Electrolyzer Market
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The global electrolyzer market size was valued at USD 8.9 Billion in 2024 and is estimated to grow at a CAGR of 44.2% from 2025 to 2034. Favorable government policies & targets including financial incentives & mandates aimed at global investments toward low-emission fuel will continue to drive the demand for electrolyzers. For instance, the U.S. has set technical targets for PEM electrolysis that aims to achieve up to USD 2 per kg of H2 generation by 2026.
It harnesses electric energy to separate water into hydrogen and oxygen through electrolysis. Usually, an electrolyzer contains an electrolyte, electrodes, and a membrane. Electrolyzers are essential parts of electrolytic cells for spltting water that is powered from sustainable energy sources, thus, contributing greatly to clean energy systems by supplying clean energy for industry, transportation, and energy storage.
Report Attribute | Details |
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Base Year: | 2024 |
Electrolyzer Market Size in 2024: | USD 8.9 Billion |
Forecast Period: | 2025 – 2034 |
Forecast Period 2023 - 2032 CAGR: | 44.2 |
2023 Value Projection: | USD 239.4 Billion |
Historical Data for: | 2021 - 2023 |
No of Pages: | 130 |
Tables, Charts & Figures: | 30 |
Segments Covered: | Product, Capacity, Application and Region |
Growth Drivers: |
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Pitfalls Challenges: |
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The development of the industry will further be driven by the aforementioned factors together with the imposition of carbon emission regulations. Clean hydrogen production technologies are constantly being adopted, which helps improve the industry’s outlook. There is also an increase in consumer preference regarding environmental sustainability and adoption of renewable energy sources. These factors will dictate the market dynamics.
Growing research & development activities for producing green hydrogen coupled with rising government spending on H2 energy design & development programs will influence the product penetration over the forecast timeline. The leading energy, transport, and industry stakeholders are extensively focused to advance electrolyzer technique and enable low-cost hydrogen generation which will accelerate the industry outlook.
The electrolyzer industry growth is primarily stimulated by the increased demand of electricity in commercial and industrial sectors and an increasing focus on renewable energy. Though obstacles such as high capital cost and underdeveloped infrastructure can slow the progress. In spite of these challenges, supportive government policies, incentives, and regulations aimed at infrastructure development as well as increasing consumer preference for sustainability will propel the industry advancements.
The investment firms plan that their strategic alignment along with the ESG goals to achieve the carbon neutrality targets. Increasing investments in electrolyzers that promote decarbonization in industries such as steel, chemicals, and transportation while also fostering long-term sustainability compliance, will foster the product adoption.
PEM is anticipated to grow by more than USD 28.5 billion by 2034 on account of its high efficiency in converting electricity into hydrogen, with rapid start-up and shut-down capabilities, making them ideal for integrating with intermittent renewable energy sources. The growth will be driven by heavy investments by OEMs in their R&D and modern technologies to build large multi-MW scale systems and their ability to fund large-scale onsite hydrogen production for renewable energy storage, hydrogen refueling stations, grid balancing power, and power-to-gas applications.
The electrolyzer market from the transportation segment is set to grow at a CAGR of over 28% up to 2034. Investments in new technologies and the expansion of the FCEV market are projected to fuel the implementation of the product in transport systems. Furthermore, more initiatives aimed at promoting low-emission motor vehicle technologies are expected to enhance the willingness of manufacturers to switch to alternative fuels leading to an improved business climate.
For instance, in February 2023, Germany's Federal Ministry of Digital and Transport, BMDV funded electrolyzer plants with USD 86.59 million. Growing demand for hydrogen-powered vehicles and zero-carbon mandates will drive the product deployment.
The hydrogen has been widely used as an industry feedstock in manufacturing and refining of ammonia, methanol, steel and other chemicals. The Hydrogen Council, stated, that by 2030, we would have produced around 10 to 15 million tons of chemicals using hydrogen as a feedstock which will enhance the demand for electrolyzers in the coming years. Favorable regulatory landscape along with the shifting trends toward renewable will further augment the industry growth.
Eminent players operating in the electrolyzer industry are:
Market, By Product
Market, By Capacity
Market, By Application
The above information has been provided for the following regions and countries:
The industry features key players such as Air Liquide, Asahi Kasei, Erredue, Hystar, IHT, ITM Power, McPhy Energy, Nel, Plug Power, Siemens, Sunfire, Thyssenkrupp Nucera, and Toshiba.
The transportation segment is anticipated to grow at a CAGR of over 28% through 2034, fueled by rising demand for fuel cell electric vehicles (FCEVs) and supportive regulations for low-emission vehicles.
The U.S. electrolyzer market is projected to surpass USD 16 billion by 2034, supported by government initiatives like the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA), alongside increasing industrial demand for clean hydrogen.
The global market for electrolyzer was reached 8.9 billion in 2024 and is projected to grow at a 44.2% CAGR from 2025 to 2034, driven by favorable government policies and mandates to develop the hydrogen ecosystem.
The PEM electrolyzer segment is expected to exceed USD 28.5 billion by 2034, due to its high efficiency in converting electricity into hydrogen and its compatibility with intermittent renewable energy sources.