What Has Been the Progress and Growth of the Water Electrolysis Market in Recent Years?
The water electrolysis market has seen considerable growth due to a variety of factors.
• In the past few years, the water electrolysis market has seen robust growth. Its size, which is expected to increase from $7.81 billion in 2024 to $8.59 billion in 2025, signals a compound annual growth rate (CAGR) of 10.0%.
This growth during the historic period is linked to heightened environmental awareness, the utilisation of hydrogen in sustainable farming methods, the rising demand for hydrogen in industrial processes, the development and enlargement of water electrolysis facilities, and the growing acknowledgement of the advantages of hydrogen.
What are the Forecasted Growth and Key Factors of the Water Electrolysis Market?
The water electrolysis market is expected to maintain its strong growth trajectory in upcoming years.
• Anticipations are high for the water electrolysis market as it is predicted to witness substantial growth in the coming years. With a projected Compound Annual Growth Rate (CAGR) of 9.7%, the market size is expected to reach $12.44 billion by 2029. Factors contributing to this buoyant projection include an increasing demand for eco-friendly hydrogen, government-backed policies and subsidies, growth of renewable energy sources, investments into hydrogen infrastructure and the reducing costs associated with electrolyzers. Trends that are expected to characterize the forecast period involve progress in electrolyzer materials, the application of power-to-x technologies, the evolution of hybrid systems, increases in automation and control systems, and integration with carbon capture technologies.
What Key Factors and Trends are Driving the Growth of the Water Electrolysis Market?
The surging need for hydrogen production is set to drive the expansion of the water electrolysis market in the future. Hydrogen production involves creating hydrogen gas through various techniques like electrolysis, steam methane reforming, and biomass gasification. The drive for hydrogen production is fueled by the increasing worldwide focus on minimizing carbon emissions and shifting towards more environmentally friendly energy sources. Hydrogen fuel is generated in a clean and sustainable manner through water electrolysis, which employs electricity to separate water into its constituent elements, hydrogen and oxygen, especially when renewable energy sources power it. For example, data from the International Energy Agency, a France-based intergovernmental group, in July 2023 showed that low-emission hydrogen production constituted less than 1% of total hydrogen production in 2022, even with a 5% increase from 2021, indicating a steady move towards cleaner hydrogen production. Consequently, the escalating need for hydrogen production is influencing the growth of the water electrolysis market.
How Is the Water Electrolysis Market segmented?
The water electrolysis market covered in this report is segmented –
1) By Product Type: Alkaline Electrolyzer, Proton Exchange Membrane (PEM) Electrolyzer, Solid Oxide Electrolyzer Cell (SOEC), Anion Exchange Membrane (AEM) Electrolyzer
2) By Input Power: Below 2 kW, 2 kW - 5 kW, Above 5 kW
3) By Hydrogen Production: Below 500 L/hr, 500 – 2000 L/hr, Above 2000 L/hr
4) By End-User Applications: Ammonia Production, Methanol Production, Refining Industry, Power and Energy Storage, Transportation Or Mobility Industry, Other End User Applications
Subsegments:
1) Alkaline Electrolyzer: Liquid Alkaline Electrolyzers, Pressurized Alkaline Electrolyzers, High-Temperature Alkaline Electrolyzers
2) Proton Exchange Membrane (PEM) Electrolyzer: Low-Temperature PEM Electrolyzers, High-Temperature PEM Electrolyzers, Compact PEM Electrolyzers
3) Solid Oxide Electrolyzer Cell (SOEC): Intermediate Temperature SOEC, High-Temperature SOEC, SOEC with Integrated Heat Recovery
4) Anion Exchange Membrane (AEM) Electrolyzer: AEM Electrolyzers for Water Splitting, High-Performance AEM Electrolyzers, AEM Electrolyzers with Improved Durability
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What New Trends Are Influencing the Water Electrolysis
Significant businesses that occupy the water electrolysis market are moving towards creating innovative solutions, such as proton exchange membrane (PEM) water electrolyzers, aiming to increase the efficiency of hydrogen production and minimize energy usage. The technology behind proton exchange membrane (PEM) water electrolyzers involves a solid polymer electrolyte that separates water into hydrogen and oxygen through an electrochemical procedure, providing an efficient and versatile method for hydrogen production. In March 2024, Sungrow Power Supply Co. Ltd, a manufacturer from China, unveiled the 300Nm³/h PEM Water Electrolyzer. This particular electrolyzer, capable of producing 300Nm³ of hydrogen every hour with superior efficiency, requires less than 4.15kWh/Nm³ of energy. It's engineered for adaptable hydrogen production with renewable energy sources in mind, guaranteeing the best performance in varying conditions.
Who Are the Key Players in the Water Electrolysis Market?
Major companies operating in the water electrolysis market are include:
• Robert Bosch GmbH
• ThyssenKrupp AG
• Siemens Energy AG
• Linde AG
• Toshiba Energy Systems & Solutions Corporation
• Cummins Inc.
• Sungrow Power Supply Co. Ltd.
• LONGi Green Energy Technology Co. Ltd.
• Plug Power Inc.
• KTH Royal Institute of Technology
• Sunfire GmbH.
• Nel ASA.
• Ohmium International Inc.
• Shandong AUYAN New Energy Technology Co. Ltd.
• HydrogenPro ASA
• Ceres Power Holdings plc
• McPhy Energy SA.
• Horizon Fuel Cell Technologies Pte Ltd
• ITM Power PLC.
• Giner ELX Inc.
• SES Hydrogen
• Enapter AG
• Elogen SAS
• Next Hydrogen Solutions Inc.
• CAPLINQ Corporation
• GreenH Electrolysis
What Is The Most Dominant Region In The Water Electrolysis Market?
Europe was the largest region in the water electrolysis market in 2024. North America is expected to be the fastest-growing region in the forecast period. The regions covered in the water electrolysis market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
