U.S., EUROPE AND ASIA INDUSTRIAL HYDROGEN MARKET ANALYSIS

Market Challenges And Opportunities

Drivers

Growing demand for fertilizers owing to the rising need for quality yield due to rising population is expected to augment the market growth of industrial hydrogen. Industrial hydrogen is used in the production of ammonia and ammonia is widely used in the production of fertilizers. Moreover, hydrogen is also used in the electronic, metal fabrication, and pharmaceutical industry and microeconomic growth of these industries is expected to foster the market growth industrial hydrogen in U.S., Europe and Asia.

Increasing application hydrogen across the LED and semiconductor industry where it is used to control the atmosphere in the production of LED and semiconductor is expected to augment the market growth. Growing demand for LED as it is highly efficient and have long operational life compared to incandescent is projected to fuel the demand for hydrogen, which in turn propelling the market growth of hydrogen over the forecast period. Furthermore, the booming electronic industry is also projected to propel the market growth of hydrogen. 

Market Restraints

The production cost of hydrogen is high, as it is mainly produced from natural gas, coal and various hydrocarbons and only a small fraction of hydrogen, in the range of 3-4%, is produced during electrolysis of water because it is relatively more energy-intensive. Moreover, overall production of hydrogen is expensive than conventional production. Therefore, the high cost of the hydrogen is estimated to restrict the market growth of hydrogen over the forecast period.

Use of hydrogen that is produced by electrolysis is limited to energy sectors where renewable energy such as solar or wind is used for producing electricity for electrolyzers. Therefore, the limited application of hydrogen that is produced by the electrolysis process is projected to hinder the market growth of hydrogen.

Market Opportunities

Higher emphasis on enhancing overall process economics owing to the high production costs of electrolytic hydrogen. Many manufacturers are focusing on increasing overall efficiency of the process such as advancements in membrane and catalyst are projected to cut down the overall production cost significantly in the near future. Moreover, rising focus on a technical scale of production i.e. development of high-pressure electrolyzers and overvoltage reduction of the oxygen evolution reaction (OER) in electrolyzers is further projected to offer significant growth opportunities to the market of hydrogen.

Increasing usage of hydrogen as a fuel in rockets since it is highly flammable and efficient is projected to propel the market growth. Hydrogen is enough to offer power to powerful machines such as spaceships and also it is environmentally friendly and much safer choice as compared to other fuel sources which are further propelling the market growth of hydrogen. Moreover, rising demand for hydrogen as a fuel is also attributed to the fact that it is three times as powerful as gasoline and other fossil fuels which is also predicted to foster market growth. 

Figure 2. U.S., Europe and Asia Industrial Hydrogen Market – Opportunity Analysis