Electrolyzer Market

Electrolyzer Market Outlook for 2024 to 2034

The global electrolyzer market is expected to reach USD 42.4 billion by 2034, up from USD 4.7 billion in 2024. The market is anticipated to expand between 2024 and 2034 at a noteworthy compound annual growth rate of 24.6%. The increased focus on green hydrogen generation for renewable energy applications and global decarbonization initiatives drives up demand for electrolyzers.

The increasing attention paid to green hydrogen as a renewable energy source is driving the adoption of electrolyzers. The objective of reducing carbon emissions and promoting renewable energy is driving investments in electrolysis technology by governments and industries globally.

Because they are essential to creating green hydrogen, electrolyzers are becoming more widely used as we move toward low-carbon, sustainable energy systems.

Attributes	Details
Electrolyzer Market Value for 2024	USD 4.7 billion
Electrolyzer Market Size for 2034	USD 42.4 billion
Market Forecast CAGR for 2024 to 2034	24.6%

Consumption Analysis of the Electrolyzer Sector

• The growing curiosity in green hydrogen generation, in which electrolyzers play an important part, is a crucial driver of the electrolyzer market's growth.
• The development of electrolyzer technologies is fueled by the growing utilization of renewable power sources, such as solar and wind power, which offer a plentiful and sustainable supply of electricity for electrolysis.
• The market's growth is influenced by ongoing developments in electrolyzer technology, such as increased cost-effectiveness, scalability, and efficiency.
• Electrolyzers have new prospects due to the move toward decentralized energy systems and off-grid uses, especially in distant locations and energy-dependent sectors.
• Demand for electrolyzers is driven by the growing awareness of hydrogen as a flexible and sustainable energy source for various applications, including industrial operations and transportation.

Historical Performance and Future Growth of the Electrolyzer Market

The current section provides a thorough analysis of the industry during the previous five years, emphasizing the anticipated trends in the electrolyzer market. With a robust historical compound annual growth rate of 27.9%, the market is gradually becoming more constrictive. Up to 2034, the industry is expected to grow consistently at 24.6%.

Historical CAGR	27.9%
Forecast CAGR	24.6%

The global electrolyzer industry's growth may need to be improved by elements including technological difficulties, heightened expenditures, and scarce industry infrastructure.

Crucial factors that are anticipated to hamper the demand for electrolyzers through 2034.

• Electrolyzer technology's high upfront and recurring costs might prevent widespread adoption and negatively impact the market for electrolyzers.
• The expansion of electrolyzer applications and the impact on demand might be aided by additional infrastructure, such as hydrogen storage and delivery facilities.
• Hydrogen storage technical obstacles, such as storage capacity and safety issues, might restrict the utilization of electrolyzers.
• Supply chain disruptions or bottlenecks, such as the scarcity of essential components or materials, may hamper the development of the electrolyzer sector.

During the predicted duration, market participants are going to need to be astute and adaptive, as these challenging characteristics set the sector up for future achievement.

Key Trends Influencing the Electrolyzer Market

Green Hydrogen Emphasis Skyrockets in the Global Electrolyzer Sector

The need for electrolyzers, a key component of the hydrogen generation process, is increasing due largely to the increased emphasis on environmentally friendly hydrogen production.

Electrolyzers are essential to this shift because they split water into hydrogen and oxygen. Because of the pressing need to decarbonize sectors and meet ambitious climate targets, governments and businesses globally are spending progressively more on electrolyzer projects.

A robust market need for competent and versatile electrolyzer technology has been created to support the expansion of the hydrogen economy since this focus on green hydrogen is in line with global efforts to minimize carbon emissions, apparently developing the electrolyzer industry.

Development of the Global Hydrogen Economy

Significant investments in electrolyzer projects are being driven by the increasing understanding of hydrogen's importance in the shift to a low-carbon economy. There is growing recognition of hydrogen as a flexible and sustainable energy source that may help with decarbonization issues in many different industries.

Green hydrogen generated by electrolysis and driven by renewable energy sources emerges as a critical alternative as countries and companies commit to aggressive carbon reduction targets. Governments, businesses, and investors are allocating large sums of money to electrolyzer projects to boost the generation of green hydrogen.

Electrolyzers are strategically positioned as a technology that is anticipated to drive innovation and deployment to assist the global move toward a more environmentally friendly and sustainable energy landscape, thanks to the potential applications of hydrogen in industries, transportation, and energy storage.

Increased Integration of Renewable Energy

The electrolyzer market's growth is attributed primarily to the increasing use of renewable power sources to power electrolyzers. This development is consistent with the general move toward environmentally friendly hydrogen production techniques.

Electrolyzers, powered by renewable energy, facilitate the production of green hydrogen through water electrolysis, generating hydrogen without carbon emissions. As the world intensifies efforts to transition toward cleaner energy and reduce reliance on fossil fuels, the coupling of electrolyzers with renewable sources gains significance.

The market for electrolyzers, a key component of the renewable energy transition, is supported by governments, businesses, and investors. These investors are investing increasingly in electrolyzer projects that take advantage of sustainability, propelling the growth of green hydrogen production.

Category-wise Insights

This section offers in-depth analyses of particular electrolyzer market sectors. The PEM electrolyzer sector and the ≤ 500 kW capacity segment are the two main topics of the research.

Polymer Electrolyte Membrane (PEM) Electrolyzer Rises in the Electrolyzer Industry

Attributes	Details
Top Type	PEM Electrolyzer
CAGR from 2024 to 2034	24.3%

The PEM electrolyzers are widely preferred in the electrolyzer industry from 2024 to 2034, with a notable compound annual growth rate (CAGR) of 24.3%. This is a decrease from the prior CAGR of the polymer electrolyte membrane (PEM) electrolyzer type, which was 27.5% from 2019 to 2024. The following drivers describe the development of the PEM electrolyzer component segment:

• In polymer electrolyte membrane (PEM) electrolyzers, simple recycling procedures for catalyst-coated membranes are becoming more popular. Higher yields of hydrogen and oxygen may be recovered using ultrasonication techniques without producing dangerous gas emissions.
• Proton exchange membrane (PEM) electrolyzer efficiency is consistently being researched and developed to maximize the device's potential for producing hydrogen.
• Advancements in PEM electrolyzer technology, which overcome scalability issues, make developing both small- and large-scale electrolysis systems to satisfy market demands possible.
• PEM electrolyzers are designed to fulfill strict quality standards and provide high-purity hydrogen appropriate for miscellaneous industrial applications.

Electrolyzer Industry Calibrates Devices below 500 kW

Attributes	Details
Top Capacity	≤ 500 kW
CAGR from 2024 to 2034	24.0%

The capacity below 500 kW segment is expected to dominate the electrolyzer market, exhibiting a significant CAGR of 24.0% between 2024 and 2034. However, it is noteworthy that the CAGR for below 500 kW electrolyzers capacity was previously projected to be a remarkable 27.3%. The development of ≤ 500 kW capacity for electrolyzers can be attributed to several factors:

• The global market is seeing a rise in the use of ≤ 500 kW electrolyzers in various sectors and applications.
• Continuous technical progress aims to enhance the efficacy, dependability, and affordability of electrolyzers with a power output below 500 kW, rendering them more appealing for small- to medium-sized hydrogen generation.
• The flexibility of ≤ 500 kW electrolyzers may be increased by expanding them according to demand and integrating them easily into existing systems because of the design's emphasis on modularity and scalability.
• Electrolyzers can aid green hydrogen generation with a capacity of < 500 kW thanks to increased integration with renewable energy sources.

Country-wise Insights

The United States, China, Japan, South Korea, and the United Kingdom are some of the predominant countries, and this section anticipates looking at their electrolyzer sectors. Examine the several aspects influencing these nations' need for, acceptance of, and interactions with electrolyzers via a thorough investigation.

Country	CAGR from 2024 to 2034
United States	25.0%
Japan	25.9%
United Kingdom	26.2%
South Korea	26.9%
China	23.8%

The United States Upsurges the Demand for the Hydrogen Electrolyzer

The electrolyzer industry in the United States is expected to witness steady growth of 25.0% until 2034. This growth rate is lower compared to the 28.7% observed between 2019 and 2023. Despite the moderate growth, the industry is projected to reach a valuation of USD 7.6 billion by 2034. The following factors are driving the demand for electrolyzers, which is likely to play a crucial role in the growth of the industry:

• Demand in the United States is expected to be driven by the growing number of secondary end-user industries and the increased use of hydrogen in refinery hydro-processing in recent years.
• The need for hydrogen in ultra-low sulfur diesel fuel in the United States has increased in the forthcoming decade.
• The need for hydrogen electrolyzers has increased due to the growing need for eco-friendly energy sources, which has contributed to the growth of the market in the United States.

The United Kingdom Soaring the Electrolyzer Expansion in the Automobile Sector

The demand for electrolyzers in the United Kingdom is expected to witness substantial growth in the coming years, with an estimated CAGR of 26.2% until 2034. The industry has already shown significant potential, with a CAGR of 31.7% between 2019 and 2023. The market is estimated to be valued at USD 1.7 billion, indicating a vast potential for growth and investment in this sector. Here are a few of the trends:

• The United Kingdom is expected to dominate the global market in the forecast period due to its significant share in the automobile sector and power plant infrastructure.
• Significant revenues were attributed to the growth of investment businesses and the existence of prominent market participants in the United Kingdom.
• The developing electronic industry and the increasing need for clean energy are expected to be the main drivers for a significant share.

Technological Advancements Powering the Market of Electrolyzer in China

The electrolyzer market in China is witnessing a significant surge in demand at a predicted CAGR of 23.8%. Experts anticipate the sector to reach a valuation of USD 6 billion by the year 2034. The industry is expected to experience a significant CAGR of 25.9% between 2019 and 2023. Among the main trends are:

• China's dedication to hydrogen as a vital component of its energy transition fuels its explosive rise in the electrolyzer market.
• Technological advancements in electrolyzer systems that increase efficiency and lower costs result from ongoing research and development efforts.
• A greater emphasis is being placed on large-scale electrolyzer projects, such as gigawatt-scale facilities, demonstrating China's goal of becoming a leader in hydrogen generation.

Urbanization in the Power Alternatives Hit the Roof in Japan

The demand for electrolyzers in Japan is soaring dramatically; the industry is anticipated to grow at a rate of 25.9% through 2034 and is estimated to reach USD 4.7 billion by the end of 2034. It is noteworthy that the industry's prior compound annual growth rate was around 31.3%. Among the main motivators are:

• Urbanization trends necessitate sustainable energy solutions in densely populated areas, with renewable resources like solar and wind being utilized more in line with Japan's commitment to green energy.
• The increasing electricity demand necessitates the development of efficient electrolyzers, which are crucial in meeting the demand for hydrogen, a versatile energy carrier.
• Japan is prioritizing the use of power alternatives, including hydrogen, as part of its energy transition strategy to decrease dependence on traditional fuels.

South Korean Electrolyzer Demand Upsurges in Forthcoming Decade

The market for electrolyzers in South Korea is predicted to rise significantly with a potential CAGR of 26.9%; by 2034, this growth is anticipated to translate into a valuation of USD 2.7 billion. Here are a few of the key trends:

• The emphasis on renewable energy and the implementation of carbon reduction policies drive the electrolyzer market's overall rise in South Korea.
• Expanding financial inflows into South Korea's public and private domains suggests a cooperative endeavor to propel electrolyzer technology forward.
• The market in South Korea has expanded recently, indicative of a dynamic trend toward greener energy options.
• The South Korea market is vying to become a leading force in the green technology space by joining the movement toward greener energy sources.

Establishments Shaping the Outlook of the Electrolyzer Industry

The global electrolyzer industry is witnessing a transformational shift as establishments leverage strategic initiatives and innovations to shape the future viewpoint.

Research and development centers within aerospace companies are pioneering materials, manufacturing processes, and aerodynamics advancements. Collaborative partnerships between industry players, academia, and government entities foster a dynamic ecosystem, accelerating technological breakthroughs.

Siemens Energy, ITM Power, and Ballard Power Systems shape the electrolyzer industry with distinct expertise. Siemens Energy actively advances electrolyzer technologies, focusing on enhancing efficiency and scalability. ITM Power leads large-scale electrolyzer projects, specializing in developing green hydrogen initiatives.

Ballard Power Systems' specialization in proton exchange membrane (PEM) fuel cell technology closely aligns with electrolyzers, impacting hydrogen production advancements. Together, their collective impact drives innovation, efficiency, and scalability in electrolyzer solutions, crucial in the electrolyzer industry's evolution toward widespread adoption and the transition to green hydrogen production.

Combined, these industry players shape the overall picture for the global electrolyzer market by promoting innovation, development, and technical improvements in the forthcoming decade.

Recent Developments in the Electrolyzer Industry:

• In January 2024, BASF secured funding for a 54 MW proton exchange membrane electrolyzer, which is anticipated to produce up to 8,000 metric tons of hydrogen annually, with the German Federal Ministry for Economic Affairs and Climate Action approving up to USD 143 million.
• In January 2024, Reliance Electrolyzer Manufacturing, John Cockerill Green Hydrogen Solutions, Jindal India, and Adani New Industries applied for SECI's tender to develop 1.5 GW of electrolyzer manufacturing units in India.
• In January 2024, Enapter AG formed a joint venture with Wolong Electric Group Co., Ltd to acquire stacks from the Enapter Group and produce Enapter AEM electrolyzer products in China.
• In December 2023, McPhy Energy secured a significant contract with HMS Oil and Gas division GmbH, supplying and commissioning four McLyzer 3200-30 electrolyzers with a 64 MW cumulative capacity.

Key Companies in the Electrolyzer Market

• Nel Hydrogen (Norway)
• Asahi Kasei (Japan)
• Hydrogenics (Canada)
• Shandong Saikesaisi Hydrogen Energy Co., Ltd. (China)
• Teledyne Energy Systems (United States)
• Siemens Energy (Germany)
• Kobelco Eco-Solutions (United States)
• ITM Power (United Kingdom)
• Ballard Power Systems (Canada)
• McPhy Energy (France)
• Plug Power (United States)
• ABB (Switzerland)
• De Nora (Italy)
• Green Hydrogen Systems (Denmark)

Table of Content

• 1. Executive Summary
• 2. Market Overview
• 3. Market Background
• 4. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034
• 5. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Type
  • 5.1. PEM Electrolyzer
  • 5.2. Alkaline Electrolyzer
  • 5.3. Solid Oxide Electrolyzer
• 6. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Capacity
  • 6.1. ≤ 500 kW
  • 6.2. 500 kW - 2 MW
  • 6.3. Above 2 MW
• 7. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Application
  • 7.1. Steel plant
  • 7.2. Power plants
  • 7.3. Electronics and photovoltaics
  • 7.4. Energy storage for fuel cells
  • 7.5. Industrial gases
  • 7.6. Power to gas
  • 7.7. Others
• 8. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Region
  • 8.1. North America
  • 8.2. Latin America
  • 8.3. Western Europe
  • 8.4. Eastern Europe
  • 8.5. South Asia and Pacific
  • 8.6. East Asia
  • 8.7. Middle East and Africa
• 9. North America Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 10. Latin America Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 11. Western Europe Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 12. Eastern Europe Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 13. South Asia and Pacific Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 14. East Asia Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 15. Middle East and Africa Market Analysis 2019 to 2023 and Forecast 2024 to 2034, By Country
• 16. Key Countries Market Analysis
• 17. Market Structure Analysis
• 18. Competition Analysis
  • 18.1. Nel Hydrogen (Norway)
  • 18.2. Asahi Kasei (Japan)
  • 18.3. Hydrogenics (Canada)
  • 18.4. Shandong Saikesaisi Hydrogen Energy Co., Ltd. (China)
  • 18.5. Teledyne Energy Systems (USA)
  • 18.6. Siemens (Germany)
  • 18.7. Kobelco Eco-Solutions (USA)
  • 18.8. Green Hydrogen Systems (Denmark)
  • 18.9. Next Hydrogen (Canada)
  • 18.10. H-Tec Systems (Germany)
• 19. Assumptions & Acronyms Used
• 20. Research Methodology