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Hydrogen Generation Market Overview
The key trend identified in the global hydrogen generation market is the growing investments in the research and development (R&D) of hydrogen production technologies. As per World Energy Outlook 2018 by the International Energy Agency (IEA), investments in water electrolyzers for the production of hydrogen have increased considerably in recent years. The investments in water electrolysis products for clean energy applications stood around $17.0 million in 2017 and are expected to increase to $40.0 million by 2020.
Hydrogen is a chemical molecule that is non-metallic, colorless, non-toxic, odorless, and highly combustible in nature. It is commonly produced by processing syngas, which is a mixture of carbon monoxide and hydrogen. Additionally, it can be produced through the electrolysis of water, an environment-compatible process. Hydrogen can be stored in various forms, such as gaseous, liquid, and metal hydride. Besides, it demonstrates high energy efficiency and low boiling point and can be easily transported; these qualities make it ideal for use in industrial applications. The hydrogen generation market in the report is segmented on the basis of production and delivery mode, technology, application, and geography.
On the basis of production and delivery, the hydrogen generation market is bifurcated into captive and merchant modes. In the merchant delivery mode, the merchant supplies hydrogen to small and medium industries. The category held a significant share in the market during historical period owing to the increased consumption of the gas in small and medium industries. Moreover, the market is expected to witness considerable growth in captive generation during forecast period, owing to the increasing on-site production to meet the growing demand for hydrogen.
Based on technology, the hydrogen generation market is categorized into steam methane reforming, partial oil oxidation, coal gasification, and water electrolysis. Of these, steam methane reforming is expected to hold a significant share in the market during the forecast period. It is an advanced technology that uses high-temperature steam to produce hydrogen from natural gas. Most of the oil and gas refineries around the world use steam reforming to produce hydrogen.
Petroleum refining, ammonia production, methanol production, power generation, and transportation are the key application areas of hydrogen. Of these, petroleum refining held a significant share in the hydrogen generation market during the historical period owing to the increased consumption of hydrogen to reduce sulfur content in petroleum products. However, during the forecast period, the market is expected to witness prominent growth in the transportation category owing to the increasing sales of fuel-cell vehicles.
Geographically, the hydrogen generation market is divided into Asia-Pacific (APAC), North America, Latin America, Europe, and the Middle East and Africa. During the forecast period, APAC region is expected to hold a significant share in the market owing to the increasing refining capacity of the region to meet the rising fuel demand. Moreover, China and Japan are investing heavily in the R&D of fuel cells to increase the production of electric vehicles.
Hydrogen Generation Market Dynamics
Growing demand for cleaner fuels and limited availability of high-quality light and sweet crude oil are the key factors driving the growth of the hydrogen generation market. The introduction of fuel-cell vehicles is resulting in the increased usage of renewables sources of fuel owing to the stringent environmental regulations to curb carbon emissions. As per the IEA’s World Energy Outlook 2018, 300 hydrogen fuel stations had been installed across the globe until 2018, with an investment of $200.0 million. The increasing adoption of hydrogen in fuel-cell vehicles is supporting the growth of the hydrogen generation industry, globally.
In addition, the limited availability of light and sweet crude oil is driving the hydrogen generation market. Refineries require a high amount of hydrogen in applications such as catalytic cracking and hydrocracking for the processing of low-quality heavy and sour crude oil. Thus, the growing requirement for hydrogen in the processing of crude oil continues to support the market growth.
The growth in the hydrogen generation market is moderately restricted by the high capital requirement for water electrolysis. The cleaner way to produce hydrogen is water electrolysis, but the method is quite expensive and involves heavy electricity cost. In contrast, production processes such as steam methane reforming and coal gasification are less expensive but emit a significant amount of greenhouse gases. These factors restrain the adoption of these techniques to some extent, which, in turn, impacts the market growth.
Hydrogen Generation Market Competitive Landscape
Some of the major players operating in the global hydrogen generation market are L’AIR LIQUIDE S.A., Air Products and Chemicals Inc., Iwatani Corporation, Hydrogenics Corporation, Linde AG, Praxair Inc., Messer Group GmbH, Showa Denko K.K., Caloric Anlagenbau GmbH, and CLAIND S.r.l.
The study provides the historical as well the forecast market size data for various countries, including the U.S., Canada, France, Germany, the U.K., Italy, Spain, Japan, China, India, Brazil, Saudi Arabia, and South Africa.