IDTechEx projects that the low-carbon hydrogen market will grow substantially over the next decade, reaching US$130 billion by 2033 based on projected production capacities. This report evaluates the necessary components to foster the growth of the hydrogen economy, offering a comprehensive review of the entire value chain.It includes technological analyses of all relevant technologies, techno-economic comparisons, detail on key commercial activities (including projects as well as established and emerging companies), major innovations, and market trends across all value chain components.
The hydrogen economy envisions a future energy infrastructure, where low-carbon hydrogen is utilized to decarbonize critical industrial sectors and long-haul transportation while satisfying the increasing demand for low-carbon energy. This economy implies a significant shift in global energy use and industrial processes, with hydrogen technology taking a central role. This transformation will not happen rapidly but there are significant opportunities in developing infrastructure across the whole hydrogen value chain.
Overview of the hydrogen value chain. Source: IDTechEx
For this vision to materialize, various value chain components, including low-carbon hydrogen production, storage, and distribution infrastructure, must align with demand from hydrogen end-use sectors. Like the oil & gas industry, the hydrogen value chain is divided into upstream (production), midstream (storage & transport), and downstream (end-use sectors) elements. Each of these hydrogen value chain components brings its own technical and socio-economic challenges.
Low-Carbon Hydrogen Production
At present, over 95% of the world’s hydrogen comes from fossil fuel-based grey and black hydrogen produced by steam methane reforming and coal gasification plants. Thus, many companies worldwide are focused on developing new low-carbon hydrogen production assets, either blue (natural gas reforming with CO2 emissions captured) or green (water electrolysis powered by renewable energy). These projects are located near industrial users, often in industrial zones with many potential users, which allows for future expansion as these sectors begin to decarbonize.
IDTechEx projects that the low-carbon hydrogen market will grow substantially over the next decade, reaching US$130 billion by 2033 based on projected production capacities. Yet, the upstream is only one part of the value chain that needs to be developed. While most acknowledge the need for substantial production infrastructure, many underestimate the need for a vast midstream (storage & distribution) infrastructure to connect the upstream and downstream assets.
Hydrogen Storage & Distribution
Overview of hydrogen storage & distribution methods covered in the report. Source: IDTechEx
One of the primary challenges with hydrogen, despite its excellent energy characteristics (energy density of 120 MJ/kg), is its complicated storage and transportation due to its extremely low density (0.084 kg/m3) at ambient conditions. Large volumes of hydrogen must be compressed to high pressures (100 to 700 bars) or liquefied at cryogenic temperatures (boiling point of -253°C) to store adequate amounts.
Although these methods are the most commercially and technologically mature, they have significant drawbacks. They consume considerable amounts of energy, thus reducing the effective energy content of the hydrogen. Compression uses around 10-30% of the hydrogen’s original energy content, depending on the pressure. Liquefaction is even more energy-intensive, consuming 30-40% of the hydrogen’s energy content. These factors considerably affect applications in mobility and energy storage by drastically reducing overall round trip energy efficiency. Furthermore, safety risks are associated with compressed gas storage, and liquid H2 storage has boil-off issues, leading to some stored hydrogen being wasted. These issues make transportation, especially internationally, expensive, and inefficient.
Promising alternatives for stationary storage include metal hydride systems for small scale storage and underground storage (like salt caverns) for large scale diurnal or seasonal storage. For transportation, pipelines will play a significant role in connecting production to end-use. Several worldwide players are developing new pure H2 pipelines, with some looking to repurpose existing natural gas pipelines. Ammonia and liquid organic hydrogen carriers (LOHCs) are considered promising, especially for international transport, as they can leverage existing chemical and petrochemical transport infrastructure. The report provides detailed analyses and comparisons of these storage and distribution methods.
End-Use Sectors for Low-Carbon Hydrogen & Hydrogen Fuel Cells
Overview of hydrogen end-use sectors and fuel cell technologies covered in the report. Source: IDTechEx
Hydrogen will play a significant role in decarbonizing industries where it is conventionally used, including refining and the production of ammonia and methanol. These sectors will decarbonize primarily by replacing grey hydrogen with blue and green hydrogen. Another promising sector is steelmaking, where hydrogen can serve as a reducing gas to produce direct reduced iron (DRI). Large steelmakers consider this process as the future of sustainable steel as it will eventually replace the carbon-intensive blast furnace process. Emerging industrial uses of hydrogen include bio- and synfuel production as well as power and heat applications (energy storage, combined heat and power generation, heating for residential/commercial and industrial sectors).
Hydrogen also offers an alternative to electrification in fuel cell mobility sectors. Fuel cell electric vehicles (FCEVs) are gaining traction worldwide, particularly in Asia, with the increasing development of refueling infrastructure and new vehicle concepts for light-, medium- and heavy-duty vehicles. Long-haul transport sectors, including marine, rail, and aviation, also aim to use hydrogen fuel cell propulsion systems. All these sectors will require a combination of fuel cells, suitable hydrogen storage methods, and efficient integration of balance of plant components to operate efficiently.
The report provides technological analysis, opportunities for hydrogen integration and associated challenges, commercial activities, as well as key innovations for each end-use sector outlined above. Hydrogen demand from each sector is presented in the hydrogen demand market forecast.
In addition, the report offers an overview of fuel cells, mainly proton exchange membrane (PEMFC) and solid oxide (SOFC), as well as alternative technologies, such as methanol and molten carbonate fuel cells. Technological analysis, commercial developments, key players, and comparisons of fuel cell technologies are also offered.