Europe Small Capacity Electrolyzer Market

Europe Small Capacity Electrolyzer Market Size

The Europe small capacity electrolyzer market size was valued at USD 44.8 million in 2024 and is anticipated to reach to USD 81.9 million by 2034, growing at a CAGR of 6.8% from 2025 to 2034. The emerging market for hydrogen as a green energy source coupled with the new developments in the electrolyzer technology such as efficiency, durability and cost will improve the business dynamics.

Rising research & development activities across the technologies will fuel the market growth. Growing awareness of the environmental impact of traditional hydrogen production methods combined with surging development in electrolyzer stack design, membrane materials, and system integration capabilities will foster the business landscape. For instance, in May 2022, the European Commission, alongside regional electrolyzer manufacturers, established a target to boost electrolyzer production capacity by 2025.

Increasing acceptance of gas in several end user sectors such as refineries, chemical industry, semiconductor, glass and food & beverage will drive the overall consumption trends. Ongoing initiatives by respective government authorities toward hydrogen-powered cars along with increasing investments for development of fuel cell infrastructure will complement the industry growth. In April 2022, Swiss Gaznat Innovation Lab ordered Green Hydrogen Systems' HyProvide A90 electrolyzers with a 0.5 MW capacity for renewable hydrogen production.

Europe Small Capacity Electrolyzer Market Trends

• Ongoing governmental plans and targets to promote the adoption of hydrogen technologies to decarbonize the energy systems will boost the business statistics. For instance, in May 2022, the European Commission along with the electrolyzer manufacturers set a target for a tenfold increase in electrolyzer manufacturing capacities by 2025.
  
• Large scale investments in clean energy technologies including electrolyzers in line with gaining traction for decentralized solutions for hydrogen production will increase the product demand. In January 2021, Air Liquide invested in H2V Normandy to acquire 40% stake in the company. The strategic investments led to the development of low carbon infrastructure with additional focus on advancing the electrolyzer complex and enabling the company to support large-scale hydrogen production in France.
  
• Growing collaboration of research institutions, universities, and companies to produce green hydrogen along with rising investments in renewable energy infrastructure will influence the product penetration over the forecasted timeline. In June 2024, Karlsruher Institut für Technologie (KIT) orders AEM Electrolyser with a capacity of 500 kW to be integrated in Energy Lab, Europe’s largest research infrastructure for renewable energy.
  

Europe Small Capacity Electrolyzer Market Analysis

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• Based on product, the market is segmented into alkaline, PEM, solid oxide and others. The Europe small capacity electrolyzer industry amounted to USD 43.5 Million, USD 44.7 Million and USD 44.8 Million in 2022, 2023 and 2024 respectively.
  
• The alkaline electrolyzers segment is set to reach more than USD 10 million by 2034 due to its affordability, flexibility, and rapidly increasing interest in distributed hydrogen production, Denmark launched numerous Power-to-X projects in January 2023. In those P2X projects, wind and solar energy is converted into hydrogen through alkaline electrolyzers.
  
• The PEM small capacity electrolyzer segment is projected to grow at more than 8.5% CAGR through 2034, because of their high current densities, compact system design and quick response to current disturbances. Upsurge in the adoption of hydrogen in energy generation plants and as a fuel across transportation applications will enhance the product deployment. Moreover, high partial load range, dynamic operations, and ability to provide high gas purity are some major factors driving the product deployment. According to the European Hydrogen Observatory, in 2023, a total of 141 water electrolysis projects were identified, with 88 of them having a minimum capacity of 0.5 MW.
  
• The solid oxide market will grow on account of its ability to offer maximum energy efficiency for small scale projects. The growth and performance of small-capacity SOEC systems will be enhanced, which in turn will lead to market growth. Improved ceramic materials and electrode development are making SOEC technology more reliable and durable at smaller scales. These innovations will increase the lifespan of small-capacity systems, thereby contributing to the business landscape.
  

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• Based on capacity, the market is segmented into ≤ 100 kW, > 100 kW - 300 kW, and > 300 kW - 500 kW. The > 300 kW - 500 kW market accounted for 53.6% market share in 2024. Sustainable building development initiatives by respective government authorities in conjunction with rapid urbanization across the developing and underdeveloped economies will propel the business dynamics. Key features including low cost, limited area requirements, and reduced weight will further complement the industry potential. For citation, in May 2022, the European Commission along with the region’s electrolyzer manufacturers set a target for a tenfold increase in electrolyzer manufacturing capacities by 2025.
  
• ≤100 kW systems are utilized for applications involving decentralized hydrogen production, small-scale industrial uses, or integration into renewable energy systems. They require a lower initial investment making them more affordable for small businesses, local energy projects, and industries that might not have the budget for large-scale systems. Further, Governments in Europe and other regions are offering financial incentives, subsidies, and grants for small-scale hydrogen production projects, thereby augmenting the industry landscape.
  
• >100 kW – 300 kW will grow more than 2.5% CAGR till 2034 on account of need for more versatile, cost-effective, and scalable solutions. Systems in this range are ideal for small and medium enterprises (SMEs) or industries that need a reliable hydrogen supply including food processing, chemicals, or small-scale steel production. Moreover, these electrolyzers serve as a dependable means of producing hydrogen, which fulfills local energy requirements and assists in minimizing reliance on centralized power grids in areas that are remote or off the grid.
  

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• Germany small capacity electrolyzer market amounted to USD 31 million, USD 31.2 million and USD 31.2 million in 2022, 2023 and 2024 respectively. The development of large-scale advanced electrolyzer technologies which are more efficient, cost-effective, and easier to scale will further augment the outlook of the industry. For instance, in September 2023, Enapter AG unveiled AEM Flex 120, a 120 kW anion exchange membrane electrolyzer to fuel the green hydrogen projects across the country.
  
• UK small capacity electrolyzer market is anticipated to cross more than USD 8 million by 2034 owing to growing demand for small capacity electrolyzers across decentralized locations. By 2050, the UK government aims to achieve net-zero emissions which has led to a greater interest in green hydrogen as a clean alternative fuel. In July 2022, the UK government launched the world’s first national clean-hydrogen subsidy scheme, which will fund hydrogen projects with the goal of increasing capacity for hydrogen production by 2030.
  
• Italy small capacity electrolyzer market will grow at over 17% CAGR through 2034 owing to enhancing its use of renewable energy sources and decreasing its greenhouse gas emissions. The application of green hydrogen production incentives at the national level, such as those incorporated in the Piano Nazionale Integrato per l'Energia e il Clima (PNIEC) and European Union funded programs like Horizon Europe, will help expand the market reach.
  

Europe Small Capacity Electrolyzer Market Share

• Top 5 players including Bloom Energy, Nordex, Enapter, ITM Power PLC, and McPhy hold 40% of the industry share. Strategic partnerships enable manufacturers to access new markets and mitigate the risks associated with developing and commercializing modern technologies.
  
• Furthermore, collaborations between manufacturers, system integrators, and end-users enable the development of comprehensive solutions tailored to specific applications and operational requirements, thereby overcoming the integration challenges, and enhancing system performance.
  

Europe Small Capacity Electrolyzer Market Companies

• Nordex is a manufacturer of high-quality and efficient pressured alkaline electrolyzers, with focus on sustainability and contributing to the transition towards a clean energy-based economy. The electrolyzer development plan is partially financed with USD 12.5 million by the European Commission, through an IPCEI under the Hy2Tech program.
  
• Enapter is the market leader in AEM electrolyzers, with patented and proven Anion Exchange Membrane (AEM) technology. Recently, the company entered in an agreement with Adsensys to supply AEM stacks, with the aim to implement AEM powered electrolyzers in hydrogen projects with a total electrolysis capacity of 10 MW for customers by 2026.
  
• McPhy Energy is a leading player in alkaline electrolysis and hydrogen production recording a revenue of USD 19.7 Million in 2023, with over USD 13.6 Million of confirmed orders in December 2023. The company has a scalable European industrial base across France, Italy and Germany. 
  

Key market players operating across the Europe small capacity electrolyzer market include:

• Bloom Energy
• Enapter
• Green Hydrogen Systems
• ITM Power
• Larsen & Toubro Limited
• McPhy Energy
• Nordex
• ostermeier H2ydrogen Solutions
• Plug power
• Sunfire
  

Europe Small Capacity Electrolyzer Market Industry News:

• In June 2024, Nordex developed the first prototype for the 500 kW pressurized alkaline electrolyzer. It was designed, manufactured, and assembled entirely in Spain. Further, the system is part of the proposed business development plan, which aims to have the final design of its serializable MW-scale product available by 2026. It can produce more than 10 kg/h of hydrogen with an energy consumption of less than 50 kWh/kg, designed to work with power changes and frequent stops.
  
• In March 2024, Enapter received a grant for its Italian subsidiary Enapter SRL from the Italian Ministry for Enterprise and Made in Italy (MIMIT) for the AEM Technology Next Generation project. The USD 12.5 Million fund received for a duration of 34 months will be utilized for research and development purposes and the further development of the company’s product portfolio.
  
• In February 2024, Corsica Solar constructed its first green hydrogen production unit in Folelli, France. The project is anticipated to be operation by 2025 and will be connected to an existing solar power plant which will be utilized to power 150kW electrolyzer. These electrolyzers can generate two tons of hydrogen annually. Therefore, this significant development will expand the company’s market presence.
  
• In December 2022, Sunfire GmbH delivered a 250kW high temperature electrolyzer system to RWE’s Lingen plant as a part of the TansHyDE project GET H2 Nucleus. The product utilizes solid oxide electrolysis technology, which will support the green hydrogen production for RWE’s test pipeline. The supply order accelerated the company’s presence across the country.
  

This Europe small capacity electrolyzer market research report includes an in–depth coverage of the industry with estimates & forecast in terms of revenue in ‘kW & USD Million’ from 2021 to 2034, for the following segments:

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Market, By Product

• Alkaline
• PEM
• Solid Oxide
• Others

Market, By Capacity

• ≤ 100 kW
• > 100 kW – 300 kW
• > 300 kW – 500 kW

Market, By Application

• Power generation
• Transportation
• Industry energy
• Industry feedstock
• Others

The above information has been provided for the following countries:

• Germany
• UK
• France
• Italy
• Netherlands
• Denmark