Hydrogen market growth to surge in 2023 despite slowing global economy

Hydrogen development, given its application across various industries, is indispensable to attaining energy transition, meeting decarbonisation goals, and positioning leading companies as market experts. Against this backdrop, hydrogen production capacity is estimated to reach 4.5 million tons per annum (mtpa) worldwide by the end of the year, representing 165% growth compared to 2022, says GlobalData, the data and analytics company.

GlobalData’s recent publication Hydrogen Transition Outlook and Trends: Q1 2023, highlights deals trends and investments as useful benchmarks to identify those leading companies driving the hydrogen market growth.

Andres Angulo, Energy Analyst at GlobalData, comments: “During 2022, over 393 deals related to hydrogen were closed, representing a significant increase compared to 277 deals registered in 2021. This shows an upward trend in the hydrogen market development, which could be decisive in achieving over 71 mtpa capacity worldwide by 2030. However, the partnerships represented 66% of the deals last year, and the number of deals decreased after Q2 2022 to numbers even below those seen in the same quarter in 2021. This could have been due to the companies trying to strengthen their core business and diversify the investment risk given the global economic situation.”

Despite the high number of partnerships formed between companies as compared to government agencies, investing and raising capital was of utmost importance to develop the hydrogen economy in 2022. Last year, the merger and acquisitions (M&A) deals reached $24.4 billion in monetary value, representing a 288% increase compared to 2021 levels. On the other hand, venture finance deal values also grew from $595.23 million to over $3,001.1 million.

In 2022, over 111.9 mtpa hydrogen capacity was announced in the US, Denmark, Egypt, Canada, Portugal and other countries. In Canada, Green Hydrogen International (GHI) announced two important green hydrogen projects as a sole participant, with 43 mtpa capacity each, which are expected to begin production in 2030. Some other companies took part in multiple project investments globally to diversify their risk, including Fortescue Industries, which has two-thirds of its capacity outside its home country, Australia.