Water Electrolysis Market Report 2025

This Water Electrolysis market report delivers an in-depth analysis of the market’s key characteristics, including size, growth potential, and segmentation. It provides a detailed breakdown of the market across major regions and leading countries, highlighting historical data and future growth projections. The report also examines the competitive landscape, market share insights, emerging trends, and strategic developments shaping the market.

The water electrolysis market size has grown strongly in recent years. It will grow from $7.81 billion in 2024 to $8.59 billion in 2025 at a compound annual growth rate (CAGR) of 10%. The growth in the historic period can be attributed to rising environmental concerns, use of hydrogen in sustainable agriculture practices, the increasing need for hydrogen in industrial processes, the construction and expansion of water electrolysis facilities, and the growing recognition of hydrogen's benefits.

The water electrolysis market size is expected to see strong growth in the next few years. It will grow to $12.44 billion in 2029 at a compound annual growth rate (CAGR) of 9.7%. The growth in the forecast period can be attributed to the growing need for environmentally friendly hydrogen, supportive policies and subsidies from governments, expansion of renewable energy sources, investments in hydrogen infrastructure, and decreasing costs of electrolyzers. Major trends in the forecast period include Advancements in electrolyzer materials, power-to-x technologies, hybrid systems, automation and control systems, and integration with carbon capture technologies.

The growing demand for hydrogen production is anticipated to drive the expansion of the water electrolysis market in the coming years. Hydrogen production encompasses various methods such as electrolysis, steam methane reforming, and biomass gasification to generate hydrogen gas. The push towards reducing carbon emissions and shifting to cleaner energy sources fuels this demand. Water electrolysis contributes to hydrogen production by using electricity to split water into hydrogen and oxygen, providing a clean and sustainable method of generating hydrogen fuel, particularly when powered by renewable energy sources. For example, in July 2023, the International Energy Agency, a France-based intergovernmental organization, reported that low-emission hydrogen production accounted for less than 1% of total hydrogen output in 2022, despite a 5% increase from 2021, indicating gradual progress towards cleaner hydrogen production. Thus, the rising demand for hydrogen production is boosting the water electrolysis market.

Key players in the water electrolysis market are focusing on developing innovative products, such as proton exchange membrane (PEM) water electrolyzers, to improve hydrogen production efficiency and lower energy consumption. PEM water electrolyzers use a solid polymer electrolyte to separate water into hydrogen and oxygen through an electrochemical process, offering high efficiency and versatility in hydrogen production. For instance, in March 2024, Sungrow Power Supply Co. Ltd., a manufacturing company based in China, introduced the 300Nm³/h PEM Water Electrolyzer. This device produces 300Nm³ of hydrogen per hour with high efficiency, requiring less than 4.15kWh/Nm³. It is designed to accommodate flexible hydrogen production using renewable energy sources, ensuring optimal performance in various scenarios.

In April 2024, Andritz AG, an Austria-based machinery manufacturing firm, acquired a 13.8% stake in HydrogenPro for an undisclosed sum. This acquisition bolsters the strategic partnership between Andritz and HydrogenPro, improving their capacity to serve Andritz’s customers more effectively. HydrogenPro, based in Norway, specializes in high-pressure alkaline electrolyzers (AEL), which are essential for large-scale production of green hydrogen.

Major companies operating in the water electrolysis market are Robert Bosch GmbH, ThyssenKrupp AG, Siemens Energy AG, Linde AG, Toshiba Energy Systems & Solutions Corporation, Cummins Inc., Sungrow Power Supply Co. Ltd., LONGi Green Energy Technology Co. Ltd., Plug Power Inc., KTH Royal Institute of Technology, Sunfire GmbH., Nel ASA., Ohmium International Inc., Shandong AUYAN New Energy Technology Co. Ltd., HydrogenPro ASA, Ceres Power Holdings plc, McPhy Energy SA., Horizon Fuel Cell Technologies Pte Ltd, ITM Power PLC., Giner ELX Inc., SES Hydrogen, Enapter AG, Elogen SAS, Next Hydrogen Solutions Inc., CAPLINQ Corporation, GreenH Electrolysis.

Europe was the largest region in the water electrolysis market in 2024. North America is expected to be the fastest-growing region in the forecast period. The regions covered in the water electrolysis market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the water electrolysis market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Water electrolysis is the process of using electricity to decompose water (H₂O) into its basic elements, hydrogen (H₂) and oxygen (O₂). By passing an electric current through water that contains an electrolyte, hydrogen is generated at the cathode (negative electrode) and oxygen at the anode (positive electrode). This technique is commonly employed for generating hydrogen for industrial uses, clean energy, and fuel cells.

The primary types of products in the water electrolysis market include alkaline electrolyzers, proton exchange membrane (PEM) electrolyzers, solid oxide electrolyzer cells (SOEC), and anion exchange membrane (AEM) electrolyzers. Alkaline electrolysis utilizes an alkaline electrolyte, such as potassium hydroxide (KOH) or sodium hydroxide (NaOH), to facilitate the water splitting process. Input power options for these systems vary from below 2 kW, between 2 kW and 5 kW, to above 5 kW, with hydrogen production capacities categorized as below 500 l/hr, between 500 and 2000 l/hr, and above 2000 l/hr. End-user applications include ammonia production, methanol production, refining, power and energy storage, transportation or mobility, and other sectors.

The water electrolysis market research report is one of a series of new reports that provides water electrolysis market statistics, including water electrolysis industry global market size, regional shares, competitors with a water electrolysis market share, detailed water electrolysis market segments, market trends, and opportunities, and any further data you may need to thrive in the water electrolysis industry. This water electrolysis market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The water electrolysis market consists of revenues earned by entities by providing services such as electrolyzer installation and commissioning, maintenance and repair services, consulting, and system design. The market value includes the value of related goods sold by the service provider or included within the service offering. The water electrolysis market also includes sales of polymer electrolyte membrane water electrolyzers, high-pressure electrolyzers, and modular electrolyzers. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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