Electrolyzers Market Growth Drivers & Opportunities -2030 (2025)

Overview

The electrolyzers market is expected to grow from an estimated USD 3.75 billion in 2024 to USD 78.01 billion by 2030, at a CAGR of 65.9% during the forecast period. The electrolyzer market is booming as the push for clean energy accelerates globally. Electrolyzers are critical components in creating green hydrogen, splitting water into hydrogen and oxygen using renewable energy. Industries are engaging with this developing technology to enable applications - from energy storage and industrial processes to transportation and power generation. Technological advancements, decreasing renewable energy costs, and support from government policies that include subsidies and carbon neutrality targets are the key market growth drivers. Europe, Asia Pacific, and North America are leading markets. Investments in hydrogen infrastructure and large-scale projects are increasing with this growing demand for efficient and cost-effective electrolyzer technology.

The expansion of green hydrogen requires electrolyzers.

The growth of emerging markets like Germany and the UK leads to a higher demand for electrolyzers.

Expansion of urban infrastructure and public utilities increases the need for electrolyzer systems in electrical distribution.

Asia Pacific is expected to be the second-largest market for electrolyzers during the forecast period.

Opportunities: Declining costs of renewable energy

The cost of producing hydrogen through electrolysis is influenced by expenses related to renewable energy, materials, and labor. However, the significant decline in renewable energy costs presents a major opportunity for the electrolyzers market. Advancements in technology and economies of scale have driven down the costs of solar, wind, and other renewables, and the economic feasibility of hydrogen production using electrolyzers has improved. The International Renewable Energy Agency (IRENA) reported that solar photovoltaic (PV) technology has significantly reduced costs since 2010. The global weighted average levelized cost of electricity (LCOE) for newly commissioned utility-scale solar PV projects decreased by 90%, from USD 0.460 per kWh in 2010 to just USD 0.044 per kWh by 2023. This dramatic reduction was accompanied by a substantial global solar PV capacity growth, which expanded from 40 GW in 2010 to 1,412 GW by the end of 2023.

Low energy costs play a crucial role in reducing the operational expenses of the electrolysis process, enhancing the cost-competitiveness of green hydrogen compared to traditional, carbon-intensive production methods. This reduction facilitates the broader deployment of electrolyzers in areas abundant in renewable energy resources and increases the appeal of large-scale hydrogen projects for investors. The growing affordability of renewable energy accelerates the adoption of electrolyzers across various industries, bolstering decarbonization efforts and advancing the development of a sustainable global hydrogen economy.

Challenges: Inadequate support structures for seamless incorporation of electrolyzer technology

The insufficiency in infrastructure presents a notable hurdle for the electrolyzer market, especially in the context of fostering resilient hydrogen markets. With the global demand for green hydrogen rising, the inadequacies in support structures impede the seamless incorporation of electrolyzer technology into broader energy systems. Electrolytically produced hydrogen necessitates a well-established infrastructure encompassing storage, transportation, and distribution networks to reach end-users efficiently. The absence of such an all-encompassing hydrogen infrastructure hinders the fluid adoption of electrolyzer technologies, limiting the scalability of green hydrogen production.

In the absence of a robust infrastructure backbone, the potential impact of electrolyzers in propelling the transition toward clean energy is curtailed. Hydrogen, a byproduct of electrolysis, holds significant promise in decarbonizing various sectors, including transportation, industry, and energy storage. However, the absence of a coordinated infrastructure strategy undermines the capacity of electrolyzers to deliver hydrogen across diverse applications. This challenge is particularly acute in regions where hydrogen markets are in the early stages of development or where necessary infrastructure investments have yet to be realized.

By technology, the anion exchange membrane electrolyzer segment is expected to dominate during the forecast period

The anion exchange membrane (AEM) electrolyzer is gaining prominence in the market as it can strike the ideal balance between cost-effectiveness and performance. They bring down manufacturing costs while maintaining competitive efficiency levels by eliminating the need for costly precious metal catalysts. AEM technology offers flexibility, scalability, adaptability, and integration capability for renewable energy sources, with the perfect benefits of proton exchange membrane (PEM) and alkaline systems. Such technology is suitable for small-scale decentralized installations and industrial hydrogen production applications. Development in AEM, as an electrolyzer preferred technology, will also gain momentum with increased research and development to enhance the performance and durability of this technology.

By application, mobility is expected to be the largest segment during the forecast period

Electrolyzers for mobility dominate the market because green hydrogen is fast becoming popular as the clean fuel substitute for vehicles. Quicker refilling times, more range, and zero-emission options compared to battery electric vehicles make hydrogen-powered fuel cell vehicles—the kind that includes automobiles, buses, lorries, and trains—more commercially appealing. To de-carbonize the transportation sector, governments and entities globally have invested significantly in infrastructure for hydrogen refueling and provided incentives that encourage the adoption of hydrogen. Moreover, the versatility of electrolyzers in the on-site production of hydrogen for mobility purposes aligns well with the global shift toward clean and efficient means of transportation.

SECOND HIGHEST CAGR MARKET IN 2024-2030

GERMANY, FASTEST GROWING MARKET IN THE REGION

• In December 2023, John Cockerill entered the North American market with the groundbreaking of its first alkaline electrolyzer gigafactory in Baytown, Texas. The event was attended by Belgian Prime Minister Alexander De Croo, John Cockerill CEO François Michel, and President Americas Nicolas de Coignac, marking a significant milestone in the company’s US energy sector expansion.

• 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 February 2023, LONGi Hydrogen launched its ALK Hi1 electrolyzer, offering a high-efficiency solution for hydrogen production with energy consumption as low as 4.0 kWh/Nm³. This reduction in energy use significantly lowers the Levelized Cost of Hydrogen (LCOH), enhancing cost-effectiveness. The ALK Hi1 has been certified by DNV and DEKRA, setting new standards for energy efficiency in green hydrogen production. It can reduce initial equipment costs by up to 25%, positioning LONGi as a leader in affordable green hydrogen technology.

• 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.

What is the current size of the electrolyzers market?

What are the major drivers for the electrolyzers market?

Which is the largest market for electrolyzers during the forecasted period?

Which segment is expected to have the largest power rating in the electrolyzers market during the forecast period?

Which is expected to be the largest market by application for electrolyzers during the forecast period?

Data Triangulation

After arriving at the overall market size from the estimation process explained below, the total market has been split into several segments and subsegments. The data triangulation and market breakdown procedures have been employed, wherever applicable, to complete the overall market engineering process and arrive at the exact statistics for all the segments and subsegments. The data has been triangulated by studying various factors and trends from both the demand and supply sides.