The global market for environmentally friendly hydrogen could reach a volume of 2027 billion dollars (2,28 billion euros) by 1,99, estimates Grand View Research, Inc. This corresponds to a compound annual growth rate (CAGR) of 14,24 percent. In 2019, the green hydrogen market was estimated at $786,9 million.
Growing subsidies for the use of clean fuels as well as investments by the hydrogen economy in environmentally friendly alternatives to the fossil fuel economy would likely strengthen market growth over the forecast period, according to the US management consultancy. According to the study, Germany has a comparatively high market share, which can be attributed to political support, especially with research funding for demonstration projects. Analysts expect the country to lead the market during the forecast period as there are a large number of projects in the pipeline. Transmission and gas network operators Ampiron GmbH and Open Grid Europe GmbH (OGE) are working to build an electrolyser capacity of 100 megawatts (MW) together with a dedicated pipeline for hydrogen transport in northwest Germany, which is expected to go online in 2023.
Market growth is also influenced by the fact that countries such as Germany, Japan and the USA are pushing forward the introduction of hydrogen in the transport sector in order to push back conventional fossil fuels.
In 2019, Europe had a global market share of more than 57 percent in the hydrogen segment. This is “due to the huge investments made by European economies as they strive to transition to a clean, hydrogen-based economy.” For example, in August 2019, the British government announced a $14,8 billion investment plan for a project expected to use four gigawatts of offshore wind energy to produce green hydrogen by 2030.
North America will also “achieve an outstanding growth rate” in the forecast period. In the USA, California has the largest market share with its “aggressive decarbonization goals” such as the gradual abolition of gas or diesel-powered public buses by 2040. In Canada, Air Liquide is building a PEM electrolyzer with a capacity of 20 MW that will produce green hydrogen from hydropower. Such developments along with projects in the pipeline in Canada would significantly boost market growth in the region.
The Asia Pacific region could witness the highest CAGR during the forecast period, with Australia and Japan being the largest contributors to the regional growth. For example, Toshiba is building an environmentally friendly hydrogen plant with an electrolyzer capacity of 10 MW for the transport sector. In October 2019, Siemens announced a partnership for a combined wind and solar energy project in Australia with an installed capacity of five gigawatts. The company is expected to provide its electrolyzer technology to produce green hydrogen. The gas should be exported to Asian markets.
The study identifies the high capital costs for electrolysers as one of the biggest obstacles to green hydrogen projects. As a conventional technology used in environmentally friendly hydrogen projects, the alkaline electrolyzer had a share of over 2019 percent in 50. Analysts suspect that the PEM electrolyzer segment is likely to record the highest growth rate during the forecast period. The industry is “continuously focused on deploying PEM electrolyzer technology on a commercial scale to make the green hydrogen production process more energy efficient.”
The industry's key players are focused on "technological advances and innovations to minimize the costs of renewable electrolysis and widely commercialize the production of green hydrogen," according to Grand View Research. In addition, companies expanded their market presence with strategic initiatives. In April 2020, Siemens Gas & Power and Uniper SE announced a joint agreement to implement projects for the production and use of green hydrogen from renewable energy sources. The “prominent players in the green hydrogen market” included Linde, Air Liquide, Air Products and Chemicals, Inc., Engie, Green Hydrogen, Hydrogenics, Toshiba Energy Systems & Solutions Corp., among others. and Nel ASA.
The study “Green Hydrogen Market Size, Share & Trends Analysis Report By Technology (PEM Electrolyzer, Alkaline Electrolyzer), By Region (North America, Europe, APAC), And Segment Forecasts, 2020 – 2027” is available from Grand View Research (Link see below).
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Grand View Research: Growing subsidies for the use of clean fuels and investments in the hydrogen economy are strengthening market growth worldwide. / © Andreas Lohse
