Grey Hydrogen Market Size

Grey Hydrogen Market was valued at USD 147.5 billion in 2023 and is anticipated to grow at a CAGR of over 3.4% from 202 to 2032. Grey hydrogen is a type of hydrogen produced from fossil fuels, primarily natural gas, through a process called steam methane reforming (SMR). In this method, methane (CH?) from natural gas reacts with steam (H?O) at high temperatures to produce hydrogen (H?), carbon monoxide (CO), and a small amount of carbon dioxide (CO?). The carbon monoxide then reacts with more steam to produce additional hydrogen and carbon dioxide.

Grey hydrogen is the most widely produced form of hydrogen owing to its relatively low production costs and established infrastructure. It accounts for the majority of global hydrogen production, on account of use of mature processes and facilities for steam methane reforming (SMR). Increasing emphasis on reducing greenhouse gas emissions to combat climate change along with mounting pressure on industries to transition away from high emission processes will augment the industry landscape. The product leaves substantial carbon footprint, however, governments and regulatory bodies are increasingly implementing policies and incentives to reduce carbon emissions, which impacts the attractiveness of grey hydrogen.

Increasing cost competitiveness of grey hydrogen in comparison to other types of hydrogen primarily in regions where natural gas is abundant and inexpensive will drive the market growth. Growing investments aimed at improving the efficiency and reducing the emissions of existing SMR processes, including partial implementation of carbon capture technologies is likely to strengthen the business statistics. Additionally, industries heavily reliant on hydrogen, comprising refining, ammonia production, and chemicals, to reduce the carbon footprint will complement the product adoption.