Report Overview

Growing momentum in investments, rising global awareness of energy security concerns, and an increasing emphasis on climate change goals are expected to drive the Europe Green Hydrogen Market during the forecast period between 2024 and 2030.

Europe Green Hydrogen Market – Industry Trends & Forecast Report, 2030

Europe Green Hydrogen Market size was estimated at USD 189.89 million in 2023. During the forecast period between 2024 and 2030, the Europe Green Hydrogen Market size is projected to grow at a robust CAGR of 47.95% reaching a value of USD 2,946.16 million by 2030. A prominent driver of the Europe Green Hydrogen Market is the rising demand for sustainable energy solutions. Green hydrogen, generated through electrolysis using renewable sources like solar and wind power, serves as a clean alternative to traditional fuels. Its popularity is escalating due to its capacity to significantly reduce carbon emissions, meeting the burgeoning expectations for eco-friendly fuels and positioning itself as a long-term replacement for fossil fuels. In Europe, heightened environmental concerns and a demand for cleaner energy across various industrial sectors further drive the market. With the continent's commitment to decarbonization, green hydrogen, easily transportable through pipelines, assumes a strategic role. Collaborative efforts and initiatives like the European Hydrogen Bank and the REPowerEU plan underscore a commitment to fair competition and the promotion of renewable hydrogen. Also, the green hydrogen demand is expected for rapid growth, driven by significant applications in fuel, chemical feedstock, and a rising demand from the refining and iron & steel industry. The surge in demand for green hydrogen is expected to drive the Europe Green Hydrogen Market over the forecast period.

Green Hydrogen – Overview

The Europe Green Hydrogen Market is characterized by a revolutionary technology centered on producing hydrogen, a versatile and highly reactive fuel, through the process of electrolysis. The method involves using an electrical current to separate hydrogen from oxygen in water, offering a carbon-neutral energy production pathway when the electricity is sourced from renewables. Notably, this green hydrogen production approach holds the potential to mitigate approximately 830 million tons of CO2 emissions annually compared to fossil fuel-based hydrogen generation, as highlighted by the IEA. Despite current concerns about the production cost of green hydrogen, its viability is expected to improve with the ongoing global decarbonization efforts and the subsequent reduction in renewable energy generation costs. Hydrogen, being the most abundant chemical element in nature, has seen a significant surge in demand for fuel purposes, tripling since 1975 and reaching 70 million tons yearly by 2018, according to the IEA. Furthermore, green hydrogen stands out as a clean energy source, emitting only water vapor and leaving no environmental residue, distinguishing it from conventional fuels like coal and oil. Having played a historic role in various industries since the 19th century, hydrogen is poised to gain further prominence in the world's decarbonization journey. If the projected 50% reduction in production costs by 2030, as forecast by the World Hydrogen Council, materializes, green hydrogen is poised to become a pivotal fuel for the future, aligning with the imperative shift toward sustainable energy solutions.

Europe Green Hydrogen Market

Growth Drivers

Increasing Investments in Green Hydrogen Market

The Europe Green Hydrogen Market is experiencing substantial growth, driven by the urgent need to curb carbon emissions, particularly in the transport and industrial sectors. Fueled by renewable energy sources like wind and solar power through electrolysis, green hydrogen emerges as a clean and efficient fuel for power generation. Despite challenges, such as high infrastructure costs, the market foresees significant expansion, propelled by noteworthy investments. The European Union's commitment to invest USD 430 billion by 2030, complemented by the 2020 European Commission's hydrogen strategy envisioning a significant share of the world's energy demand met by clean hydrogen by 2050, underscores a strategic and financial dedication to the green hydrogen sector. The Fit-for-55 package, introduced in July 2021, translates the European hydrogen strategy into a robust policy framework, setting ambitious targets for renewable hydrogen adoption by 2030. Noteworthy investment initiatives, including the Recovery and Resiliency Facility and Important Projects of Common European Interest (IPCEIs) like "IPCEI Hy2Tech" and "IPCEI Hy2Use," showcase a substantial commitment to innovative technologies and infrastructure development. The Clean Hydrogen Partnership, initiated in November 2021, further underscores a strategic focus on research and innovation. This comprehensive and committed approach emphasizes a clear trajectory, where increasing investments play a pivotal role in propelling the Europe Green Hydrogen Market forward.

Challenges

High Production Costs

A significant impediment to the growth of the Green Hydrogen Market is the substantial infrastructure cost associated with adoption and hydrogen transportation. While fossil fuels have long served as a conventional power supply, the envisioned large-scale adoption of hydrogen fuel cell technology in the automotive sector necessitates the establishment of new refueling infrastructure. This anticipated requirement poses a considerable challenge and is expected to hinder the demand for green hydrogen over the forecast period. The existing high infrastructure costs become a critical factor in limiting the market expansion, highlighting the financial barriers associated with the production and widespread adoption of green hydrogen in the current landscape.

Impact of Geopolitical Tensions on Europe Green Hydrogen Market

Europe Green Hydrogen Market is impacted by geopolitical tensions in several ways. The recent invasion of Ukraine has highlighted Europe's vulnerability to Russian oil and gas dependencies, prompting urgent measures to diversify energy sources. In response, the European Union has unveiled plans to reduce reliance on Russian gas, with hydrogen emerging as a pivotal element in this strategy. Hydrogen, as an energy carrier, holds the promise of providing a clean alternative in industries difficult to decarbonize. While the push for green hydrogen is gaining momentum, challenges persist, including the dominance of fossil fuel-derived hydrogen. The geopolitical landscape is shifting, and the evolving energy trade dynamics are expected to significantly impact the Europe Green Hydrogen Market, making it a crucial element in Europe's quest for energy security and independence. The global transition to a low-carbon economy, spurred by recent events like the Russia-Ukraine war, has significant implications for energy value chains. Green hydrogen, with its versatility, gains economic and political momentum and is poised to play a crucial role in achieving a carbon-free future. Current challenges to green hydrogen adoption, such as limited infrastructure and cost concerns, are being reshaped by recent spikes in fossil fuel prices. While green hydrogen is becoming cost-competitive with blue and grey hydrogen, the International Renewable Energy Agency (IRENA) forecasts a substantial decline in green hydrogen costs by up to 85% by 2050, making it a crucial element in Europe's quest for energy security and independence.

Europe Green Hydrogen Market

Segmental Coverage

Europe Green Hydrogen Market – By Technology

Based on technology, the Europe Green Hydrogen Market is bifurcated into Alkaline Electrolysis and PEM Electrolysis segments. The alkaline electrolysis segment holds a higher share in the Europe Green Hydrogen Market by technology. Alkaline electrolysis exhibit an efficiency exceeding 70%, ensuring hydrogen gas purity at 99.5%. This technology is widely employed for electrolytic hydrogen production, resulting in exceptionally pure hydrogen and oxygen at 99.99%. The operational principle involves the transport of hydroxide ions (OH-) from the cathode to the anode within the electrolyte. The production of green hydrogen occurs at the cathode side. Commercially available for an extended period, the alkaline electrolysis technology has established their presence in the market, providing a reliable means of generating high-purity hydrogen through the electrolysis process.

Europe Green Hydrogen Market – By Renewable Source

On the basis of renewable source, the Europe Green Hydrogen Market is bifurcated into Wind Energy and Solar Energy segments. The wind energy segment holds a higher share in the Europe Green Hydrogen Market by application. Wind power, especially onshore wind, stands as the primary contributor to driving the production of green hydrogen. Its widespread availability and economic viability position it as a top preference. Although slightly trailing wind energy, solar power is swiftly gaining ground. Its capacity for decentralized production and seamless integration with current grids adds to its attractiveness.

Europe Green Hydrogen Market – By End User

By End User, the Europe Green Hydrogen Market is divided into Mobility, Chemical, Power, Grid Injection, and Industrial segments. The power segment holds the highest share in the Europe Green Hydrogen Market by end user, due to the high utilization of green hydrogen to provide power to the grid using gas turbines. As renewable energy replaces traditional fossil fuels, the likelihood of increased demand for green hydrogen in the power segment becomes apparent.

Europe Green Hydrogen Market – By Country

The in-depth research report on the Europe Green Hydrogen Market covers the market in the region’s major countries including Germany, United Kingdom, Italy, France, Spain, Belgium, Russia, the Netherlands, and Rest of Europe. Germany dominates the Europe Green Hydrogen Market and is expected to maintain its dominance over the forecast period. The changing regulatory environment, initiation of novel projects, and strategic commercial collaborations, coupled with a widespread adoption of energy efficiency objectives, will drive the integration of hydrogen across diverse sectors. Increased research and development initiatives, coupled with the expansion of large scale and low carbon hydrogen and ammonia projects, will contribute to the establishment of an emission-free economy. The significant abundance of renewable resources, particularly wind and solar, along with the expanding electric vehicle fleet in the country, is expected to have a positive impact on market trends.

Competitive Landscape

Major players operating in Europe Green Hydrogen Market include Siemens Energy, NEL ASA, ITM Power, McPhy Energy, Ørsted, Engie, Hynamics (EDF Group), and Covestro. To further enhance their market share, these companies employ various strategies, including mergers and acquisitions, partnerships, joint ventures, license agreements, and new product launches.

Recent Developments

• In January 2024 - Stellantis Pro One extended its hydrogen fuel cell vehicle production to include medium sized and large vans in Hordain (France) and Gliwice (Poland). The strategic move reinforced Stellantis' leadership in zero-emission commercial vehicles across Europe. As part of the Pro One strategic offensive, the company revamped its van lineup in October 2023. The inclusion of fuel cell technology in medium-sized and large vans aligns with Stellantis' commitment to cutting-edge hydrogen advancements. The fuel cell versions offer rapid refuelling, with medium sized vans achieving a segment record range of up to 400 km and large vans boasting a range of up to 500 km.

• In September 2023 - Germany and England collaboratively embraced green hydrogen, aligning with Plug Power's vision for sustainable energy. Plug, a pivotal player in North America, Europe, and beyond, closely monitors transnational initiatives supporting the sector. The company focuses on delivering clean and reliable hydrogen solutions, spanning the entire value chain. With extensive experience, Plug expands into global markets, establishing itself as a leading force in the green hydrogen sector. While challenges persist, Plug's strategic partnerships and initiatives, such as the Hyvia joint venture, showcase its commitment to advancing green hydrogen solutions and contributing to Europe's decarbonization goals.

• In August 2023 - Morocco positioned itself as a major contributor to Europe Green Hydrogen Market, aiming to meet 5% of the continent's clean energy demand. A study by the Fraunhofer Institute highlights Morocco's strategic investments, totaling nearly EUR 16.4 billion, as key to its potential role as a heavyweight supplier of green hydrogen. The "Morocco Offer" project outlines a roadmap for green hydrogen production, aligning with the country's commitment to sustainable energy. With a target of producing 160 terawatt-hours by 2050, Morocco's dedication and substantial investments position it as a key player in shaping Europe's hydrogen landscape and contributing to cleaner energy solutions globally.

Scope of the Report

By Technology

• Alkaline Electrolysis

• PEM Electrolysis

By Renewable Source

• Wind Energy

• Solar Energy

By End User

• Mobility

• Chemical

• Power

• Grid Injection

• Industrial

By Country

• Germany

• United Kingdom

• Italy

• France

• Spain

• Belgium

• Russia

• The Netherlands

• Rest of Europe