Global Water Electrolysis Market Ascends at a Healthy CAGR of 35.4%

Introduction

Electrolysis could be used to produce carbon-free hydrogen from renewable and nuclear sources. Through a process known as electrolysis, water is split into hydrogen and oxygen. An electrolyzer is a device that facilitates this procedure. Electrolysis of water is a well-known process applied in numerous industries, including the food industry, the metallurgical industry, and power plants. In addition, the water's components, such as hydrogen and oxygen, have a variety of uses. For instance, hydrogen produced through electrolysis is a clean, sustainable, and efficient fuel source.

Market Dynamics

Increasing Use of Hydrogen in the Petroleum Refining Industry Drives the Global Market

Hydrogen has become a crucial component of the petroleum refining and petrochemical industries due to the extensive use of hydrogen in several processes. The International Energy Agency (IEA) asserts that natural gas is the principal source of hydrogen production in refineries, with methane generating 75% of the required hydrogen. In addition, the expense of methane is regarded as the most significant barrier in the hydrogen production process, which has prompted businesses to seek alternative options for hydrogen production. The production of green hydrogen from large-scale electrolyzers in refineries enables enterprises to meet the rising demand for hydrogen while simultaneously decreasing their carbon footprint. As pressure mounts on refineries to comply with environmental regulations and reduce carbon emissions, it is anticipated that the refining industry will be one of the primary adopters of water electrolysis technology in the future, fueling the global water electrolysis market growth.

Increasing Demand for Hydrogen Energy Storage Creates Tremendous Opportunities

Renewable energy sources commonly encounter supply and demand imbalances because they are most productive when energy demand is low, resulting in excess wasted energy, and least productive when energy demand is high, resulting in energy shortages. Therefore, the demand for energy storage systems utilizing renewable energy sources is increasing. Hydrogen is considered an excellent alternative for energy storage. The hydrogen produced by electrolysis can be stored as a variety of loosely bonded hydride compounds, a compressed gas, or a cryogenic liquid for later use. It is anticipated that the adoption of hydrogen energy storage technology for renewable energy storage would create various lucrative prospects for the growth of the water electrolysis market over the forecast period.

Regional Analysis

Europe is the most significant global water electrolysis market shareholder and is anticipated to grow at a CAGR of 34.0% during the forecast period. To reduce carbon emissions in the region, Europe is aggressively pursuing less expensive technologies for producing hydrogen using water electrolysis. Europe has established a hydrogen plan that addresses the existing and future features of hydrogen production and its applications, as well as its investments in the generation of green hydrogen. In addition, the growing use of green hydrogen as a fuel in different industries, such as transportation, steel, and iron production, is at the forefront of Europe's hydrogen strategy.

North America is estimated to grow at a CAGR of 35.3% over the forecast period. North America is one of the world's most developed regions, and the region's expanding environmental concerns and diminishing energy resources have boosted the demand for sustainable hydrogen production methods. In addition, North America is embracing revolutionary ways of hydrogen production, such as photobiological water splitting, high-temperature water splitting, and water electrolysis. This development demonstrates that investments in sustainable hydrogen production technologies are increasing, driving the expansion of the regional water electrolysis market.

Key Highlights

• The global water electrolysis market was valued at USD 468 million in 2022. It is estimated to reach USD 7,162 million by 2031, growing at a CAGR of 35.4% during the forecast period (2023–2031).
• Based on electrolyzer type, the global water electrolysis market is divided into alkaline electrolyzer, proton exchange membrane (PEM) electrolyzer, solid oxide electrolyzer cell (SOEC), and anion exchange membrane (AEM) electrolyzer. The alkaline electrolyzer segment is responsible for the largest market share and is anticipated to grow at a CAGR of 34.2% over the forecast period.
• Based on end-user application, the global water electrolysis market is segmented into ammonia production, methanol production, refining industry, power and energy storage, transportation/mobility industry, and others. The ammonia production segment owns the highest market share and is expected to grow at a CAGR of 34.9% over the forecast period.
• Europe is the most significant global water electrolysis market shareholder and is anticipated to grow at a CAGR of 34.0% during the forecast period.

Competitive Players

1. Nel ASA
2. ThyssenKrupp AG
3. Asahi Kasei Corporation
4. Cummins Inc.
5. Plug Power Inc.
6. ITM Power PLC
7. Toshiba Energy Systems & Solutions Corporation
8. Teledyne Energy Systems Inc. Ltd.
9. Hitachi Zosen Corporation
10. Siemens Energy AG
11. Enapter AG.
12. John Cockerill.
13. LONGi Hydrogen Technology
14. SunGrow Hydrogen
15. CSSC Peric Hydrogen Technologies
16. Auyan
17. GuoFu Hydrogen
18. Ohmium

Recent Developments

• February 2023- Honda will enhance its fuel cell system as the foundation of its hydrogen business. In an effort to realize a carbon-neutral society, Honda will not only continue to electrify its goods but will also enhance the use of hydrogen as an energy carrier and seek to develop its hydrogen business.
• February 2023- Greenko Group stated that John Cockerill would provide the firm with 28 units of 5MW alkaline electrolyzers for use in its green ammonia factory in Una, Himachal Pradesh.

Segmentation

1. By Electrolyzer Type
   1. Alkaline Electrolyzer
   2. Proton Exchange Membrane (PEM) Electrolyzer
   3. Solid Oxide Electrolyzer Cell (SOEC)
   4. Anion Exchange Membrane (AEM) Electrolyzer
2. By End-User Applications
   1. Ammonia Production
   2. Methanol Production
   3. Refining Industry
   4. Power and Energy Storage
   5. Transportation/Mobility Industry
   6. Others