Green Hydrogen Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2025 - 2032)
This Report Provides In-Depth Analysis of the Green Hydrogen Market Report Prepared by P&S Intelligence, Segmented by Technology (Alkaline Electrolysis, Polymer Electrolyte Membrane (PEM) Electrolysis, Solid-Oxide Electrolyzer Cell), Renewable Energy Source (Solar Energy, Wind Energy), Distribution Channel (Pipeline, Cargo), End User (Residential and Commercial Heating, Industrial, Transportation, Power Generation), and Geographical Outlook for the Period of 2019 to 2032
Explore the market potential with our data-driven report
Green Hydrogen Market Future Prospects
The global green hydrogen market size in 2024 is USD 1.7 billion, and it is expected to advance at a CAGR of 61.5% during 2025–2032, to reach USD 78.3 billion by 2032.
The biggest drivers for the market are the increasing concerns over greenhouse gas emissions due to the rampant industrialization and urbanization around the world. Moreover, the rising number of vehicles on the road worsens the air pollution problem, as does the surging consumption of fossil fuels to generate electricity for a growing population.
Carbon emissions are the primary factor behind the augmentation of the environmental crisis. According to the World Meteorological Organization, the amount of CO2 in the atmosphere has increased by nearly 10% in just two decades, which is a lot quicker than ever witnessed. Hence, there is an increasing focus on diminishing carbon emissions, backed by government policies and the innovations in the renewable energy infrastructure. Heavy investments are being made in the production of green hydrogen and its supply networks.
Renewable energy sources, such as wind and solar, are used to produce green hydrogen through water electrolysis. It serves as a net-zero-emission alternative to the H2 generated from fossil fuels, holding the potential to decarbonize power, generation, transportation, and industry.
Green Hydrogen Market Trends and Growth Drivers
Green Hydrogen Usage in Fuel Cells Is an Expanding Trend
The use of green hydrogen in fuel cells is surging as governments and industries are becoming increasingly conscious of the need to transition to sustainable practices to address the environmental concerns.
With the world speeding up its transition toward renewable energy, hydrogen, especially green hydrogen, has become a key fuel for decarbonizing power generation, transportation, and heavy industries. Green hydrogen, which is manufactured through electrolysis powered by renewable energy, does not release harmful emissions; so, it offers multiple benefits over traditional fossil fuels. It can supply power to microgrids, providing electricity to distant locations and supporting energy independence. India targets energy independence by 2047 and complete decarbonization by 2070, with green hydrogen a key enabler of these goals.
Fuel cells running on green hydrogen promise to be a great alternative to conventional batteries for electric vehicles, offering an extended range and faster refueling. According to the U.S. Department of Energy, in contrast to diesel and gasoline engines, fuel cells directly convert chemical energy to electricity with an approximately 60% efficiency. As per research, fuel cell sales could be worth USD 23,743.4 million by 2030, driven by the green transportation initiatives proliferating around the world.
Green hydrogen is at the center of the clean energy revolution as governments and businesses pour enormous investments into the pursuit of net-zero emissions worldwide. In the near future, as the infrastructure grows and technologies evolve, green hydrogen in fuel cells will play an indispensable role in the energy network.
Government Policies and Investments in H2 Infrastructure Are Major Drivers
Governments across the globe are introducing various schemes and policies, including subsidies, funding for research and innovation, and tax incentives, to encourage the adoption of green hydrogen. Multilateral initiatives, joint investments in research and development projects, and technology sharing are vital to facilitate cross-border hydrogen trade.
The India–Middle East–Europe Corridor (IMEC), announced at the 2023 G20 summit, connects India to Europe via Gulf nations. Leaders from the European Union, India, Saudi Arabia, France, the U.A.E., Germany, Italy, and the U.S. signed the MoU to establish a sustainable hydrogen infrastructure. The IMEC's objective is to build electricity grids and hydrogen pipelines to drive green hydrogen production in India. To support this initiative, the Indian government has approved funding of USD 2.1 billion to produce up to 5 million metric tonnes of the commodity by 2030.
The EU's Hydrogen Strategy and REPowerEU plan have the objective of accelerating the production and import of renewable and low-carbon hydrogen, to reduce emissions and support the transition in energy. The EU has committed to producing and importing 10 million tonnes of renewable hydrogen by 2030, with a target to produce 10% of its energy from renewable hydrogen by mid-century. This idea is to enable its power and transportation industries to achieve carbon-neutrality, as they are the two biggest GHG emitters in the region. The EU has also introduced policies for encouraging renewable hydrogen, providing binding targets, and creating the required infrastructure for an efficient green H2 ecosystem.
High Production Cost Hampers Adoption
The high production cost is a major restraining factor for the adoption of green hydrogen. The production of green hydrogen through electrolysis is costly as it involves the use of renewable energy sources and complex equipment, including electrolyzers. Green hydrogen is consequently less competitive than traditional fuels and other forms of hydrogen, such as gray and black, which are produced from natural gas and coal, respectively, at lower costs. In addition, the unavailability of a large, supportive infrastructure for storage and the inadequate transportation network hold the market from reaching its full potential. Investment in technological advancements, economies of scale, and government support will be vital to overcome these challenges and make the fuel more affordable and commercially accessible.
Green Hydrogen Market Analysis
Technology Analysis
Alkaline electrolysis is the largest category in the market. This is due to its well-established technology and lower capital expenses compared to other kinds of electrolysis. Alkaline electrolyzers also provide long operations, making them suitable for large-scale hydrogen production.
PEM electrolysis is the fastest-growing category in the market. This is because of its high density of over 2 A/cm², swift response to fluctuations in renewable energy inputs, compact system design, and high efficiency. It functions at a lower temperature (20–80 °C) and generates high-purity hydrogen with oxygen as the by-product, making it suitable for multiple purposes.
Solar energy accounts for the larger revenue share, of 55%, in the market. This is owing to the extensive availability, lower cost, and scalability of solar energy for large-scale hydrogen generation through electrolysis. Among all renewable energy technologies, solar is the most extensively deployed, with the IRENA estimating its share at 37% of the global clean energy capacity in 2023.
Wind energy is the fastest-growing category in the market. This is owing to the progress in the wind turbine technology and increase in the number of offshore wind farms. Offshore wind turbines could help produce clean hydrogen by splitting water into hydrogen and oxygen using electricity, at an economical cost. Researchers from the National Renewable Energy Laboratory have found suitable locations along the U.S. Atlantic Coast and the Gulf of Mexico where strong winds and shallow waters provide favorable conditions for the process. This approach aligns with the U.S. DoE's Hydrogen Shot initiative, which aims to reduce clean hydrogen cost to USD 1 per kilogram by 2031, with an initial target of least USD 2 per kilogram.
The renewable energy sources analyzed here are:
Solar Energy (Largest Category)
Wind Energy (Fastest-Growing Category)
Others
Distribution Channel Analysis
Pipelines dominate the market as they are an efficient and affordable method to transfer high volumes of the fuel over long distances, particularly for large-scale industrial operations, such as petroleum refineries and chemical plants. They ensure a steady and reliable supply, which is beneficial for establishing and expanding the hydrogen infrastructure.
Currently, the U.S. has 1,600 miles of hydrogen pipelines. Moreover, as per the World Economic Forum, Oman is leading in the expansion of these pipelines, with plans to lay a 1,000-km line connecting the country’s south to the north.
Hydrogen pipelines are swiftly expanding across Europe too, with nearly 1,600 km presently in place. The 3,300-km SoutH2 Corridor linking Austria, Italy, Germany, and North Africa is expected to meet 40% of the EU’s REPowerEU hydrogen goals. The European Hydrogen Backbone plans to build 11,600 km by 2030 and 40,000 km by 2040 across Europe. Similarly, the Iberian Corridor is planned to transfer 2 million tonnes of green hydrogen, with a commissioning timeframe of 2030.
Cargo is the faster-growing category in the market, with 65% CAGR. With the increasing global hydrogen production, flexibility in international transport solutions is called for. Cargo is particularly advantageous for long-distance shipments to regions where pipeline infrastructure is not established yet. The scale of transportation via tanker ships, trucks, and trains is expanding due to the increasing import of hydrogen by Europe, which has stringent clean energy targets to meet.
The distribution channels evaluated here are:
Pipeline (Larger Category)
Cargo (Faster-Growing Category)
End User Analysis
The industrial category dominates the market. Hydrogen is important for many industrial applications, including steel production, chemical manufacturing, and petroleum refining. In this regard, the market is driven by the rising requirement for clean hydrogen to decarbonize operations. Industries are shifting to low-carbon options, among which green hydrogen can serve as a key feedstock for their applications.
Transportation is the fastest-growing end use for green hydrogen. As the demand for clean energy alternatives accelerates, hydrogen-based automobiles are becoming increasingly popular. It is because hydrogen offers more distance and faster refueling compared to battery electric vehicles, making it a stronger choice for heavy-duty and long-range transportation. In its endeavor to go electric, Hyundai Motor Company has announced an investment of USD 1.1 billion till 2032 to manufacture FCEVs in Brazil.
The end uses analyzed here are:
Residential and Commercial Heating
Industrial (Largest Category)
Transportation (Fastest-Growing Category)
Power Generation
Others
Drive strategic growth with comprehensive market analysis
Green Hydrogen Market Geographical Outlook
Europe is the largest region in the green hydrogen market, with a share of 45% in 2024. Europe dominates in hydrogen infrastructure development, production, and policy support, propelled by climate goals, primarily the target to achieve carbon neutrality by 2050. The EU’s Hydrogen strategy, REPowerEU, and Hydrogen Backbone drive efforts to scale up production, build pipelines, and share technology.
The Asia-Pacific region is the fastest-growing in the market, with an expected CAGR of 64% over this decade. This region is experiencing a major investment in hydrogen production with Japan, South Korea, India, and China setting certain goals for hydrogen adoption. The market growth is also owed to the rising demand for clean energy and the favorable government policies for green H2 production and supply infrastructure development.
The National Green Hydrogen Mission aims to position India as a world leader in green hydrogen production. By 2030, it seeks to achieve an annual output of 5 million metric tonnes, a renewable capacity of 125 GW, INR 8 lakh crore in investments, and 600,000 jobs, while saving INR 1 lakh crore worth of imports and 50 mmt of annual emissions.
The geographical breakdown of the market is as follows:
Brazil (Largest and Fastest-Growing Country Market)
Mexico
Rest of LATAM
Middle East and Africa (MEA)
South Africa
Saudi Arabia (Largest and Fastest-Growing Country Market)
U.A.E.
Rest of MEA
Green Hydrogen Market Share
The market is fragmented owing to the nascent nature of technology, regional disparities in production, and diverse policy frameworks. Due to the high cost of production and a relatively poor infrastructure, small players hold ample shares the market and aim more at localized solutions. Further fragmenting the market are the coherent hydrogen strategy of Europe and the significant investments in hydrogen technology in Asia-Pacific.
In addition, the presence of different end uses, such as transportation, power, and industries, leads to the emergence of niche players, who provide focused solutions for each. This fragmentation evidences a developing yet rather imbalanced market with numerous opportunities, as technologies mature and global demand grows.
Major Companies in Green Hydrogen Market:
Toshiba Energy Systems & Solutions Corporation
L�Air Liquide SA
Nel ASA
Air Products Inc.
Green Hydrogen Systems
Engie SA
Linde plc
H&R ?lwerke Schindler GmbH
Messer Group
BP plc
Shell plc
Plug Power Inc.
Green Hydrogen Market News
In September 2024, Jindal Steel and Jindal Renewables entered into a collaboration to generate green hydrogen for low-emission steelmaking in Angul, Odisha. The project, scheduled to begin in December 2025, will produce 4,500 tonnes annually and supply renewable energy, aiming at a reduction in coal dependence by 50%.
In June 2024, Air Products Inc. and TotalEnergies SE signed a 15-year agreement to supply 70,000 tonnes of green hydrogen annually by 2030, to decarbonize European refineries and cut CO₂ emissions by 700,000 tonnes per year.
In May 2024, Oman’s Hydrom signed USD 11 billion worth of green hydrogen agreements with Electricité de France (EDF Group), Actis, and Fortescue to build two green hydrogen plants. It is aiming for 1.38 million tonnes of annual production by 2030. The plants will produce 178,000 tonnes using 4.5 GW of renewable energy and a 2.5-GW electrolyzer.
Frequently Asked Questions About This Report
What will be the size of the green hydrogen market in 2032?+
The size of the market for green hydrogen will be USD 78.3 billion in 2032.
What are the factors driving the green hydrogen industry?+
Government policies and investments are major factors driving the green hydrogen industry.
Which is the largest distribution channel in the green hydrogen market?+
Pipelines are the largest distribution channel in the market for green hydrogen.
Which region generates the highest green hydrogen industry revenue?+
Europe generates the highest revenue green hydrogen industry.
Which is the largest end user in the green hydrogen market?+
The industrial sector is the largest end user in the market for green hydrogen.
Leading companies across industries trust us to deliver data-driven insights and innovative solutions for their most critical decisions. From data-driven strategies to actionable insights, we empower the decision-makers who shape industries and define the future. From Fortune 500 companies to innovative startups, we are proud to partner with organisations that drive progress in their industries.
Client Testimonials
Working with P&S Intelligence and their team was an absolute pleasure – their awareness of timelines and commitment to value greatly contributed to our project's success. Eagerly anticipating future collaborations.
McKinsey & Company
India
Unmatched Standards
Our insights into the minutest levels of the markets, including the latest trends and competitive landscape, give you all the answers you need to take your business to new heights
Complete Data Security
We take a cautious approach to protecting your personal and confidential information. Trust is the strongest bond that connects us and our clients, and trust we build by complying with all international and domestic data protection and privacy laws