Electrolyzers Market Outlook, 2030

The global electrolyzer market is rapidly evolving from a niche industrial tool into a central technology of the low-carbon energy transition, driven by a mix of cultural, economic and policy forces that are reshaping how countries, companies and communities think about energy, industry and local development. Culturally, electrolyzers are moving from being seen as technical curiosities to symbols of industrial decarbonization and national energy sovereignty, with governments and large corporates increasingly framing green hydrogen projects as markers of climate leadership and industrial strategy, which in turn spurs public-private partnership models and regional supply chain clustering. The rising adoption of hydrogen in industries such as chemicals, refining, and steel production is boosting the need for electrolyzers as crucial instruments for hydrogen generation. Sectors are progressively acknowledging the importance of electrolyzers in their strategies for decarbonization. In August 2024, AM Green reached a Final Investment Decision (FID) for this initial million-ton green ammonia venture that will utilize 1.3 GW of electrolyzers. John Cockerill Hydrogen is set to provide sophisticated pressurized alkaline electrolyzers featuring a capacity of 640 MW in phase 1, ensuring economical green hydrogen production due to continuous renewable energy generated from a mix of wind and solar power, complemented by pumped hydro storage. Urbanization is amplifying these market dynamics by concentrating industrial demand, transport needs and municipal decarbonization ambitions in dense corridors, as cities and industrial clusters create predictable offtake for steel, ammonia, chemicals and heavy transport, offer grid and renewable co-location opportunities and incentivize local hydrogen ecosystems, making urban growth a driver for both short-term demand for electrolyzers and the case for distributed, modular units located near industrial hubs. Policy and regulatory frameworks are also pivotal, with regional hydrogen strategies, large grant and auction programs and tax incentives in the European Union, the United States and key Asian markets unlocking projects and bankability, such as major EU funding rounds for renewable hydrogen projects and recent US tax credit clarifications that enable production tax credits for green hydrogen.

According to the research report “Global Electrolyzer Market Outlook, 2030”, the global Electrolyzer market is projected to reach market size of USD 13.32 billion by 2030 increasing from USD 3.00 billion in 2024, growing with 28.81% CAGR by 2025-30. The increasing awareness of hydrogen's potential as a clean fuel option is leading to investments in these infrastructures, which, in turn, boosts the demand for electrolyzers. In October 2024, GreenH Electrolysis, a partnership between H2B2 Electrolysis Technologies and GR Promoter Group, officially launched its inaugural 1 MW Proton Exchange Membrane (PEM) electrolyzer at its production facility located in Jhajjar, Haryana. The 1 MW PEM electrolyzer is planned to be set up at the hydrogen production and refueling site in Jind, Haryana, aiding India’s initial hydrogen-powered train as part of the Indian Railways’ “Hydrogen for Heritage” program. This electrolyzer is designed to function continuously, generating approximately 430 kg of hydrogen daily at a delivery pressure of 40 bar (g), conforming to ISO 14687 specifications for fuel cell applications. The Jind station will additionally include a 3,000 kg hydrogen storage unit, a hydrogen compressor, and two dispensers with integrated pre-coolers, facilitating effective refueling. Additionally, technology diversification is opening new pathways for deployment, with alkaline electrolyzers gaining traction for large industrial projects, proton exchange membrane (PEM) units expanding in mobility and dynamic power applications, and solid oxide electrolyzers emerging as high-efficiency solutions when integrated with industrial heat. Opportunities in the market are being amplified by large-scale policy interventions such as the European Union’s Green Deal, the United States Inflation Reduction Act hydrogen tax credits, and national green hydrogen missions in countries like India, Japan, and Australia, all of which create favorable investment climates and de-risk early projects. Notable gatherings such as the World Hydrogen Summit, the Hydrogen Technology Expo, and the Green Hydrogen Global Assembly attract stakeholders from across the value chain, showcasing the latest electrolyzer technologies, pilot project results, and investment opportunities. Regional trade fairs and industry-specific hydrogen forums also help connect electrolyzer manufacturers with buyers in transportation, energy, and industrial sectors.

Market Drivers

• Growing demand for green hydrogen: The accelerating demand for green hydrogen, fueled by the urgent need to decarbonize energy systems and reduce reliance on fossil fuels. Governments and industries worldwide are adopting ambitious net-zero targets, which require large-scale hydrogen production powered by renewable energy. Electrolyzers play a central role in this transition, as they use electricity from wind, solar, and hydro sources to split water into hydrogen and oxygen without emitting CO₂. Sectors like transportation, steel, and ammonia production are actively exploring green hydrogen to replace carbon-intensive fuels, leading to increasing investments in electrolyzer manufacturing capacities and infrastructure.
• Strong government support and policy incentives: Favorable policy frameworks and funding programs are giving a substantial boost to electrolyzer adoption globally. Countries such as Germany, Japan, Australia, and the United States have launched dedicated hydrogen strategies, offering subsidies, grants, tax credits, and public-private partnerships to accelerate electrolyzer deployment. For example, the European Union’s “Fit for 55” package and Hydrogen Strategy aim to install gigawatts of electrolyzer capacity by 2030. These supportive measures reduce the financial risks for companies investing in hydrogen production facilities and encourage innovations in electrolyzer technology, thereby improving efficiency and lowering costs.

Market Challenges

• High capital and operational costs: Despite the promising potential, the high upfront investment required for electrolyzer systems remains a major barrier to large-scale adoption. Procurement, installation, and integration of electrolyzers into hydrogen production facilities require substantial capital, while operational expenses are impacted by electricity costs, maintenance, and water supply. Although technological advancements and economies of scale are expected to reduce costs over time, current price points still make green hydrogen less competitive compared to conventional hydrogen derived from natural gas, especially in regions with cheap fossil fuels and limited renewable energy infrastructure.
• Limited renewable energy integration and supply chain constraints: Electrolyzers achieve their environmental benefits only when powered by renewable electricity, but in many markets, renewable generation capacity is still insufficient or inconsistent. The intermittent nature of wind and solar energy can lead to fluctuating electrolyzer operation, affecting efficiency and lifespan. Furthermore, supply chain issues, including shortages of key components like membranes, catalysts, and compressors, can delay projects and increase costs. This creates a dependency on a small number of specialized suppliers, posing risks of bottlenecks as global demand rapidly scales.

Market Trends

• Shift toward large-scale and modular electrolyzer projects: The industry is witnessing a shift toward both gigawatt-scale centralized hydrogen production plants and modular, scalable electrolyzer systems. Large-scale projects, often integrated with renewable energy farms, aim to supply hydrogen to industrial hubs and export markets. Meanwhile, modular electrolyzers offer flexibility for decentralized applications, allowing companies to start with smaller units and expand capacity over time. This dual approach is enabling faster adoption across diverse use cases, from fueling stations to industrial manufacturing.
• Technological innovations and efficiency improvements: Continuous R&D is driving advances in electrolyzer efficiency, durability, and cost-effectiveness. Emerging technologies such as proton exchange membrane (PEM) electrolyzers, solid oxide electrolyzers (SOEC), and alkaline electrolyzers are being optimized for different operational environments. Innovations in materials, such as non-precious metal catalysts, are reducing reliance on expensive platinum group metals. Additionally, automation, AI-based monitoring, and improved stack designs are enhancing performance, lowering maintenance requirements, and making electrolyzers more viable for both large industrial plants and small-scale applications.

The main reason alkaline electrolyzer technology is leading in the global electrolyzer industry is its proven maturity, cost-effectiveness, and scalability for large-scale hydrogen production.

Alkaline electrolyzer technology holds the largest share in the global electrolyzer industry primarily because it is a well-established and commercially mature solution that offers a lower cost per unit of hydrogen produced compared to other technologies such as proton exchange membrane (PEM) and solid oxide electrolyzers. This technology has been in use for decades, giving it a proven operational track record and reliability in diverse industrial applications, including ammonia production, refining, chemicals, and metallurgy. Its design uses a liquid alkaline electrolyte, typically potassium hydroxide (KOH) or sodium hydroxide (NaOH), which is inexpensive and widely available, resulting in lower capital and operational costs. Moreover, alkaline electrolyzers operate with non-precious metal catalysts such as nickel, which significantly reduces dependence on scarce and expensive materials like platinum or iridium used in PEM systems, making them more economically viable for large-scale deployment. The technology’s robustness allows it to handle continuous operation for long periods with minimal degradation, making it attractive for industries requiring stable hydrogen supply. Alkaline electrolyzers can be manufactured in large capacities, often exceeding several megawatts, enabling economies of scale that further lower the levelized cost of hydrogen production. Another key advantage is their ability to integrate with renewable energy sources, especially in projects where stable power supply is possible, such as large solar farms or onshore wind facilities, without demanding highly dynamic load-following capabilities. Countries focusing on cost competitiveness in green hydrogen production, such as China, India, and several European nations, are prioritizing alkaline electrolyzers for their flagship hydrogen projects.

The main reason power plants are the leading application type in the global electrolyzer industry is their large-scale and consistent demand for hydrogen, which aligns perfectly with electrolyzer capacity and operational efficiency.

Power plants dominate the electrolyzer market because they require substantial quantities of hydrogen for various operational purposes, making them ideal candidates for large-scale electrolyzer deployment. Hydrogen is increasingly used in power generation to either co-fire with natural gas or fully replace fossil fuels in turbines, thereby reducing carbon emissions and supporting global decarbonization targets. The predictable and continuous energy demand of power plants matches well with electrolyzers’ operational characteristics, particularly alkaline and PEM systems, which perform efficiently under steady load conditions. This makes hydrogen integration economically viable while ensuring high system reliability. Large-scale power plants, especially in regions focused on green hydrogen production, also benefit from proximity to renewable energy sources like solar, wind, and hydropower, which can supply low-cost electricity for electrolysis, reducing operational costs and enhancing overall energy efficiency. Countries in Asia-Pacific, Europe, and North America are increasingly investing in hydrogen-ready power plants as part of their energy transition strategies, driven by stringent emission regulations and national decarbonization policies. Power plants not only provide a stable market for hydrogen but also create synergies with grid management, allowing excess renewable electricity to be stored as hydrogen and used during peak demand or periods of low generation, effectively balancing supply and demand. The integration of electrolyzers with existing industrial-scale infrastructure in power plants reduces the need for additional land and capital investment, further improving the economic feasibility of hydrogen production. Additionally, governments and regulatory bodies worldwide are offering incentives and subsidies for hydrogen adoption in energy-intensive sectors, with power generation being a primary focus, which accelerates deployment.

The main reason Asia-Pacific is leading in the global electrolyzer industry is its aggressive renewable energy expansion combined with strong government policies supporting green hydrogen production.

Asia-Pacific’s dominance in the global electrolyzer industry is driven by the region’s rapid renewable energy growth, strong decarbonization goals, and strategic investments in green hydrogen infrastructure. Countries like China, Japan, South Korea, India, and Australia have been heavily investing in large-scale solar and wind energy projects, which provide the low-cost renewable electricity needed for electrolysis. China, in particular, has emerged as a manufacturing hub for electrolyzers, benefiting from economies of scale, extensive supply chains, and competitive production costs that enable it to serve both domestic and export markets. Japan and South Korea are pushing hydrogen adoption as part of their long-term energy transition strategies, with national hydrogen roadmaps that include subsidies, pilot projects, and partnerships between public and private sectors. India, with its abundant renewable potential and the National Green Hydrogen Mission, is attracting international players to establish electrolyzer manufacturing plants. Australia is leveraging its vast renewable resources to become a major green hydrogen exporter, building mega-projects aimed at supplying both domestic industries and overseas markets. In addition to infrastructure, Asia-Pacific governments are actively implementing supportive policies, financial incentives, and regulatory frameworks to accelerate electrolyzer deployment. For example, tax benefits, low-interest loans, public funding for research and development, and international collaboration programs have boosted market confidence and reduced project risks. The region also benefits from rising industrial hydrogen demand for applications in refining, steel, chemicals, and ammonia production, creating a strong domestic market base.

• In July 2025, Hynamics I-JK, a wholly owned subsidiary of EDF Group focused on low-carbon and renewable hydrogen production and Hy24, a leading low-carbon hydrogen asset manager, signed a Memorandum of Understanding (MoU) to establish an exclusive partnership. The collaboration aims to jointly develop and finance the Fawley Green Hydrogen Project.
• In October 2024, Danish renewables developer European Energy formally inaugurated its initial green hydrogen facility located close to Esbjerg, signifying its first foray into extensive hydrogen production utilizing renewable energy.
• In September 2024, Asahi Kasei, signed an MOU with De Nora for the production of electrolyzer cells and small-scale electrolyzers. This collaborative agreement aims at the joint design, assessment, analysis, and marketing of small pressurized alkaline water electrolyzer.
• In May 2024, Avium, a company specializing in alkaline electrolysis and backed by Tallgrass, has been awarded a USD 5 million grant from the Department of Energy (DOE) for three years. This funding from the DOE will expedite the commercialization of durable and dependable alkaline electrolyzers by integrating Avium’s established low-cost, high-efficiency catalysts with stacks engineered to accommodate Avium’s elevated hydrogen production capacities.
• In November 2023, Siemens Energy and Air Liquide inaugurated a new gigawatt electrolyzer factory in Berlin. Siemens Energy's establishment of the new factory is making electrolyzers widely available and setting the groundwork for the expansion of the hydrogen economy. To transform hydrogen into a pivotal element for a climate-neutral future, it must be accessible in substantial volumes and at competitive prices.
• In September 2023, Enapter AG introduced the AEM Flex 120, a new AEM electrolyzer aimed at streamlining the introduction of industrial and refueling pilot projects. The AEM Flex 120 integrates up to 50 AEM Stack core modules, ensuring adaptable operation and heightened responsiveness to varying renewable energy inputs. It generates approximately 53 kg of hydrogen per day at 99.999% purity and is optionally equipped with a dryer. This fills the market gap between Enapter's AEM Electrolyser EL 4 (producing 1 kg/day) and its megawatt-scale AEM Multicore (capable of 450 kg/day).
• In August 2023, Plug Power Inc. inaugurated the World’s First 15-ton-per-day (TPD) liquid green hydrogen plant in Camden County, Georgia. The plant was constructed in 12 months and has 40 MW of Plug proton exchange membrane (PEM) electrolyzers.

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