The surge in demand for electric vehicles (EVs) has emerged as a key catalyst for the unprecedented growth of the hydrogen fuel cells market.
As per The Business Research Company's Hydrogen Fuel Cells Global Market Report 2023, the global hydrogen fuel cells market has experienced an extraordinary growth trajectory, with the market size expanding from $5.64 billion in 2022 to $8.23 billion in 2023, growing a CAGR of 45.8%. This upward trend is projected to continue, with the hydrogen fuel cells market size expected to reach $32.65 billion by 2027, growing at a CAGR of 41.1%, the report said.
EVs Fuel Growth
EVs have garnered immense popularity owing to their environmental benefits and reduced reliance on fossil fuels. Fuel cell electric vehicles (FCEVs), which employ fuel cell stacks to convert gaseous hydrogen into electricity, have positioned themselves as zero-emission vehicles (ZEVs). For instance, in 2022, the World Economic Forum reported a significant surge in battery-powered electric cars (BEVs) and plug-in hybrid electric vehicles (PHEVs) sales, with PHEV sales increasing by 37% and BEVs by 75% year-on-year in the first half of 2022. China, the world's largest auto market, is poised to lead the EV revolution, with projections indicating that 40% of cars sold in China by 2030 will be electric.
Major hydrogen fuel cell market players are at the forefront of innovation, continually developing new product solutions to solidify their market presence. For instance, in May 2023, the Tokyo Tech InfoSyEnergy Research and Education Consortium and the Tokyo Tech Academy of Energy and Informatics unveiled a groundbreaking fuel cell capable of generating electricity from hydrogen and waste plastic hydrogen, providing heat to industrial buildings. This innovative system, designed for commercial and industrial applications, boasts a 100 kW capacity.
Asia Pacific Leads The Pack
Asia Pacific claimed the top spot in the hydrogen fuel cells market in 2022, accounting for 46.3% of the global market share. North America followed closely behind. The fastest-growing regions in the hydrogen fuel cells market in the future are expected to be Asia Pacific and North America, the report noted.
The Asia Pacific market benefits from increasing demand for hydrogen fuel cells and robust Government initiatives to reduce greenhouse gas emissions. South Korea's Green New Deal, announced in July 2020, is a prime example, with the Government committing £13 billion ($16.54 billion) in fiscal investment by 2025 to support green mobility, including hydrogen vehicles. The country aims to produce approximately 500,000 hydrogen fuel cell vehicles for domestic and international markets by 2030, further bolstering market growth, the report added.
Courtesy: The Business Research Company. NB: Photo is representational; courtesy: Daimler Truck.