Grey Hydrogen Market Research Report By Production Method (Steam Methane Reforming, Coal Gasification, Biomass Gasification, Electrolysis), By End-Use Sector (Transportation, Industrial, Power Generation, Residential), By Storage and Transportation Method (Pipelines, Compressed Hydrogen, Liquid Hydrogen), By Hydrogen Purity (Low purity (95%), Medium purity (95-99%), High purity (99% or higher)), By Source of Hydrogen (Fossil fuels, Renewable energy, Nuclear energy) and By Regional (North America, Europe, South America, Asia Pacific, Middle

Global Grey Hydrogen Market Overview

As per MRFR analysis, the Grey Hydrogen Market Size was estimated at 196.3 (USD Billion) in 2022. The Grey Hydrogen Market Industry is expected to grow from 207.99(USD Billion) in 2023 to 350.0 (USD Billion) by 2032. The Grey Hydrogen Market CAGR (growth rate) is expected to be around 5.96% during the forecast period (2024 - 2032).

Key Grey Hydrogen Market Trends Highlighted

The cost of grey hydrogen makes it a cheaper alternative to other methods of producing hydrogen, and its global market is predicted to grow significantly in the future. Grey hydrogen is produced from natural gas through steam reforming and carbon dioxide by-product is emitted during the process. This has raised environmental concerns, but since grey hydrogen can be produced at a low cost, many industries are attracted to it.

Driving factors behind gray hydrogen include increasing demand for clean fuel in transport, power generation and industrial processes. Rising energy prices, government incentives and increased attention to decarbonization further contribute to market growth. Moreover, a reduction in the environmental impact of gray hydrogen production by means of the development of carbon capture and utilization technologies will create new prospects for its application.

Some recent trends in gray hydrogen market are the use of hydrogen in fuel cell vehicles, hydrogen-powered turbine development and growing interest in hydrogen for off-grid applications and remote areas as a possible source of energy.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Grey Hydrogen Market Drivers

Rising Demand for Clean Energy Sources

The escalating concerns over climate change and the depletion of fossil fuels have spurred the need for sustainable energy alternatives. Grey hydrogen, being a low-carbon fuel, presents itself as a viable option to meet the growing demand for clean energy. Its potential to reduce greenhouse gas emissions, particularly in sectors that heavily rely on fossil fuels, is driving its market growth. Governments worldwide are implementing supportive policies and regulations to promote the adoption of grey hydrogen as a sustainable energy source, further fueling market expansion.

Technological Advancements and Cost Reductions

The continuous advancements in grey hydrogen production technologies have led to improved efficiency and reduced production costs. The development of innovative electrolysis methods, such as alkaline and proton exchange membrane (PEM) electrolysis, has enhanced hydrogen yield and lowered energy consumption. Additionally, the economies of scale achieved through large-scale production facilities have contributed to cost reductions, making grey hydrogen more competitive in the energy market.

Government Incentives and Support

Governments across the globe are recognizing the potential of grey hydrogen in decarbonizing various industries and achieving climate goals. They are introducing favorable policies, including tax incentives, subsidies, and research and development funding, to encourage the adoption of grey hydrogen technologies. These incentives provide financial support to companies investing in grey hydrogen projects, stimulating market growth and accelerating the transition to a low-carbon economy.

Grey Hydrogen Market Segment Insights

Grey Hydrogen Market Production Method Insights

Steam Methane Reforming (SMR) dominated the Grey Hydrogen Market in 2023, accounting for nearly 80% of the market revenue. SMR is a well-established technology that has been used for decades to produce hydrogen from natural gas. Coal Gasification is another significant production method, accounting for approximately 15% of the Grey Hydrogen Market share. Coal gasification involves converting coal into hydrogen-rich syngas, which can then be used to produce hydrogen. Biomass Gasification is a relatively new production method that has gained traction in recent years due to its environmental benefits.Biomass gasification involves converting biomass, such as wood or agricultural residues, into hydrogen-rich syngas. Electrolysis is a process that uses electricity to split water into hydrogen and oxygen. This growth is being driven by the increasing demand for hydrogen as a clean fuel and feedstock. Hydrogen is used in a variety of applications, including power generation, transportation, and industrial processes. The Grey Hydrogen Market is highly fragmented, with a large number of small and medium-sized producers. The top five producers account for less than 25% of the global market share.The market is expected to consolidate over the next few years as larger producers acquire smaller players. The Grey Hydrogen Market is expected to face challenges in the coming years. These challenges include the high cost of production, the lack of a developed hydrogen infrastructure, and competition from other low-carbon fuels. However, the market is expected to continue to grow as governments and businesses around the world invest in hydrogen technologies.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Grey Hydrogen Market End-Use Sector Insights

The end-use sector segmentation of the Grey Hydrogen Market provides insights into the diverse applications of grey hydrogen across various industries. The transportation sector is projected to account for a significant share of the market in 2023, driven by the growing demand for clean fuels in the automotive industry. Industrial applications, such as refineries and chemical plants, are also expected to contribute substantially to the market's growth. Power generation is another major end-use sector, with grey hydrogen being utilized as a fuel source in power plants.The residential sector is expected to have a moderate share of the market, primarily used for heating and cooking purposes. Overall, the Grey Hydrogen Market is poised for robust growth in the coming years, with each end-use sector playing a crucial role in driving market expansion.

Grey Hydrogen Market Storage and Transportation Method Insights

Storage and Transportation Method The Grey Hydrogen Market is segmented based on storage and transportation method into pipelines, compressed hydrogen, and liquid hydrogen. Among these, the pipelines segment is expected to hold the largest market share during the forecast period. This is attributed to the fact that pipelines are the most cost-effective and efficient way to transport hydrogen over long distances. Pipelines can also be used to store hydrogen for long periods of time. The compressed hydrogen segment is expected to witness significant growth during the forecast period.This is due to the increasing popularity of hydrogen-powered vehicles. Compressed hydrogen can be stored in tanks on vehicles and used to power the vehicle's engine. The liquid hydrogen segment is expected to account for a small share of the Grey Hydrogen Market during the forecast period. This is due to the high cost of liquefying hydrogen. However, liquid hydrogen is the most energy-dense form of hydrogen and can be stored for long periods of time.

Grey Hydrogen Market Hydrogen Purity Insights

The Grey Hydrogen Market is segmented by Hydrogen Purity into Low purity (95%), Medium purity (95-99%), and High purity (99% or higher). Among these segments, the high purity segment is expected to hold the largest market share in 2023, accounting for around 60% of the Grey Hydrogen Market revenue. This is due to the increasing demand for high-purity grey hydrogen in various industries, including electronics, chemicals, and pharmaceuticals. The medium purity segment is expected to witness significant growth over the forecast period, owing to its increasing adoption in power generation and transportation applications.The low purity segment is expected to hold a relatively smaller market share, primarily due to its limited applications. However, the growing demand for grey hydrogen in the steel industry is expected to drive the growth of this segment in the coming years.

Grey Hydrogen Market Source of Hydrogen Insights

The source of hydrogen plays a crucial role in determining the environmental impact and cost-effectiveness of grey hydrogen production. The three main sources of hydrogen for grey hydrogen production are fossil fuels, renewable energy, and nuclear energy. Fossil fuels, primarily natural gas, account for the majority of grey hydrogen production globally. In 2023, fossil fuels accounted for approximately 95% of the global grey hydrogen production. However, the use of fossil fuels for hydrogen production is associated with high carbon emissions, contributing to climate change.Renewable energy sources, such as solar and wind power, offer a sustainable alternative for grey hydrogen production. Electrolysis powered by renewable energy can produce hydrogen without greenhouse gas emissions. The Grey Hydrogen Market revenue from renewable energy sources is projected to grow significantly in the coming years, driven by increasing concerns about climate change and the falling costs of renewable energy. Nuclear energy is another potential source of hydrogen for grey hydrogen production. Nuclear power plants can generate large amounts of heat, which can be used to drive thermochemical water-splitting processes to produce hydrogen.The Grey Hydrogen Market segmentation data shows that nuclear energy currently accounts for a small share of grey hydrogen production, but it has the potential to play a larger role in the future as nuclear power becomes more widely adopted. The choice of hydrogen source depends on factors such as availability, cost, and environmental impact. As the world transitions towards a low-carbon economy, renewable energy sources are expected to become increasingly important for grey hydrogen production, reducing the carbon footprint and contributing to sustainable development.

Grey Hydrogen Market Regional Insights

The regional segmentation of the Grey Hydrogen Market offers insights into the market's geographic distribution and performance. North America is projected to dominate the market, driven by increasing demand for clean energy sources and government initiatives to promote hydrogen production. Europe is expected to witness steady growth due to stringent environmental regulations and a focus on decarbonization. APAC is anticipated to be a significant growth region, with China leading the market due to its ambitious hydrogen economy plans. South America and MEA are expected to contribute to the market's expansion, but their growth may be influenced by factors such as infrastructure development and government policies.This growth is attributed to increasing investments in hydrogen production and transportation infrastructure, as well as supportive government policies and regulations.

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Grey Hydrogen Market Key Players And Competitive Insights

Major players in the Grey Hydrogen Market industry are investing heavily in research and development to improve the efficiency and cost-effectiveness of grey hydrogen production. Leading Grey Hydrogen Market players are also forming partnerships and collaborations to strengthen their market position and gain access to new technologies. The Grey Hydrogen Market development is being driven by the growing demand for low-carbon energy sources. Governments and industries are increasingly recognizing the potential of grey hydrogen as a clean and sustainable alternative to fossil fuels. This has led to the establishment of supportive policies and incentives, which are further driving the growth of the Grey Hydrogen Market. The competitive landscape is expected to remain intense in the coming years, with major players focusing on innovation, cost optimization, and strategic alliances.Linde is a leading global industrial gases and engineering company. The company has a strong presence in the Grey Hydrogen Market, with a focus on the production, distribution, and storage of hydrogen. Linde has invested heavily in research and development to improve the efficiency of its hydrogen production processes. The company has also developed a number of innovative technologies for the storage and transportation of hydrogen.Air Products Chemicals is another major player in the Grey Hydrogen Market. The company has a global presence and is a leading supplier of hydrogen to a variety of industries. Air Products Chemicals has invested in the development of new hydrogen production technologies, including a proprietary steam reforming process. The company is also focused on the development of hydrogen-based transportation solutions.

Key Companies in the Grey Hydrogen Market Include

• Praxair


• Showa Denko


• Linde


• Taiyo Nippon Sanso


• Iwatani


• Air Products and Chemicals


• Messer


• Siemens


• Toshiba


• BASF


• Air Liquide


• Hexagon Composites


• GE Power


• Plug Power


• Nel Hydrogen

Grey Hydrogen Market Industry Developments

The Grey Hydrogen Market is projected to reach USD 350.0 billion by 2032, exhibiting a CAGR of 5.96% during the forecast period (2024-2032). Increasing demand for clean energy sources and government initiatives to reduce carbon emissions are driving the market growth. Moreover, the rising adoption of grey hydrogen in industries such as refining, chemicals, and steel manufacturing is further contributing to the market expansion. Recent developments include the launch of new grey hydrogen production facilities and strategic partnerships between key players to expand production capacity and meet the growing demand. The market is also witnessing technological advancements, such as the development of more efficient and cost-effective grey hydrogen production methods, which are expected to further drive market growth in the coming years.

Grey Hydrogen Market Segmentation Insights

• Grey Hydrogen Market Production Method Outlook
  
  
  
  • Steam Methane Reforming
  
  
  • Coal Gasification
  
  
  • Biomass Gasification
  
  
  • Electrolysis
  
  
  
  

• Grey Hydrogen Market End-Use Sector Outlook
  
  
  
  • Transportation
  
  
  • Industrial
  
  
  • Power Generation
  
  
  • Residential
  
  
  
  

• Grey Hydrogen Market Storage and Transportation Method Outlook
  
  
  
  • Pipelines
  
  
  • Compressed Hydrogen
  
  
  • Liquid Hydrogen
  
  
  
  

• Grey Hydrogen Market Hydrogen Purity Outlook
  
  
  
  • Low purity (95%)
  
  
  • Medium purity (95-99%)
  
  
  • High purity (99% or higher)
  
  
  
  

• Grey Hydrogen Market Source of Hydrogen Outlook
  
  
  
  • Fossil fuels
  
  
  • Renewable energy
  
  
  • Nuclear energy
  
  
  
  

• Grey Hydrogen Market Regional Outlook
  
  
  
  • North America
  
  
  • Europe
  
  
  • South America
  
  
  • Asia Pacific
  
  
  • Middle East and Africa