are targeting countries with a high-adoption rate of hydrogen fuel cell automotive. Governments with proposed investments in developing hydrogen refueling stations are popular target regions among major hydrogen generation companies. The market is consolidated with tier-1 players accounting for a majority of revenue share.

These organizations are forging strategic partnerships, merging and acquiring local players in key growth areas. Value additions in terms of footprint expansion, disruptive technologies such as solar-based hydrogen generation systems garner the most profitable company valuations for local players.

• In February 2021, Air Liquide and Siemens Energy entered into partnership for developing electrolyzer on a large scale for sustainable hydrogen production.
• In August 2022, Air Products announced the partnership with Associated British Ports for renewable hydrogen production. Through this partnership, the companies are driving the United Kingdom’s sustainability goal.

Key Segments of Hydrogen Generation Market Research

• By Technology :

  • Coal Gasification
  • Steam Methane Reforming
  • Others

• By System :

  • Merchant Hydrogen Generation
  • Captive Hydrogen Generation

• By Application :

  • Methanol Production
  • Ammonia Production
  • Petroleum Refining

• By Region :

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • Middle East & Africa