Industrial Hydrogen Market size was valued at USD 130 Billion in 2022 and is projected to reach USD 200 Billion by 2030, growing at a CAGR of 6% from 2024 to 2030.
The industrial hydrogen market has seen significant growth in recent years, driven by its diverse range of applications across various industries. Hydrogen is widely used as a raw material in the production of chemicals, refining processes, metalworking, and general industrial applications. It is considered a key element in decarbonizing several industrial sectors and transitioning toward cleaner energy solutions. With its ability to act as a feedstock, energy carrier, and reducing agent, industrial hydrogen plays a crucial role in enhancing operational efficiencies and reducing environmental impacts. In this section, we explore the key applications of industrial hydrogen in four major sectors: General Industry, Metalworking, Refining, and Chemicals.
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In the general industrial sector, hydrogen is primarily used in a variety of applications ranging from energy generation to the production of food and beverages. Its versatility as a clean fuel makes it a critical component in sectors aiming to reduce carbon emissions and reliance on fossil fuels. Hydrogen is used in fuel cells for backup power, in manufacturing processes like glass and ceramics production, and in the electronics industry for purging gases and reducing agents. In addition, hydrogen serves as a heat source in industrial furnaces, where it is a preferred alternative to coal or oil due to its zero-emission properties. As industries worldwide strive to meet environmental sustainability targets, hydrogen is becoming an increasingly important element in achieving these goals.
Beyond energy, industrial hydrogen plays a pivotal role in other processes within the general industry. For example, hydrogen is used for metal reduction, producing ammonia for fertilizers, and in the food industry for hydrogenation processes that extend shelf life. Hydrogen’s ability to act as a high-efficiency energy carrier and its clean-burning characteristics make it a desirable choice for industries seeking to lower their carbon footprint. Additionally, as governments and regulatory bodies introduce stricter emission standards, hydrogen’s importance in the general industrial market is expected to increase, making it a fundamental part of industrial transformations towards greener operations.
In the metalworking sector, hydrogen is mainly used in processes such as reduction, refining, and manufacturing of various alloys. Hydrogen serves as a reducing agent in the production of metals like steel, where it helps eliminate oxygen from iron ore in a process known as direct reduction. This not only reduces the use of coke in steel production but also significantly cuts down carbon emissions associated with traditional blast furnace methods. Hydrogen-powered direct reduction offers a cleaner, more sustainable alternative to conventional steelmaking processes, which are major contributors to global CO2 emissions. As the steel industry is under increasing pressure to reduce its environmental footprint, hydrogen has emerged as a key enabler of sustainable practices.
Hydrogen is also used in the production of other metals such as aluminum and in the refining of metals to remove impurities. The role of hydrogen in metalworking extends beyond production to applications like welding and cutting, where it acts as a fuel or as a reducing agent to maintain high-quality surfaces in metal products. As the metalworking industry shifts towards greener technologies, the integration of hydrogen-based solutions is likely to increase, driven by the push for sustainability, decarbonization, and the demand for cleaner production methods in heavy industries. Hydrogen’s role in the decarbonization of the metalworking industry is expected to be a significant market driver in the coming years.
Hydrogen plays a crucial role in the refining industry, particularly in the processes of hydrocracking, desulfurization, and upgrading. In hydrocracking, hydrogen is used to break down large hydrocarbons into lighter, more valuable products such as gasoline and diesel. This process is vital for producing high-quality fuels and ensuring compliance with stringent environmental regulations. Hydrogen is also employed in desulfurization, where it helps remove sulfur compounds from crude oil to produce cleaner fuels. This is especially important as the global shift towards low-sulfur fuels and cleaner energy sources intensifies. Hydrogen’s use in refining is essential to meet these environmental demands, making it an indispensable element of the industry.
As the refining sector moves towards producing more sustainable fuels, hydrogen is becoming an even more vital resource. Refineries use hydrogen in various catalytic processes to enhance efficiency and reduce emissions. Additionally, hydrogen is utilized in the production of petrochemicals, where it serves as a critical feedstock in processes like alkylation and aromatization. The growing emphasis on decarbonization in the refining sector is expected to drive increased demand for hydrogen. This demand will be supported by both the transition to cleaner fuels and the integration of hydrogen into renewable energy solutions, further expanding the refining industry's reliance on hydrogen.
The chemical industry is one of the largest consumers of industrial hydrogen, with its use spanning across the production of ammonia, methanol, and a variety of other chemicals. Ammonia, a key building block for fertilizers, is primarily produced through the Haber-Bosch process, which requires large quantities of hydrogen. Hydrogen is also essential in the production of methanol, a precursor to a wide range of chemicals and plastics. As the global population grows, the demand for ammonia-based fertilizers is expected to rise, further driving the need for industrial hydrogen. The chemical industry’s dependence on hydrogen for such critical processes positions it as a dominant player in the hydrogen market.
In addition to ammonia and methanol, hydrogen is involved in other chemical processes such as hydrogenation, where it is used to convert unsaturated compounds into saturated ones, thus altering their chemical structure. This is particularly important in the production of edible oils, lubricants, and other chemicals. As the chemical industry faces increasing pressure to reduce emissions and adopt cleaner practices, hydrogen’s role in green chemistry is becoming more prominent. The transition toward hydrogen as a clean energy and feedstock solution is expected to drive innovation and investment within the chemical industry, particularly in areas focused on sustainable chemical production.
The industrial hydrogen market is experiencing several key trends that are shaping its future growth. First, there is an increasing push toward decarbonization, particularly in hard-to-abate sectors like steel manufacturing, refining, and chemicals. Hydrogen’s role in reducing carbon emissions and serving as a cleaner alternative to fossil fuels is becoming more pronounced. This is driving demand for green hydrogen, produced using renewable energy sources such as wind and solar power, and blue hydrogen, which utilizes carbon capture technologies to offset emissions. As industries continue to prioritize sustainability, hydrogen’s contribution to achieving net-zero goals is expected to grow exponentially.
Another key trend is the development of hydrogen infrastructure to support its widespread adoption. Governments and private sector players are investing heavily in hydrogen production, storage, and transportation infrastructure. This includes the development of hydrogen pipelines, fueling stations, and storage facilities. As the infrastructure expands, it is expected that hydrogen will become more accessible to industries and consumers alike, leading to greater market penetration. Additionally, technological advancements in hydrogen production, such as the improvement of electrolysis technologies, are making hydrogen more cost-competitive, further accelerating its integration into industrial applications.
The industrial hydrogen market presents numerous opportunities for growth and innovation. One of the key opportunities lies in the transition to low-carbon and green hydrogen solutions. As governments implement stricter environmental regulations and companies seek to decarbonize their operations, the demand for green hydrogen is expected to surge. Companies involved in the production of electrolyzers, which are used in green hydrogen production, stand to benefit from this trend. Furthermore, the rise of hydrogen-based mobility, such as hydrogen fuel cell vehicles, presents another lucrative opportunity for the industrial hydrogen market. These developments could lead to a significant shift in how hydrogen is produced, distributed, and consumed across industries.
In addition to green hydrogen, blue hydrogen, which is produced from natural gas with carbon capture and storage (CCS) technologies, also presents a major opportunity. Many industries are exploring the use of blue hydrogen as a transitional solution while they work toward fully decarbonized systems. The hydrogen market also holds potential in emerging markets, where industrialization and energy demands are growing rapidly. As such, the global hydrogen market is poised for substantial expansion, and businesses that can capitalize on these trends by investing in infrastructure, technology, and sustainable solutions will be well-positioned for success in the coming decades.
What is industrial hydrogen used for?
Industrial hydrogen is primarily used in refining, chemical production, metalworking, and general industrial processes, particularly for reducing emissions and enhancing efficiency.
How is hydrogen produced for industrial use?
Hydrogen is mainly produced through natural gas reforming, electrolysis of water, and coal gasification, with the latter methods contributing to hydrogen’s increasing role in sustainability.
What are the environmental benefits of industrial hydrogen?
Hydrogen helps reduce carbon emissions by replacing fossil fuels in industrial processes and can be produced in a sustainable manner using renewable energy sources.
Which industries use industrial hydrogen the most?
The chemical, refining, metalworking, and general industrial sectors are the largest consumers of industrial hydrogen, due to their heavy reliance on hydrogen in various production processes.
What is green hydrogen, and why is it important?
Green hydrogen is produced using renewable energy sources like wind or solar power. It is essential for reducing carbon emissions and enabling a transition to cleaner energy systems.
How does hydrogen help in steel production?
Hydrogen is used as a reducing agent in steel production, replacing coke to reduce carbon emissions and making the steelmaking process more environmentally friendly.
What are the challenges in hydrogen infrastructure development?
Key challenges include high
Top Industrial Hydrogen Market Companies
Linde Group
Air Liquide
Air Products
Air Water
Taiyo Nippon Sanso
Messer Group
Yingde Gases
Regional Analysis of Industrial Hydrogen Market
North America (United States, Canada, and Mexico, etc.)
Asia-Pacific (China, India, Japan, South Korea, and Australia, etc.)
Europe (Germany, United Kingdom, France, Italy, and Spain, etc.)
Latin America (Brazil, Argentina, and Colombia, etc.)
Middle East & Africa (Saudi Arabia, UAE, South Africa, and Egypt, etc.)
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Industrial Hydrogen Market Insights Size And Forecast