Global Market Size $1.64 billion Compound Annual Growth Rate (CAGR) 14.1% Green hydrogen, produced using low-carbon or renewable energy, is seeing increasing demand due to its significantly lower carbon emissions. Furthermore, hydrogen’s high combustibility makes it a viable carbon-neutral energy source to replace fossil fuels, heightening expectations for its growth. Driven by carbon neutrality goals, eco-friendly energy policies, and technological advancements, governments and companies worldwide have announced large-scale investments in green hydrogen since 2023. The European Union (EU), the United States, Japan, China, South Korea, and Australia are actively pursuing policies, with major European nations leading the market. By industry sector, significant growth prospects for green hydrogen are evident in transportation, heavy industry, and power generation. Green hydrogen is particularly gaining attention as a solution for decarbonization in the transportation sector, which has high greenhouse gas emissions.
🗞️Related Reports Available at IARC
Global Green Hydrogen Market Report
Global Hydrogen Gas Market Report
Global Hydrogen Sulfide Market Report
👨🏫What Do IARC Research Analysts Say?
(Analyst A) Hydrogen electrolysis technologies, including Alkaline Water Electrolysis (AWE), Polymer Electrolyte Membrane (PEM), and Solid Oxide Electrolysis Cell (SOEC), continue to advance. Cost reductions from mass production of electrolysis equipment, such as electrolysers, are becoming prominent, driving expectations for green hydrogen market growth. Alkaline water electrolysis (AWE), expected to hold the largest share in the green hydrogen market, offers several notable advantages. First, AWE produces relatively high-purity hydrogen without emitting pollutants during the production process. It is also suitable for large-scale hydrogen production, featuring relatively low costs and high durability, making it applicable for hydrogen production and storage linked to solar and wind power generation. Moreover, the electrodes, cells, and membranes of alkaline electrolyzers are relatively inexpensive yet highly efficient and ensure long-term stability, establishing them as core technologies for eco-friendly hydrogen production. These characteristics clearly demonstrate that AWE is a promising technology poised to drive the growth of the green hydrogen market.
(Analyst B) Industries associated with green hydrogen include transportation, steel/chemicals, and power generation. In transportation, the realization of hydrogen mobility—including fuel cell electric vehicles (FCEVs), hydrogen trains, ships, and aircraft—is anticipated. Green hydrogen is gaining attention in the transportation sector as a solution for decarbonization. Large vehicles like trucks and buses, with their long-distance operations and high energy demands, are well-suited for hydrogen fuel cell technology. Hydrogen also holds potential for powering trains and aircraft, expected to significantly contribute to reducing carbon emissions in the future. In the steel and chemical sectors, which generate substantial carbon emissions during production, eco-friendly processes are anticipated to expand through hydrogen-based ironmaking methods or green hydrogen-based ammonia production technologies. In power generation, the activation of hydrogen storage systems combined with solar and wind power is anticipated. Thus, demand for eco-friendly hydrogen is expected to surge significantly across major global nations and industrial sectors. However, green hydrogen is a highly flammable gas that can ignite easily in enclosed spaces. Its low molecular weight allows it to penetrate materials more readily than other gases, posing a high explosion risk—a factor identified as a market inhibitor. Additionally, concerns exist that compromised integrity of storage systems or transport equipment could lead to leaks or failures. Consequently, developing technologies and countermeasures to enhance safety is essential moving forward.
✅Latest Regulations, Certifications & M&A Status
As green hydrogen gains attention as an eco-friendly energy source, support from major governments is also strengthening. The European Union (EU) has set a target to secure over 40GW of electrolysis capacity by 2030, while the United States announced a tax credit of up to $3 per kilogram of hydrogen, based on greenhouse gas emissions during production, through the Inflation Reduction Act (IRA). South Korea aims to produce 270,000 tons of hydrogen by 2030 and 5.26 million tons by 2040, while Japan is pursuing the expansion of global supply chains in its hydrogen strategy. China envisions establishing the world’s largest renewable energy-based hydrogen production hub. As government subsidies and tax credits (such as the U.S. Inflation Reduction Act (IRA) and EU RED II) are being expanded, and only certified hydrogen can be exported or imported in international transactions, hydrogen-related certifications are increasingly important. Representative certification programs include the EU’s CertifHy hydrogen certification system, the Clean Hydrogen Certification (45V PTC) based on the U.S. Inflation Reduction Act (IRA) tax credit criteria, and ISO 19880, which sets hydrogen quality and infrastructure standards under the International Organization for Standardization (ISO). Countries worldwide are actively building large-scale hydrogen hubs and industrial clusters, while joint ventures and collaborations among global companies are increasing. Amid this trend, Korean companies are also participating in major projects and making their presence known. First, Hanwha Solutions is collaborating with German hydrogen technology companies to focus on developing hydrogen production and storage technologies. Notably, Germany recognizes only ‘green hydrogen’ as sustainable hydrogen under the European Union’s hydrogen strategy. Aligning with this, Hanwha Solutions is actively participating in developing hydrogen production technology based on renewable energy electrolysis, as well as storage and transportation technologies, thereby significantly enhancing its technological competitiveness.
Hyundai Motor is collaborating with Saudi Aramco, Air Products Quadra (APQ), and SAPTCO in Saudi Arabia to establish a hydrogen mobility ecosystem. This project includes a hydrogen electric bus demonstration program, hydrogen charging infrastructure development, and hydrogen mobility research programs, drawing attention as a green hydrogen-based mobility demonstration initiative. Meanwhile, the Australian federal government and the Western Australian government are investing approximately AUD 140 million (about KRW 126 billion) to build a large-scale hydrogen hub in the Pilbara region. They have set a target to produce approximately 492,000 tons of hydrogen annually starting in 2028, equivalent to the annual hydrogen consumption of 26,000 large hydrogen vehicles. The Pilbara Hydrogen Hub is a leading green hydrogen production base utilizing electrolysis powered by renewable energy sources like solar and wind. British energy company BP is participating in this project and plans to export hydrogen produced via renewable energy-based electrolysis facilities to the Asian market.
🔈Related Exhibition and Seminar Information
World Hydrogen Summit & Exhibition, 2025, May 20-22, Rotterdam, Netherlands
International Hydrogen Technologies Congress, 2025, May 25-28, Izmir, Turkey
Connecting Hydrogen Europe, 2025, June 18-19, Madrid, Spain
Hydrogen Technology Expo North America, 2025, June 25-26, Houston, USA
Green Hydrogen Summit West Coast, 2025, September 30-October 1, Seattle, USA
Positioning Hydrogen, 2025, September 27-29, Dubai, United Arab Emirates
World Hydrogen Week, 2025, October 6-10, Copenhagen, Denmark