The Growing Green Hydrogen Market: A Sustainable Energy Revolution
In the search for a sustainable and clean energy future, green hydrogen has emerged as a frontrunner. Green hydrogen is poised to be pivotal in reducing carbon emissions and transitioning to a low-carbon energy landscape. Here we explore the burgeoning green hydrogen market, its potential, challenges, and the promise it holds for a greener world.
What is Green Hydrogen? How is it formed?
Green Hydrogen is a hydrogen gas produced through a process known as electrolysis, using renewable energy sources like wind or solar power. Unlike conventional hydrogen production methods, which often rely on fossil fuels, green hydrogen is considered environmentally friendly and sustainable as it is produced using clean, renewable energy.
The process of green hydrogen production involves splitting water (H2O) into its two constituent elements, hydrogen (H2) and Oxygen(O2). Electrolysis takes place within an electrolyzer, which requires electricity to drive the chemical reaction. When this electricity originates from renewable sources like wind or solar, the hydrogen produced is termed “green” because it has minimal impact on the environment and does not generate greenhouse gas emissions.
Why is it necessary?
Green Hydrogen is necessary to address the pressing challenges of climate change and transition to a sustainable, low–carbon energy future. As the world grapples with the devastating effects of greenhouse gas emissions, green hydrogen offers a vital solution for several prospects:
First and foremost, green hydropower is essential in the battle against climate change. It provides a means to decarbonize sectors that are traditionally hard to electrify, such as heavy industry and long-haul transportation. By replacing fossil fuels with green hydrogen in these applications, we can significantly reduce carbon emissions, helping to limit global warming and its catastrophic consequences.
Moreover, green hydrogen supports the integration of renewable energy sources like wind and solar power. It acts as an energy carrier that can store excess renewable energy, addressing the intermittency of these sources and ensuring a stable and reliable energy supply. Additionally, green hydrogen enhances energy security by Reducing reliance on fossil fuels, promoting energy independence, and fostering local production. It also drives technological innovation and economic growth, creating new job opportunities and promoting a sustainable energy ecosystem.
- Transportation– Fuel cell vehicles powered by green hydrogen offer a clean alternative to traditional gasoline-powered vehicles.
- Industry– Green Hydrogen can be used in industrial processes, such as steel and ammonia production.
- Energy Storage – Green Hydrogen can store excess renewable energy and release it when needed, supporting grid stability.
- Heating– Hydrogen can be used for heating in residential and commercial buildings.
The size of the green hydrogen market is anticipated to exceed USD 515.66 billion by the end of 2025, expanding at a CAGR of 61% between 2023 and 2035. By 2022, the green hydrogen market was worth about USD 1.7 billion. The market is likely to develop as a result of electrolyzers’ increasing capacity, which is predicted to increase the generation of green hydrogen. By 2030, installed electrolyzer output should reach 134–240 GW, double that of the previous year’s predictions. The yearly production capacity of electrolyzers has increased to around 8 GW, nearly double from the previous year. Moreover, by 2030, home consumption is likely to have the largest electrolysis (green hydrogen generation) capacity in the world, at about 60 GW/5 million tons.
Key factors aiding the market’s growth:
- Clean Energy source– Green hydrogen is produced using renewable energy sources like wind and solar power. This means it generates minimal to no greenhouse gas emissions during its production, making it an environmentally friendly and sustainable energy source.
- Versatility– Green hydrogen has a wide range of applications across various sectors. It can be used in transportation to power fuel cell vehicles, in the industry for processes like steel and ammonia production, for energy storage, and as a clean alternative to fossil fuels in heating and electricity generation.
- Energy Storage-Hydrogen can store excess renewable energy, which is especially valuable for balancing the intermittent nature of wind and solar power. It can be used to store surplus energy during periods of high production and release it when demand is high or when renewables are not producing energy.
- Reducing Carbon Emissions– The use of green can significantly reduce carbon emissions in industries and applications where it replaces fossil fuels or other high-emission energy sources. This is crucial in the fight against climate change and meeting emissions reduction targets.
- Long–Term Sustainability– Green Hydrogen has the potential to be along long-term and sustainable energy solution, contributing to a reduction in sustainable energy solution, contributing to a reduction in fossil fuel dependency and a more sustainable future for generations to come.
- Energy Security– Hydrogen can be produced locally, reducing dependence on imported energy sources. This enhances energy security and resilience, especially in regions with abundant renewable resources.
In Europe, mainly due to increasing electrolyzer production capacities, the Green Hydrogen industry has a major market. In a joint declaration signed by the commissioner of the European Commission and 20 CEOs from related industries, the business agreed to tenfold its capacity to reach 17.5 GW per year for producing electrolyzers by 2025.
The industry for green hydrogen is split into two categories based on application: transportation and power generation. The bulk of the market share will go to the transportation sector. The government’s growing endeavors to develop a green hydrogen-based transportation system are blamed for the development. Additionally, the growing popularity of fuel-cell electric cars is anticipated to support the segment’s expansion. More than 40,000 fuel cell electric vehicles worldwide have been put into service since June 2021, of which almost 90% are in four countries: Korea, the USA, China, and Japan.
Key Players in the Industry
- Siemens Energy- Energy transition is the greatest challenge our generation faces. The company reduces emissions while also increasing energy supply. The company’s mission is to support companies and countries with what they need to reduce greenhouse gas emissions and make energy reliable, affordable, and more sustainable.
- Cummins Inc.- In both China and India, Cummins has evolved to become one of the largest engine manufacturers. But Cummins is more than an engine manufacturer, it’s a global leader in the manufacture of diesel and natural gas engines, hybrid engines, and generators, and it’s about to enter the electrified power market.
- Linde plc– With a 2022 sales volume of $33 billion, Linde is the world’s leading industrial gas and engineering company. They aim to make our world more productive every day through the provision of high-quality solutions, technology, and services that result in a higher level of success for customers who help maintain, decarbonize, and protect their planet.
Green Hydrogen Latest Trends:
Green hydrogen projects are making headlines more often. Significant global breakthroughs and investments in green hydrogen have developed in the last year:
- An investment of EUR 4 billion is planned by the Norwegian steel company Blast Green Steel to build a low-carbon steel plant in Finland that would be one of the largest industrial projects in the Nordic country.
- Spain sees itself as Europe’s future leader in the production of green hydrogen to clean up the heavy industries, thanks to its abundance of sun and wind. However, some energy sector experts are concerned about the rapid growth of an industry that will be wholly dependent on a massive increase in the availability of zero-carbon electricity.
- The government in the United States is allocating a significant amount of funds to clear hydrogen initiatives. And the states, too, are beginning to act. For instance, New York has signed an agreement with neighboring countries and 40 hydrogen ecosystem partners to establish a regional Hydrogen Hub to stimulate green hydrogen energy innovation and investment.
- Normandy, France is receiving 12 electrolyzers from Siemens Energy, totaling 200 megawatts in capacity. They will be used in the Normandy project by Air Liquide, a global leader in gases, technologies, and services for industry and health. Air Liquide’s project in the Port-Jérôme industrial zone will generate 28,000 tons of renewable hydrogen per year for use in industry and the transportation sector starting in 2026. A road truck powered by hydrogen could travel 10,000 times around the globe with this much fuel.
- The first hydrogen passenger train in North America is being powered by AcceleraTM by Cummins, the zero-emission business division of Cummins Inc. (NYSE: CMI), which represents a critical turning point and important advancement in the region’s shift to clean urban transportation. Alstom, the world leader in green and smart mobility, makes the train, the Coradia iLint.
The green hydrogen market is a promising frontier in the transition to a sustainable energy future. While challenges exist, investments in research development and infrastructure are accelerating its growth. As the world seeks cleaner energy alternatives to combat climate change, green hydrogen’s potential to reduce carbon emissions and support a cleaner, greener future cannot be underestimated. This market’s evolution will be a critical factor in the fight against climate change and the realization of sustainable energy revolution.
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