Hydrogen Market Analysis

Hydrogen Market Analysis

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Based on application, the market is segmented into petroleum refinery, chemical and others. The petroleum refinery segment is anticipated to surpass USD 409 billion by 2034. Increasing demand for hydrogen in refineries, driven by efforts to reduce carbon footprints, is enhancing the industry's outlook. Refineries use hydrogen to lower sulfur levels in diesel and gasoline produced from crude oil. Many refineries worldwide are adopting green hydrogen to achieve net-zero emission targets.
 

For instance, in February 2023, the Indian Oil Corporation (IOC), one of India's largest oil companies, announced plans to establish green hydrogen plants at all its refineries by 2047. Furthermore, the growing demand for hydrogen across hard-to-abate applications involving steel reduction, and methanol & ammonia manufacturing will complement the industry growth.
 

Based on type, the hydrogen market is bifurcated into grey, blue and green. The grey type segment is poised to expand at a CAGR of 11% through 2034. Rising crude oil consumption, coupled with initiatives to upgrade current refining facilities, is set to boost the product demand. Furthermore, steam methane reformation is a prevalent method for producing grey hydrogen, its carbon-intensive nature is steering the industry towards a preference for green hydrogen.
 

Moreover, 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 U.S. hydrogen market is expected to cross USD 36 billion by 2034 owing to development of the global market with significant efforts by multiple government agencies. States like California are leading in hydrogen fuel cell vehicle adoption and infrastructure development. Canada is also positioning itself as a major exporter of clean hydrogen, especially to markets in Asia, thereby contributing to the market growth. Furthermore, driving push for decarbonization, energy transition, and technological innovation will contribute to the market demand.