Green Hydrogen Market Size, Share, Growth, Trends 2024 To 2033

Green Hydrogen Market Size and Growth 2024 to 2033

The global green hydrogen market size was calculated at USD 6.34 billion in 2023 and is expected to reach around USD 153.78 billion by 2033, growing at a compound annual growth rate (CAGR) of 37.55% from 2024 to 2033.

The green hydrogen market involves the production and distribution of hydrogen generated through renewable energy sources, primarily by water electrolysis using wind, solar, or hydroelectric power. Green hydrogen is considered a clean energy carrier with applications across various industries, including transportation, power generation, and industrial processes. It serves as a sustainable alternative to fossil fuels, contributing to the reduction of carbon emissions and helping meet global climate goals. The market is driven by increasing demand for clean energy, technological advancements, and supportive government policies promoting the transition to a low-carbon economy.

• “According to World Bank blog in 2020, global hydrogen demand was approximately 87 million metric tons (MT), projected to soar to between 500 and 680 million MT by 2050. The hydrogen production market, valued at $130 billion from 2020 to 2021, is forecasted to grow by up to 9.2% annually until 2030. However, the overwhelming majority—over 95%—of current hydrogen production relies on fossil fuels, with only a small fraction being "green." Presently, hydrogen production consumes 6% of global natural gas and 2% of global coal.”
• “The Indian Union Cabinet proposed 'The National Green Hydrogen Mission' to decarbonize the nation through clean energy production. Aimed at global leadership in green hydrogen, the mission targets an annual production capacity of at least 5 million metric tons.
• “The Canadian Prime Minister and Minister of Finance introduced the 'Made in Canada Plan' in the House of Commons, emphasizing clean energy investments in Budget 2023. The plan aims to support the production of clean and green hydrogen within Canada.”

Report Highlights

• Europe has generated highest revenue share of 52% in 2023.
• Asia Pacific has captured second highest revenue share of 23% in 2023. 
• By application, transportation segment has registered 41% revenue share in 2023.
• By application, power generation segment has accounted 36% revenue share in 2023.
• By technology, Polymer Electrolyte Membrane (PEM) Electrolyzer segment has covered revenue share of 26.54% in 2023.

Green Hydrogen Market Growth Factors

• Government Policies and Incentives: Supportive regulations and financial incentives from governments worldwide are accelerating the adoption of green hydrogen as part of broader efforts to combat climate change and reduce carbon emissions. This includes subsidies, grants, and favorable tax policies to encourage investment and development in the green hydrogen sector.
• Technological Advancements: Innovations in electrolyzer technology and renewable energy integration are improving the efficiency and cost-effectiveness of green hydrogen production, making it a more viable alternative to traditional energy sources. Continued research and development are leading to breakthroughs that lower production costs and increase scalability.
• Decarbonization Efforts: Increasing pressure on industries to decarbonize, particularly in sectors like transportation, power generation, and heavy industry, is driving demand for green hydrogen as a clean fuel and feedstock. This transition is essential for meeting global emissions targets and achieving long-term sustainability goals.
• Corporate Sustainability Goals: Many companies are committing to sustainability targets and seeking green hydrogen solutions to reduce their carbon footprints and enhance their environmental credentials. These commitments are part of broader corporate strategies to meet stakeholder expectations and regulatory requirements while fostering innovation.
• Energy Storage and Grid Stability: Green hydrogen offers a promising solution for energy storage and grid stability, addressing the intermittent nature of renewable energy sources and ensuring a reliable energy supply. This capability is crucial for balancing supply and demand, particularly with the increasing integration of solar and wind energy into the grid.

Green Hydrogen Market Trends

• Renewable Energy Integration: The increasing availability and affordability of renewable energy sources like wind, solar, and hydropower are driving the production of green hydrogen. These renewables provide the necessary electricity for water electrolysis, making green hydrogen a more sustainable and attractive option.
• Energy Security: Green hydrogen offers a way to enhance energy security by reducing dependence on imported fossil fuels. Countries can produce hydrogen domestically using their renewable resources, leading to greater energy independence and stability.
• Corporate and Public Investments: Significant investments from both private companies and public institutions are fueling the growth of the green hydrogen market. These investments are directed toward developing infrastructure, advancing technology, and scaling up production capacities.
• Export Potential: Countries with abundant renewable energy resources have the opportunity to become major exporters of green hydrogen. This could create new economic opportunities and trade relationships, particularly for nations looking to leverage their natural advantages.
• Sector Coupling: Green hydrogen enables the coupling of various sectors such as electricity, heating, and transportation. This integration can enhance overall energy efficiency and create new business models, providing opportunities for innovation and economic growth across multiple industries.

Report Scope

Green Hydrogen Market Dynamics

Drivers

Industrial Demand for Clean Alternatives:

• As industries, particularly in sectors like chemicals, steel, and cement, seek to reduce their carbon emissions, the demand for green hydrogen as a clean alternative to traditional fossil fuels and feedstocks is rising. This industrial shift is driven by both regulatory pressures and corporate sustainability goals.

Advancements in Hydrogen Infrastructure:

• The development of hydrogen refueling stations, pipelines, and storage facilities is making green hydrogen more accessible and practical for widespread use. Improved infrastructure supports the adoption of hydrogen in various applications, from transportation to power generation, facilitating market growth.

Restraints

High Production Costs:

• Despite technological advancements, the production of green hydrogen remains relatively expensive compared to traditional fossil fuels and even other forms of hydrogen production. The high costs associated with electrolyzers, renewable energy inputs, and infrastructure development can hinder the competitiveness and widespread adoption of green hydrogen, especially in price-sensitive markets and emerging economies.

Limited Technological Maturity:

• While progress is being made, the technology for green hydrogen production, storage, and transportation is still developing. Issues such as energy efficiency, durability of electrolyzers, and safe, efficient storage solutions need further research and development to achieve the necessary technological maturity for large-scale deployment. This technological gap can slow down commercialization and market expansion efforts.

Opportunities

Cross-Sector Collaboration:

• There is a significant opportunity for cross-sector collaboration between energy producers, technology developers, and end-use industries. By working together, these stakeholders can develop integrated solutions that enhance the efficiency and scalability of green hydrogen production and utilization. Such partnerships can drive innovation, reduce costs, and accelerate market growth.

Decentralized Energy Systems:

• Green hydrogen can play a crucial role in the development of decentralized energy systems, particularly in remote or off-grid areas. These systems can provide reliable and sustainable energy solutions independent of centralized power grids, reducing transmission losses and enhancing energy security. This opportunity is particularly relevant for regions with abundant renewable energy resources.

Challenges

Scaling Up Production:

• One of the major challenges facing the green hydrogen market is scaling up production to meet increasing demand. This involves overcoming logistical challenges in sourcing renewable energy at scale, deploying large electrolyzer capacities, and establishing efficient distribution networks. The complexity and cost of scaling up infrastructure pose significant hurdles.

Regulatory and Policy Uncertainty:

• The regulatory framework surrounding green hydrogen varies widely across regions and countries, leading to uncertainty for investors and developers. Inconsistent policies related to subsidies, carbon pricing, and grid integration can create barriers to market entry and slow down investment in green hydrogen projects. Clear and stable regulatory frameworks are essential to fostering a conducive environment for market growth.

Green Hydrogen Market Segmental Analysis

Technology Analysis

Alkaline Electrolyzer: The Alkaline electrolyzers segment has captured market share of 25.11% in 2023. Alkaline electrolyzers use an alkaline electrolyte solution (typically potassium hydroxide) to split water into hydrogen and oxygen. They are known for their reliability and long operational lifespan. In this market alkaline electrolyzers are seeing trends towards cost reduction through improved materials and manufacturing processes, making them competitive for large-scale industrial applications and renewable energy integration.

Polymer Electrolyte Membrane (PEM) Electrolyzer: The PEM electrolyzer segment has covered market share of 26.54% in 2023. PEM electrolyzers employ a solid polymer electrolyte membrane to facilitate proton exchange during electrolysis. They operate at lower temperatures and pressures compared to alkaline electrolyzers, offering advantages in efficiency and responsiveness to fluctuating electricity inputs. In this market, PEM electrolyzers are trending towards compact designs and enhanced efficiency, catering to applications requiring flexibility and rapid response times.

Others: The others segment has accounted market share of 24.92% in 2023. Other electrolyzer technologies, such as Solid Oxide Electrolysis Cells (SOECs), are also emerging in the green hydrogen market. SOECs operate at high temperatures and can directly convert steam into hydrogen, potentially achieving higher efficiencies and integration with industrial processes. Research focuses on reducing costs, increasing durability, and expanding their applicability in both stationary and mobile hydrogen production systems.

Application Analysis

Power Generation: The power generation segment has registered market share of 36% in 2023. Green hydrogen is increasingly used in power plants to generate electricity through fuel cells, offering a clean energy alternative to fossil fuels. This application is witnessing growth as countries aim to integrate renewable sources more effectively into their energy mix, enhancing grid stability and reducing greenhouse gas emissions.

Transport: The transport segment has garnered market share of 41% in 2023. In transportation, green hydrogen powers fuel cell vehicles, providing zero-emission mobility solutions with fast refueling times. The transport sector is seeing increasing investment in hydrogen infrastructure, particularly for heavy-duty vehicles and fleets, as governments and companies prioritize decarbonization of the transportation sector.

Industry Energy: Used as a clean fuel and feedstock in industries like chemicals, steel, and refineries, green hydrogen reduces carbon emissions in industrial processes. It enables industries to meet stringent environmental regulations and sustainability targets, driving adoption despite initial infrastructure and cost challenges.

Heating: Green hydrogen is utilized in residential and commercial heating systems, offering a renewable alternative to natural gas. This application is gaining traction in regions with established hydrogen infrastructure and supportive policies aimed at reducing carbon emissions from heating.

Others: The others segment has measured market share of 23% in 2023. Green hydrogen finds applications in energy storage, grid stabilization, and as a feedstock for synthetic fuels and chemicals, contributing to overall decarbonization efforts across various sectors. Its versatility and potential for sector coupling make it a promising solution for achieving climate goals while diversifying energy sources.

End Use Analysis

Automotive: Green hydrogen is increasingly used in fuel cells for zero-emission vehicles, offering a sustainable alternative to fossil fuels and addressing concerns over air quality and greenhouse gas emissions. The automotive sector is witnessing growing investments in hydrogen fueling infrastructure and advancements in fuel cell technology to enhance efficiency and range.

Chemical: In the chemical industry, green hydrogen serves as a sustainable feedstock for the production of ammonia, methanol, and other key chemicals. This application reduces the carbon footprint associated with chemical manufacturing processes, aligning with global sustainability goals and driving innovation in hydrogen production technologies.

Petroleum Refinery: Within petroleum refining, green hydrogen plays a crucial role in desulfurization processes and upgrading heavy crude oils. By replacing traditional hydrogen sources derived from fossil fuels, green hydrogen enables refineries to produce cleaner fuels while reducing emissions and complying with stringent environmental regulations.

Power and Energy: Green hydrogen is utilized for energy storage and generation, facilitating the integration of renewable energy sources like wind and solar into the grid. This application addresses the intermittency of renewables by providing a reliable energy storage solution and supports grid stability, making it a key enabler of the transition to a low-carbon energy system.

Industrial: Industries such as metallurgy, electronics, and glass production utilize green hydrogen as a clean energy source for various processes. Its high energy density and versatility make it suitable for replacing fossil fuels in energy-intensive industrial applications, contributing to emissions reduction efforts and enhancing operational sustainability.

Others: Emerging applications of green hydrogen include residential heating and grid balancing services. As technologies advance and costs decline, green hydrogen is expected to find new applications in sectors seeking to decarbonize their operations and reduce reliance on conventional energy sources. These developments are expanding the market's versatility and driving broader adoption across diverse industries.

Green Hydrogen Market Regional Analysis

Why is North America experiencing robust growth in green hydrogen market?

The North America green hydrogen market size is calculated USD 1.40 billion and is projected to grow USD 24.60 billion with a CAGR 41.91% by 2033. In North America, there is a strong emphasis on developing hydrogen infrastructure to support fuel cell vehicles and renewable energy integration. Government initiatives and private investments are driving innovation in electrolyzer technologies and expanding hydrogen production capacities, particularly in the United States and Canada.

Why is Europe dominating in the green hydrogen market? 

Europe green hydrogen market size is estimated at USD 4.53 billion in 2024 and is expected to hit around USD 79.97 billion with a CAGR 40.72% by 2033. Europe leads in green hydrogen adoption, supported by ambitious decarbonization targets and robust policy frameworks. The European Union's hydrogen strategy aims to scale up production capacities and establish a hydrogen economy, with investments in hydrogen production hubs, cross-border transport, and industrial applications.

Asia-Pacific Green Hydrogen Market Trends

Asia-Pacific green hydrogen market size is measured USD 2.01 billion in 2024 and is projected to grow around USD 35.37 with a CAGR 39.42% by 2033. The Asia-Pacific region is investing heavily in green hydrogen to address energy security and reduce dependence on imported fossil fuels. Countries like Japan, South Korea, and Australia are leading the development of hydrogen economies, focusing on renewable energy integration, hydrogen refueling infrastructure, and industrial applications.

LAMEA Green Hydrogen Market Trends

LAMEA countries has generated market share of 9% in 2023. also countries are exploring green hydrogen as a means to diversify their energy mix and capitalize on abundant renewable resources. Initiatives in countries like Chile, Saudi Arabia, and South Africa focus on leveraging solar and wind resources for hydrogen production, supporting local industries, and exporting hydrogen to global markets.

Green Hydrogen Market Top Companies

• Air Liquide
• Linde plc
• Hydrogenics Corporation
• ITM Power
• Nel ASA
• McPhy Energy
• Plug Power
• Ballard Power Systems
• FuelCell Energy
• Siemens Energy
• ENGIE
• Enapter
• Green Hydrogen Systems
• Snam
• Ørsted

New players entering the green hydrogen market are often characterized by their focus on innovation and technology development. Companies like Enapter and Green Hydrogen Systems are adopting novel electrolyzer technologies and modular systems to reduce costs and enhance efficiency. They leverage advancements in renewable energy integration to compete in the rapid growing market. Key players dominating the market include established giants like Air Liquide, Linde plc, and Siemens Energy. These companies possess extensive experience, robust infrastructure, and strong global presence. They lead by investing in large-scale projects, forming strategic partnerships, and influencing regulatory frameworks to shape the industry's growth trajectory.

Recent Developments

• In 2023, Linde plc has announced intentions to expand its green hydrogen production capacity in California, driven by increasing demand from the mobility sector. This initiative aims to meet growing market needs for sustainable hydrogen solutions in transportation and beyond.
• In 2022, Air Liquide S.A., Toyota Motor, and CaetanoBus are collaborating to advance integrated hydrogen solutions, focusing on deploying hydrogen-powered vehicle fleets. Their aim is to accelerate the adoption of hydrogen mobility across both light- and heavy-duty vehicles, alongside infrastructure development.
• In 2022, Siemens Energy and Air Liquide S.A. have formed a joint venture to manufacture industrial-scale renewable hydrogen electrolyzers. This collaboration aims to advance Europe's hydrogen economy, fostering a robust ecosystem for hydrogen technology and electrolysis with a projected capacity of three gigawatts per year by 2025.
• In 2022, WPD and Lhyfe have partnered to produce renewable green hydrogen at the Storgrundet offshore wind farm in Soderhamn, Sweden. This collaboration aims to leverage offshore wind energy to scale up green hydrogen production, supporting sustainable energy initiatives in the region.

Market Segmentation

By Technology

• Alkaline Electrolyzer
• Polymer Electrolyte Membrane (PEM) Electrolyzer 
• Solid Oxide Electrolyzer
• Others

By Application

• Power Generation
• Transport
• Industry Energy
• Heating 
• Others

By End-Use

• Automotive
• Chemical
• Petroleum Refinery
• Power and Energy
• Industrial
• Others

Ny Regions

• North America
• APAC
• Europe
• LAMEA