Green Hydrogen Market Set for Remarkable Growth with a CAGR of 17.8% between 2023 and 2030, Projected to Reach US$25.4 Billion by 2030

The global green hydrogen market is poised for exceptional growth in the coming years, driven by a rising awareness of sustainable energy solutions and the urgent need to reduce carbon emissions. According to the latest market analysis, the market size is expected to expand at a staggering compound annual growth rate (CAGR) of 17.8% from 2023 to 2030, reaching a market value of approximately US$25.4 billion by the end of the forecast period.

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Market Overview

The global green hydrogen market is witnessing a significant shift away from grey hydrogen production, which currently dominates with over 90% of hydrogen production. Green hydrogen, produced from sustainable resources like solar and wind, is gaining prominence due to its potential to reduce future energy needs and its eco-friendly nature. Key findings from the market analysis include:

  • The commercial viability of green hydrogen production has increased, thanks to declining costs of renewable energy sources, reduced electrolyser costs, and technological advancements.

  • In 2022, the refining segment accounted for more than 61% of the market share, with alkaline electrolysis technology contributing over 52%.

  • Solar photovoltaic (PV) technology held the majority share at over 53% in 2022.

  • Asia Pacific led the market with more than one-third of the market value share, followed closely by Europe.

Market Drivers

The growth of the green hydrogen market is driven by several factors:

  1. Growing Awareness: Rising awareness of hydrogen as a clean energy carrier that produces no greenhouse gases or pollutants is driving its adoption. Hydrogen-based fuel cells are highly efficient, with the potential to generate electricity at up to 60% efficiency compared to traditional combustion-based power plants.

  2. Net Zero Carbon Emission Goals: Public events and campaigns advocating for cleaner technology and support from influential figures are pushing the adoption of green hydrogen to achieve net-zero carbon emission goals.

Market Challenges

Challenges facing the green hydrogen market include:

  1. Expensive Production Costs: Initial setup costs, infrastructure maintenance, and ongoing expenses for green hydrogen production can be significant, potentially hindering market growth. However, increased investments and ongoing R&D projects aim to develop cost-effective production technologies.

  2. COVID-19 Impact: The COVID-19 pandemic disrupted supply chains and led to operational challenges, affecting various industries, including the green hydrogen market. While the market has recovered, the impact of the pandemic still lingers.

Key Segments

The market can be divided into segments based on application, technology, and energy source:

  • Application: In 2022, refining accounted for the largest share (61.3%), but this is expected to gradually decrease over the next seven years, with growth in transport and other sectors such as iron & steel and chemicals.

  • Technology: Alkaline electrolysis held the majority share in 2022 (52.4%), but PEM electrolysis is expected to gain market share by 2030 due to its high-purity hydrogen production capabilities and ease of cooling.

  • Energy Source: Solar PV technology dominated in 2022 (53.8%) and is expected to maintain its dominance, particularly in regions with high solar intensity. Solar-based power is preferred for electrolysis, especially where sunlight is abundant.

Regional Growth Opportunities

  • Europe: Europe is expected to see strong growth in both green hydrogen production and consumption. Initiatives like HyDeal, NortH2, and AquaVentus, along with efforts to reduce green hydrogen costs, are driving expansion.

  • North America: The United States leads the green hydrogen market, with several new projects in the pipeline. Favorable clean energy legislation and significant investments are contributing to the region's growth.

  • Asia Pacific: Dominating the global green hydrogen market, Asia Pacific is poised for significant expansion. China, India, Australia, and several ongoing projects are driving growth in the region.

Competitive Landscape

Key players in the global green hydrogen market include FuelCell Energy, Inc., Adani Green Energy, Bloom Energy Corporation, Linde Plc, Royal Dutch Shell, Plug Power, Inc., Air Products & Chemicals Inc., Air Liquide S.A., Reliance Industries, TotalEnergies, and BP p.l.c.

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