It is well to be noted that clean hydrogen happens to be a pivotal player in the shift to sustainable energy and gets generated by way of processes such as electrolysis using sources of renewables. Unlike traditional hydrogen production processes, clean hydrogen production goes out to give minimal or zero carbon emissions, thereby positioning it as a major solution in terms of decarbonizing numerous sectors. As governments along with industries commit to ambitious climate goals across the world, clean hydrogen has gone on to gain enough prominence when it comes to fostering a green economy, as its flexibility spans applications when it comes to transportation, industry, as well as energy storage, making it very crucial in the low-carbon future endeavour. With ongoing advancements as well as investments taking place, the clean hydrogen sector is all set to play a transformative role when it comes to mitigating climate change and also pushing for a more sustainable energy backdrop. Notably, the clean hydrogen market happened to be valued at $3.8 billion in 2022 and is all set to reach $18.3 billion by 2032, thereby growing at a CAGR of 14.8% right from 2023 to 2032.
Clean hydrogen happens to be a form of hydrogen that is generated by way of processes that result in lower carbon emissions. Climate change along with net-zero commitments happen to be the major causes of the shift from fossil fuels to certain choices like synthetic fuels, nuclear fusion energy, renewables, clean hydrogen, etc.
It is worth noting that hydrogen is not a direct substitute when it comes to coal, oil, and natural gas but can also help to decarbonize parts of the economy. Clean hydrogen is all set to be a major contributor to the clean energy economy. The fact is that the net-zero targets to bring down the temperature rise from 2 degrees Celsius to 1.5 degrees Celsius are indeed fueling the progress in alternative fuels.
The desire to bring down carbon footprints by way of energy shift by reducing primary energy dependence on fossil fuels as well as non-renewable sources has been a prominent driver in terms of clean hydrogen market growth. Besides, lower-to-zero carbon-emitting fuels happen to be sought for decreasing the carbon footprint, which also goes on to add to market growth.
But the higher cost as well as the volatile nature of the product go on to restrain market progress for clean hydrogen. Apart from this, the lack of policy frameworks as well as the intricate value chain of the product goes on to discourage the clean hydrogen sector growth. The government policy and company strategies, meanwhile, are all set to offer lucrative opportunities for market growth. Clean hydrogen production can be done by way of electrolyzers as well as carbon capture technologies.
Interestingly, the size of the clean hydrogen market happens to be studied based on type, method, application, as well as region. When we consider by type, the clean hydrogen market gets bifurcated into blue and green hydrogen. Notably, blue hydrogen dominated the clean hydrogen market share in 2022, is a relatively fresh concept, and can be called hydrogen made either by way of steam methane reforming or natural gas.
The fact is that blue hydrogen production happens to be less costly vis-Ã -vis green hydrogen as the electricity source when it comes to green hydrogen cannot be entirely renewable in many instances. But green hydrogen is anticipated to grow at a significant rate all across the projection years. The development of new green hydrogen plants bent toward the decarbonizing economy and the development of new efficient technologies go on to push market growth for clean hydrogen.
When it comes to the method, the market is classified further into electrolysis and carbon capture. The electrolysis segment gets further divided into alkaline electrolyzers, polymer electrolyte membrane electrolyzers- PEM, as well as solid oxide electrolyzers- SOE. The carbon capture segment went on to dominate the market share and is all set to grow at a higher CAGR throughout the clean hydrogen market forecast period. This is due to the fact that CCUS technology is much cheaper as compared to electrolyzers, as the installation and maintenance costs for electrolyzers happen to be pretty high.
In terms of application, the market gets further divided into industrial, transportation, and power, as well as others. The industrial segment gained the highest market share for 2021, which was closely followed by the transportation segment and is anticipated to grow at a higher CAGR throughout the projection period. Hydrogen is used throughout numerous industrial processes in the metallurgy, glass, chemical feedstock, and food & beverages sectors and thereby acts as a throttle for the industrial segment.
But the transportation segment is anticipated to follow the industrial segment across the projection period as decreasing the carbon footprint by way of synthetic fuels as well as electric vehicles pushes hydrogen demand, which goes on to add more to the already rising demand for clean hydrogen.
In terms of region, the clean hydrogen market evaluation gets done throughout the regions of North America, Europe, Asia-Pacific, Latin America, the Middle East, and Africa. Apparently, North America went on to dominate the clean hydrogen market share for 2021, and it is expected that the same will grow at a higher CAGR all across the forecast period. This is due to the many clean hydrogen projects that are being planned and put into practice across countries such as the U.S. and Canada.
It is a well-versed fact that Asia-Pacific happens to be a big consumer of electric vehicles, which goes on to drive the demand for hydrogen fuel cells. Apparently, China went on to dominate the world hydrogen market as its largest producer as well as consumer. The country goes on to consume almost 24 million tons of hydrogen per year. Notably, in 2017, Japan became the very first country to put into place a national hydrogen strategy as part of its objective to become the world’s first hydrogen society by way of adopting this fuel throughout all sectors.
