Hydrogen Generation Market Size, Share & COVID-19 Impact 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, 2021-2028

The global hydrogen generation market size was USD 145.67 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with hydrogen generation witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market exhibited a lower growth of about 2.4% in 2020 as compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 150.20 billion in 2021 to USD 220.37 billion in 2028 at a CAGR of 5.6% in the 2021-2028 period. The sudden rise in CAGR during the forecast period is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

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.

Disruptions in Supply Chains to Intermittently Halt the Technology Demand amid COVID-19 Pandemic

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 have 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.

LATEST TRENDS

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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.

DRIVING 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.

Shift towards Clean Energy Power to Aid Expansion

Continuous industrial and urban expansions have propelled countries to adopt different power generation methods to comply with the demand. Also, rapidly growing population and development initiatives across regions such as the Asia Pacific and the Middle East & Africa. Increasing concerns over sustainable energy usage to reduce dependability on fossil fuels such as crude oil & natural gas play a vital role in the global market. For instance, as per the BP Statistical Review of World Energy 2020 published in June 2020, the total energy consumption across the Asia Pacific equaled about 257.6 exajoules in 2019, growing from around 249.4 exajoules in 2018.

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.

SEGMENTATION

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 valued at USD 50.27 billion in 2020 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.

KEY INDUSTRY PLAYERS

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:

• In July 2021, Cerulean Winds, in partnership with px Group announced a contract to assist onshore green hydrogen plants and related industrial infrastructure in England and Scotland for its 200-turbine floating wind-to-hydrogen project based in the North Sea. According to the contract, px Group will operate the hydrogen generation facilities and the related onshore infrastructure with the grid connections and onshore substations.


• In July 2021, Plug Power, one of the leading hydrogen technology companies with Apex Clean Energy step into a 345 MW wind power purchase agreement (PPA). The project is believed to be the largest wind-powered hydrogen project in the U.S., and the energy generated from the wind farm will power one of a series of liquid hydrogen plants. Plug Power predicted demand would exceed 100 tons of hydrogen per day by 2025, generating a need to produce hydrogen generation capacity. 


• In July 2021, Siemens Smart Infrastructure announced a contract for the construction of a hydrogen generation plant in Wunsiedel, Germany, with a capacity of 8.75 megawatts. The facility, once operational in 2022, is expected to generate up to 1,350 tons of hydrogen per year by renewable energy sources.


• In April 2021, Loop Energy, in partnership with BayoTech declared a shared market development agreement for the deployment of hydrogen fueling infrastructure and hydrogen vehicles. According to the agreement, Loop and BayoTech will work on the market development for the deployment of vehicles produced by Loop with on-site hydrogen generation infrastructure given by BayoTech.

REPORT COVERAGE

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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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