Hydrogen Generation Market Size, Share & Industry Analysis, By Type (On-site and Portable), By Technology (Steam Methane Reforming, Water Electrolysis, Partial Oil Oxidation, and Coal Gasification), By Application (Ammonia Production, Petroleum Refinery, Methanol Production, Transportation, Power Generation, and Others), and Regional Forecast, 2024-2032

The global hydrogen generation market size was valued at USD 167.62 billion in 2023 and is projected to grow from USD 176.74 billion in 2024 to USD 278.26 billion in 2032, exhibiting a CAGR of 5.84% during the forecast period. The Asia-Pacific dominated the hydrogen generation market with a share of 33.77% in 2023. The Hydrogen Generation market in the U.S. is projected to grow significantly, reaching an estimated value of USD 45.82 billion by 2032, driven by the shifting focus toward viable sustainable and low-carbon energy solutions.

Hydrogen or H₂ is a flammable and odorless element abundantly present in nature in various forms. The chemical element is generally available in the gaseous state within the atmosphere and can also be produced as a product and byproduct of different procedures. Besides, hydrogen is also significantly used as a clean fuel alternative to electricity generation and propel vehicles. The H₂ fuel is widely used in fuel cell devices due to its ability to curb harmful discharges and deliver water vapor and heat as the only output. Besides, different FC production companies such as Nuvera Fuel Cells, LLC and Ballard Power Systems, among others, are continuously striving to introduce advanced systems with feasible integration in various applications. Furthermore, different methods such as steam methane reforming and electrolysis are adopted across the industry to generate H₂ to serve the increasing requirements in numerous applications.

The abrupt outbreak of Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2), or novel coronavirus spreading from China to the whole world, has deteriorated the economic systems. Stringent government regulations, such as national & state lockdowns, restricted international traveling, and social distancing norms to contain the virus negatively impacted the financial health of countries. The operations across the industrial facilities, manufacturing plants, and road transportation have converted into standstill conditions to curb the human transmission of infection.

Consequently, the global hydrogen generation market has also been implicated by the pandemic due to the decreasing demand and cash deficit problems among small players and customers. However, numerous governments have unveiled their plans to utilize the low carbon pollution conditions caused by the shutdown of industrial and transport sectors, augmenting the demand for clean fuel alternatives, such as hydrogen, in a post-COVID world.

For instance, in December 2020, the government of Japan introduced a new fund totaling over USD 19 billion as an additional COVID-19 stimulus package for the hydrogen industry. The financial assistance is likely to propel new green projects for the next ten years and aims at introducing H₂ powered planes and cargo ships to commence the usage of hydrogen as a reliable power source.

MARKET TRENDS

Collaboration Activities Among Industry Players to Drive the Market Growth

Numerous participants functioning across various stages in the industry are focused on expanding their horizons and set up new generation industries. Besides, partnership agreements to produce green H2 fuel with zero-emission technologies are likely to pave the way for the global hydrogen generation market growth. For instance, in March 2021, Plug power Inc. announced to join forces with different divisions of Brookfield Renewable Partners to construct a green hydrogen plant in Pennsylvania, U.S. The new facility is set to generate H2 with 100% renewable sources to support the decarbonization of logistics and transportation industries by producing about 15 metric tons of liquid hydrogen daily. The construction is projected to begin from the first quarter of 2022, and operations will start late in the same year.

Favorable Government Policies and Initiatives to Shape the Industry Trends

The governments from different emerging as well as developed countries have shown significant interest in achieving carbon neutrality. Additionally, the administrations have also updated their strategies to include clean energy sectors in their future prospects fueling the expansion of the hydrogen generation industry. For instance, in March 2021, India and the U.S. governments have decided to update their strategic energy partnership to include low carbon technologies such as hydrogen and biofuels. The two nations have also agreed to boost the R&D activities with programs such as Partnership to Advance Clean Energy Research for renewable energy.

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GROWTH FACTORS

Vast Deployment of Hydrogen Fuel Cell Vehicles to Boost the Technology’s Demand

Rapidly increasing demand for fuel cell electric vehicles (FCEVs) such as passenger vehicles, buses, trucks, and other heavy-duty automobiles is likely to surge the need for this market. FCEVs are installed with a fuel cell device, and they operate by utilizing hydrogen as a primary fuel enabling harmful emission-free working. Additionally, colossal FCEV deployment targets from numerous governments have led to a significant increase in the number of FCEVs on roads. For example, in June 2020, the International Energy Agency (IEA) reported that South Korea aims to deploy about 81,000 FCEVs by 2022, along with 2.9 million vehicles by 2040.

Deployment of Strict Regulations by Government Bodies to Limit Green House Gas Emissions to Fuel Market Growth

Global greenhouse gas emissions are growing on a daily basis owing to the expansion of industrial activities. As a result, climate change is seen at their worst conditions. Considering this, environmental change is going to be a huge problem in the forecast years. To control such climate issues, several government bodies are trying to focus on renewable sources.

For instance, the National Highway Traffic Safety Administration (NHTSA) and The U.S. Environmental Protection Agency (EPA) have launched the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule.

This regulation sets lower standards for GHG emissions and Corporate Average Fuel Economy (CAFE) for vehicles formed between 2021–2026 in the U.S. The new regulation will constrict CAFE and carbon dioxide (CO2) emissions criteria until 2026. Implementation of such acts by the government will create new opprtunities in the market for hydrogen as a fuel. It will help the hydrogen generation market to boost in the forecast years.

RESTRAINING FACTORS

Substantial Production Costs coupled with High Energy Consuming Generation Technologies

H2 fuel is commercially produced through different technologies requiring significant capital to set up and operate the plants hindering the global market pace. Also, high energy consumption to produce hydrogen using processes like water electrolysis is very costly as it needs additional electricity to break water molecules into hydrogen and oxygen.

Hydrogen Generation Market Segmentation Analysis

By Type Analysis

The on-Site Segment is Backed by its Cost-Effective Nature and Operational Benefits

Based on type, the market can be primarily bifurcated into portable and on-site. The on-site hydrogen generation segment is likely to hold a significant market share owing to their economical installations coupled with safe and efficient operations. Additionally, the portable type is also anticipated to observe substantial growth over the forecast period due to the growing placement of FCEVs with various power rating fuel cells.

By Technology Analysis

Higher Energy Efficiency to Favor the Steam Methane Reforming Segment Growth

Based on technology, this industry can be majorly segregated into water electrolysis, coal gasification, steam methane reforming, and partial oil oxidation. The steam methane reforming segment is projected to account for a significant portion owing to its better output, low-cost operations, and input fuel flexibility. Furthermore, the growing demand for automotive fuel cells to power private and commercial transportation fleets is likely to favor the partial oil oxidation segment growth.

Coal gasification technology is backed by the abundant availability of different coal reserves and the substantial dependability of various nations of coal as a primary fuel. Subsequently, the water electrolysis segment is expected to grow at a steady rate due to its ability to produce H2 with zero emissions while maintaining the technical performance presenting a huge potential.

By Application Analysis

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Ammonia Production Segment to Lead Stoked by Cont

Based on application, the global market for hydrogen generation is divided into petroleum refinery, ammonia production, transportation, methanol production, power generation segment, and others. Ammonia production application is likely to lead the market size due to the capabilities to utilize different technologies, growing technical expertise, and synthesizing ammonia in large volumes.

Additionally, the petroleum refinery application is also projected to observe significant growth due to the continuous requirement of H₂ to desulfurize the diesel fuel and comply with stringent regulations. Continuous deployment of fuel cell vehicles and setup of new hydrogen refueling stations to provide customers with readily available fuel is set to propel the transportation segment.

REGIONAL INSIGHTS

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The market has been analyzed geographically across five key regions such as Europe, North America, Asia Pacific, the Middle East and Africa, and Latin America. Asia Pacific market was accounted as leading regiona and is projected to dominate the market during the forecast period. Favorable government policies, huge fuel cell vehicle targets, rising energy demand, and growing investments in hydrogen refueling infrastructure are some of the key factors propelling the regional outlook. For instance, in March 2019, the Ministry of Economy, Trade, and Industry (METI) updated the national hydrogen strategy to place 200,000 FCEV units by 2025 and 800,000 units by 2030.

The growing focus of various organizations to change primary energy generation to cleaner fuels to stimulate the North American market size. Furthermore, dedicated research & development programs by the regional authorities to support the hydrogen-based activities and applications. For instance, the Hydrogen and Fuel Cell Technologies Office, under the U.S. Department of Energy (DoE), has launched the Hydrogen Program to support the H2 production, infrastructure, delivery, storage, and other uses across different sectors, including stationary, industrial, and transportation.

Additionally, the nations across Europe invest heavily to boost their hydrogen production capacities and abide by the stringent carbon emission reduction targets propelling the regional landscape. Europe has observed considerable adoption of hydrogen-powered vehicles and the rise in energy demand and boost in hydrogen infrastructure development. For instance, in September 2020, the government of France unveiled its national hydrogen strategy targeting to augment the hydrogen generating capacity of 6.5 GW and create an investment of about EUR 7.2 billion by 2030.

List of Key Companies in Hydrogen Generation

Air Liquide is Concentrating to Explore New Ventures to Boost its Capabilities

The competitive landscape across the global hydrogen generator market includes various participants operating at various stages in the supply chain at different levels. The market players are also significantly emphasizing the advancement in the generation capacity while improving efficiency and quality. Additionally, the companies are also focused on initiating partnership contracts to augment the production capacities and develop low carbon generation technologies.

Air Liquide, a France-based industrial gas producer, and supplier, is also focusing on fortifying its H2 generation capabilities to serve the decarbonization programs for energy uses. For instance, in February 2021, the company announced a Memorandum of Understanding (MoU) with Siemens Energy to set up a large-scale electrolyzer production unit and R&D facility for advanced electrolyzer technologies. The collaboration aims to construct an industrial-scale electrolyzer facility with a 200 MW capacity to support sustainable hydrogen generation in Normandy, France.

LIST OF KEY COMPANIES PROFILED:

• Air Liquide (France)


• Iwatani Corporation (Japan)


• Hydrogenics (Canada)


• Messer Group (Germany)


• Showa Denko K.K. (Japan)


• Linde (UK)


• Epoch Energy Technology Corporation (Taiwan)


• Idroenergy Spa (Italy)


• Praxair, Inc (U.S.)


• Air Products (U.S.)


• McPhy (France)


• LNI Swissgas (Switzerland)


• Airgas (U.S.)


• Parker Hannifin (U.S.)


• FuelCell Energy (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• April 2024 - A Gujarat state govt committee has, in principle, permitted allotting 63,000 hectares for making green hydrogen from wind, solar, and wind-solar hybrid energy sources. These site parcels are located in Banaskantha, Kutch, and Patan districts.


• April 2024- Accelera by Cummins, the energy technology company, will deliver Chevron New Energies with a 5-MW electrolyzer technology system for the production of low carbon intensity (LCI) electrolytic hydrogen at its capacity plant in Lost Hills, CA.


• March 2024 - GAIL Ltd. (India), a state-run natural gas company, plans to contract its first green hydrogen project in central India in 2024. Moreover, The 10MW  proton exchange membrane electrolyzer, the production of green-hydrogen, has been imported to the Vijaipur complex in Madhya Pradesh from Canada.


• February 2021 – China Petroleum & Chemical Corporation (Sinopec) unveiled its strategy to construct around 1,000 hydrogen fueling stations over the next five years. The new infrastructure is set to boost the hydrogen generation output and propel clean energy across the nation.


• December 2020 – Seven key companies, namely Envision, Snam, ACWA Power, Iberdrola, CWP Renewables, Yara, and Ørsted, initiated a new global alliance called “Green Hydrogen Catapult” to increase the green H2 output by 50 folds. The coalition aims to install 25 GW of hydrogen production from renewable sources and simultaneously reduce the production cost to lower than USD 2 per kilogram by 2026.

REPORT COVERAGE

The global hydrogen generation market report presents a comprehensive assessment of the global market by offering valuable insights, facts, industry-related information, and historical data. Several methodologies and approaches are adopted after analyzing annual reports, presentations, press releases, and other technical studies by key companies and organizations to make meaningful assumptions and views. Furthermore, the market research report offers a detailed industry analysis and information as per segments, helping our readers to get a comprehensive overview of the global market.

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