The global water electrolysis market was valued at USD 6.18 billion in 2023 and is projected to register a compound annual growth rate (CAGR) of 7.9% from 2024 to 2030. This growth is primarily driven by a growing shift toward sustainability, as hydrogen gains prominence as a key component in future energy solutions. As industries increasingly explore hydrogen’s potential as a clean energy source, the demand for sustainable hydrogen production technologies continues to rise, spurring innovation and advancements in water electrolysis systems.

Additionally, stricter government regulations on fossil fuel use are expected to drive the adoption of water electrolysis technologies. With hydrogen being widely utilized, particularly in fuel cell applications, the need for efficient and eco-friendly hydrogen production methods is becoming critical. Water electrolysis presents a viable solution for large-scale, sustainable hydrogen generation, which is expected to enhance its market share over the forecast period.

Product Insights
In 2023, alkaline water electrolysis accounted for the largest market share, with 57.72% of total revenue. This dominance is attributed to the increasing global push for green hydrogen as part of carbon neutrality targets and the broader shift to renewable energy. Supportive policies and government-led initiatives promoting hydrogen energy are further bolstering demand for alkaline electrolysis systems.

The proton exchange membrane (PEM) segment is also witnessing significant growth due to its role in producing green hydrogen. PEM systems benefit from ongoing technological advancements that enhance efficiency and lower costs. The rising deployment of fuel-cell electric vehicles and the demand for reliable hydrogen supply further support the growth of this segment.

End-use Insights
The chemicals sector held the largest revenue share in 2023, at 41.52%. The increasing use of hydrogen as a key feedstock in chemical processes, such as ammonia and methanol production, drives this dominance. Growing emphasis on sustainable, carbon-free production methods is encouraging chemical manufacturers to adopt water electrolysis for hydrogen sourcing.

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Regional Insights
North America is projected to experience the fastest CAGR in the water electrolysis market through 2030. This growth is supported by favorable government incentives and policies aimed at integrating electrolysis technologies with renewable energy sources like wind and solar. Advancements in electrolyzer technologies—such as PEM and alkaline systems—are improving cost-efficiency and performance, making hydrogen production more scalable. The region’s broader energy transition strategy and emerging hydrogen economy further position North America as a key growth region.

Key Companies in the Water Electrolysis Market
The leading companies shaping the global water electrolysis market include:

• Nel ASA

• ThyssenKrupp AG

• Asahi Kasei Corporation

• Cummins Inc.

• Plug Power Inc.

• ITM Power PLC

• Toshiba Energy Systems & Solutions Corporation

• Teledyne Energy Systems Inc. Ltd.

• Hitachi Zosen Corporation

• Siemens Energy AG

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