Increasing use of Hydrogen Electrolyzer to Solve Energy Management Issues

The demand for hydrogen in the industry is increasing. To satisfy the demand, gas reformation process is used, however, the biggest issue in this process is that it releases CO2. Hence, researchers found the new and eco-friendly method to produce hydrogen known as water electrolysis and in this new process, hydrogen is produced along with the oxygen from electrical current and water. Depending on the source of electricity used, hydrogen produced using electrolysis can lead to zero emission of greenhouse gas. Moreover, the industry is moving towards producing flexible and larger electrolyzers, accommodating hydrogen produced by solar.

Nel Hydrogen, a leading supplier of hydrogen generation plants based on electrolysis technology have already installed electrolyzers across the world and fueling stations. It is also planning to install electrolyzers in California. To produce hydrogen from a renewable source of energy, the company is using both solar and wind energy to have maximum electricity production.

According to the latest report by Future Market Insights (FMI), the global hydrogen electrolyzer market is expected to exceed $350 million value by 2027 end. It is also projected to register 7.0% CAGR during 2017-2027. The alkaline electrolyzer as the hydrogen electrolyzer product will remain dominant, reaching more than $190 million by 2027 end. While PEM electrolyzer is anticipated to witness high growth rate than solid oxide and alkaline electrolyzers. It is also poised to register 8.0% CAGR between 2017 and 2027. On basis of PEM electrolyzer, Western Europe is projected to reach $35.2 million market value. The region will be followed by the Middle East and Africa, APEJ and North America, in terms of PEM electrolyzer as the product type.

Hydrogen electrolyzer to solve energy storage and management problem

Hydrogen produced using electrolyzer that uses electricity to separate water into oxygen and hydrogen is being considered as the most emission-free way to produce energy. However, according to the Fuel Cell and Hydrogen Energy Association, less than 1% of electricity in the U.S. is generated using renewable sources of energy, the biggest reason for this is the cost. While exception of hydropower which is cost competitive. Moreover, electrolysis is emerging as the popular method to produce hydrogen.

However, the biggest challenge to set up mainstream electrolyzer is the high cost of electricity and capital cost. Hence, there is a need to reduce the cost of an electrolyzer in order to enable large scale implementation. Researchers are also focusing on integrating compression in the electrolyzer, eliminating the cost of separate hydrogen compressor to increase hydrogen storage pressure.

As per the fact sheet from Fuel Cell and Hydrogen Energy Association, in the near future, fossil fuels may be used to produce hydrogen in the U.S. However, government and industry are looking forward to producing hydrogen from renewable sources of energy.

Hydrogen storage system and plug-in electric vehicles containing electrolyzer, stored fuel cells and hydrogen tanks can offer flexibility to manage energy problem. According to the U.S. Energy Department, the industry is looking for the cost-effective way or process of producing hydrogen. The Energy Department expects that by 2020, hydrogen costs to fall below $4/gasoline gallon equivalent (the energy equivalent of a gallon of gasoline is 1kg of hydrogen). This will result in the hydrogen-fueled vehicle to be competitive on the basis of a cost-per mile with gasoline-fueled vehicles.

A sample of this report is available upon request @

By Nikhil Kaitwade

With over 8 years of experience in market research and consulting industry, Nikhil has worked on more than 250 research assignments pertaining to chemicals, materials and energy sector. He has worked directly with about 35 reputed companies as lead consultant for plant expansion, product positioning, capacity factor analysis, new market/segment exploration, export market opportunity evaluation and sourcing strategies.

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