Global Hydrogen Review 2024

Hydrogen production

Highlights

  • Hydrogen production reached 97 Mt in 2023, of which less than 1% was low-emissions. Based on announced projects, low-emissions hydrogen could reach 49 Mtpa by 2030 (up from 38 Mtpa in the Global Hydrogen Review 2023).
  • Installed water electrolyser capacity reached 1.4 GW by the end of 2023 and could reach 5 GW by the end of 2024. China leads in terms of committed projects and could account for almost 70% of 2024 capacity. Announced projects suggests that capacity could grow to close to 520 GW by 2030, although only 4% has reached a final investment decision (FID) or is under construction. For fossil-based production with carbon capture, utilisation and storage (CCUS), 14% of the announced potential production has reached FID, boosted by an acceleration of FIDs in the last 12 months. Progress is being made, albeit far more slowly than was expected a few years ago.
  • Around 6.5 GW of electrolyser capacity reached FID in the past 12 months, nearly 12% less than in the 12 months prior to GHR 2023. More than 40% of this capacity is in China and 32% in Europe, where there was a four-fold increase compared to the previous 12 months. Committed projects are mainly in industry, or to produce hydrogen-based fuels for transport. On the other hand, several projects have been cancelled due to uncertainty about demand or regulations, financial hurdles, licencing and permitting issues.
  • Electrolyser manufacturing capacity doubled in 2023 to reach 25 GW/yr, with China accounting for 60%. This capacity is heavily underutilised, with only 2.5 GW of output in 2023. Considering projects with FID or under construction, capacity could reach more than 40 GW/yr in 2024. The project pipeline to 2030 adds up to more than 165 GW/yr, of which 30% has reached FID.
  • Producing renewable hydrogen today is generally one-and-a-half to six times more costly than unabated fossil-based production. This cost premium is much lower further down the value chain; for consumers, it typically represents only a few percentage points on final products (for example, it is around 1% for electric vehicles with steel produced using renewable hydrogen), but acceptance of higher prices varies by product.
  • Around 40% of planned low-emissions hydrogen production projects are in water-stressed regions, where using diverse sources of water and managing them sustainably will be crucial. Project developers are exploring large-scale desalination and treated wastewater to secure sufficient water supplies.
Next Trade and infrastructure