MENA Hydrogen Electrolyzer Market Analysis and Forecast to 2040: By Type (Proton Exchange Membrane (PEM) Electrolyzer, Alkaline Electrolyzer, Solid Oxide Electrolyzer), Capacity (Below 500 kW, 500 kW - 2 MW, Above 2 MW), End-Use (Ammonia, Methanol, Refini

MENA Hydrogen Electrolyzer Market Analysis and Forecast to 2040: By Type (Proton Exchange Membrane (PEM) Electrolyzer, Alkaline Electrolyzer, Solid Oxide Electrolyzer), Capacity (Below 500 kW, 500 kW - 2 MW, Above 2 MW), End-Use (Ammonia, Methanol, Refining/Hydrocarbon, Transport, Others), and Country

The MENA hydrogen electrolyzer market was valued at US$ 35.24 million in 2021 and it is anticipated to grow up to US$ 6,491.98 million by 2040, at a CAGR of 30.08% during the forecast period.

A hydrogen electrolyzer is an apparatus that produces hydrogen through a chemical process (electrolysis) capable of separating the hydrogen and oxygen molecules of which water is composed using electricity. Through electrolysis, the hydrogen electrolyzer system creates hydrogen gas. The oxygen left over is released into the atmosphere or can be captured or stored to supply other industrial processes or even medical gases in some cases. The hydrogen gas can either be stored as a compressed gas or liquefied since hydrogen is an energy carrier and can be used to power any hydrogen fuel cell electric end user, such as trains, buses, and trucks.

In general, an electrolyzer contains a cathode (negative charge), an anode (positive charge), and a membrane. The system also contains pumps, vents, storage tanks, a power supply, a separator, and other components. Water electrolysis is an electrochemical reaction that takes place within the cell stacks. Electricity is applied to the anode and cathode across the membrane and causes the water to split into its component molecules, hydrogen and oxygen. Hydrogen produced in this sustainable way, without emitting carbon dioxide into the atmosphere, can be the basis for a decarbonized economy.

Market Drivers and Trends
The automotive and transportation sector is experiencing high technological advancement due to various attempts that governments make to reduce carbon emissions from vehicles. For instance, in December 2019, Volkswagen announced plans to reduce the average emissions of its new vehicles by 30% by 2025 and aim to be carbon neutral by 2050. Due to technological advancement in the automotive sector, innovative hydrogen fuel stations are rapidly developing across the MENA region. For instance, in August 2021, according to the article published by the Petrol Plaza, PowerTap Hydrogen Fueling Corp. planned to deploy a minimum of 100 hydrogen fueling stations with multiple Middle Eastern governments and private and public multinational corporations over the next two years, subject to completing the manufacturing of a prototype dispensing unit and successful testing. Additionally, with only two hydrogen fueling stations across the UAE, PowerTap targets to develop a hydrogen highway utilizing many of the country’s 643 fueling stations. Further, hydrogen fuel cell vehicles use a propulsion system similar to that of electric vehicles, where energy stored as hydrogen is converted to electricity by the fuel cell. Unlike conventional internal combustion engine vehicles, these hydrogen fuel cell vehicles produce no harmful tailpipe emissions. Thus, it helps increase the demand for hydrogen in fuel cell-based vehicles across the MENA region. Therefore, increasing demand for vehicles operated with the help of hydrogen fuel cells has proved to be a major driving force for the market. The dependency on traditional fuels has reduced comparatively, which has proved to be a major growth factor for the market. People are switching to fuel cell vehicles instead of gasoline-based machines, which is helping the market record a considerable revenue over time.
Market Restraints and Challenges
Hydrogen can be produced using multiple technologies, including electrolysis, thermochemical, photolytic, and biological processes. The electrolysis-based hydrogen generation process faces stiff competition from other alternative processes, especially thermochemical processes, as electrolysis only accounts for one-twenty-fifth of the overall sources of hydrogen generation. Major thermochemical processes include natural gas reforming/SMR, coal gasification, and biomass gasification. SMR (steam-methane reforming) is one of the most popular technologies for hydrogen generation and uses high-temperature steam to produce hydrogen from natural gas, a methane source. However, these technologies have the potential for sustainable hydrogen production and low emissions. Therefore, the presence of mature and cost-efficient alternative hydrogen production technologies may hinder the market's growth during the forecast period.

MENA Hydrogen Electrolyzer Market Segmental Overview
The report analyses the MENA hydrogen electrolyzer market based on type, capacity, end-use, and country.

MENA Hydrogen Electrolyzer Market by Type

Based on type, the MENA hydrogen electrolyzer market is segmented into proton exchange membrane (PEM) electrolyzer, alkaline electrolyzer, and solid oxide electrolyzer. The alkaline electrolyzer segment is anticipated to account for largest market share in 2021, and proton exchange membrane (PEM) electrolyzer segment is expected to be the fastest-growing segment during the forecast period. Alkaline electrolyzers are significantly less expensive than PEM electrolyzers. As a result, this type of electrolyzer is commonly used for on-site hydrogen production. The main benefit of alkaline electrolyzers is that they can sustain greater megawatt (MW) range stacks, resulting in increased capacity and a more stable working environment for hydrogen electrolyzers. Demand for these systems is rapidly increasing due to their longer durability. It is extensively used in many industrial applications, such as electronics & photovoltaics of plastics, power-producing plants, and steel manufacturing units.

MENA Hydrogen Electrolyzer Market by Capacity

On the basis of capacity, the MENA hydrogen electrolyzer market is segmented into below 500 kW, 500 kW - 2 MW, and above 2 MW. The below 500 kW segment is anticipated to account for the largest market share in 2021, and above 2 MW segment is expected to be the fastest-growing segment during the forecast period. Hydrogen electrolyzers having a capacity below 500 kW are typically utilized in places with low demand for power and in small buildings, plants, and industrial facilities. Moreover, hydrogen electrolyzers range in size from small (below 500 kW) appliance-size equipment that is well-suited for small-scale distributed hydrogen production. Most announced projects range below 500 kW in size and are close to industrial sites and ports. These small projects limit the production of green hydrogen. Further, in November 2021, according to the article published by the African Business, Egypt which intends to reach 42% of renewable share in its energy mix by 2035 has signed a few Memorandum of Understanding with the Egyptian Electricity Holding Company (EEHC) to jointly develop a pilot project, compromising 100 to 200 MW of electrolyser capacity.

MENA Hydrogen Electrolyzer Market by End-Use

Based on end-use, the MENA hydrogen electrolyzer market is segmented into ammonia, methanol, refining/hydrocarbon, transport, and others. The ammonia segment is anticipated to account for largest market share in 2021, and transport segment is expected to be the fastest-growing segment during the forecast period. Ammonia, a compound made of nitrogen and hydrogen, is extensively used in the chemical sector. Currently, most of the hydrogen feedstock for ammonia is mainly natural gas-based which the renewable-based electrolysis process can replace to form green ammonia.

Country-wise Analysis of MENA Hydrogen Electrolyzer Market

Country-wise, the market is analyzed across the UAE, Saudi Arabia, Morocco, Egypt, Qatar, Kuwait, Oman, and Rest of MENA. The Rest of MENA country was the highest revenue-generating country in 2021, and the UAE is projected to exhibit the highest CAGR throughout the study period. By 2050, Africa might account for up to 10% of the worldwide demand for green hydrogen. By the mid-century, the continent might exploit its plentiful sun and wind resources to manufacture 30 million to 60 million tonnes per annum (mtpa) of green hydrogen. It might become the world's most cost-effective source of green hydrogen by 2030, with predicted costs ranging from US$ 1.80/kg to US$ 2.60/kg by 2030 but reducing to US$ 1.20/kg to 1.60/kg by 2050. Renewables will require US$ 320 billion to US$ 610 billion in investment, whereas electrolysis units will require US$ 115 billion to US$ 220 billion. The Sahara desert in North Africa has long been hailed for its ability to create enormous amounts of renewable energy due to its dry environment and vast stretches of land. For years, Europeans, in particular, have seen it as a possible source of solar energy capable of meeting a significant portion of Europe's energy demands.

Major Players in the MENA Hydrogen Electrolyzer Market
The key players studied in the MENA hydrogen electrolyzer market are Nel Hydrogen, John Cockerill, Plug Power, Cavendish Renewable Technology, Siemens Energy (Siemens AG), Air Liquide, thyssenkrupp nucera, Asahi Kasei, Cummins (Hydrogenics), and Linde plc.
COVID-19 Impact
In the pre-COVID-19 pandemic scenario, the production and use of low-carbon forms of hydrogen had gained unprecedented momentum. Hydrogen fuel-cell vehicle sales accelerated impressively in 2019, and the early 2020s were expected to be record years for the deployment of electrolyzer capacity, according to the IEA report on The Covid-19 Crisis and Clean Energy Progress, in June 2020. Secondly, before the COVID-19 pandemic, the sharp drop in oil and gas prices that began in 2015 fostered MENA green hydrocarbon producers to launch ambitious economic reform programs in all countries. Moreover, before the COVID-19 pandemic, progress in clean energy technologies had been promising. Thus, the pre-COVID-19 pandemic positively impacted the MENA hydrogen electrolyzer market.

The outbreak of the COVID-19 pandemic led to a decline in the demand for hydrogen electrolyzers across the MENA region. The outbreak of COVID-19 posed certain challenges for the MENA hydrogen electrolyzers market in 2020. Repeated nationwide curfews and shutdowns continue to hamper or even halt the movement of raw materials and completed goods, causing manufacturers to suffer. Manufacturing and distribution issues were likely the most visible disturbances to all types of chemical markets. The shutdown of most industries also disrupted supply chains. Metallurgical processes were halted either due to weak demand for end products or workforce unavailability. Such factors reduced the demand for hydrogen used in several industrial processes, thereby negatively affecting the MENA hydrogen electrolyzers market as they are primarily used in hydrogen generation. Further, all current hydrogen demand is in oil refining, the chemical sector, and steel manufacturing, all of which have been highly impacted by the COVID-19 outbreak. Several governments have taken multiple steps to ensure the availability of raw materials by keeping track of the supply and demand of intermediate goods for producing hydrogen. Alongside this, various countries' governments are also providing subsidies for raw materials, supporting domestic producers with short-term loans to assist small and medium enterprises (SMEs) and local manufacturers engaged in hydrogen generation. Therefore, the overall impact of the COVID-19 pandemic on the MENA hydrogen electrolyzer market was negative.

In the post-COVID-19 pandemic scenario, rising concerns about climate change would encourage the use of clean energy across the MENA region, supporting the demand for and use of hydrogen electrolyzers. Policy support for clean hydrogen has grown in recent years, bolstered by post–COVID-19 recovery spending. Clean-hydrogen-focused companies are raising more money than ever. The annual investment in clean hydrogen now stands at half a billion dollars yearly, according to the IEA report on Global Hydrogen Review 2022. Moreover, the rise in investment in green hydrogen projects after the COVID-19 pandemic has boosted market growth. For instance, Egypt, the host of the COP27 climate change summit, has attracted investment pledges of more than US$ 40 billion in 2022 alone for green hydrogen and green ammonia projects, according to the International Monetary Fund (IMF) data of December 2022. No continent has a better technical potential for producing cheap green hydrogen than Africa. Hence, the MENA hydrogen electrolyzer market in focus is anticipated to show significant growth during the forecast period.
Recent Developments

August 2022, Nel has decided to build a new fully automated production line at Herøya in Norway, doubling its capacity for production of alkaline electrolyzer stacks to ~1 GW. The growing demand for green hydrogen needs more electrolyzers and in order to match the supply Nel has increasing its production sites.
July 2022, Linde has signed a Memorandum of Understanding (MOU) with the Ministry of Energy and Infrastructure of the United Arab Emirates to explore and develop projects that will contribute to the MOEI's Energy Strategy 2050 and the UAE Net Zero Initiative to achieve net-zero emissions by 2050.
March 2021, VINCI Energies Deutschland Industry & Infrastructure GmbH and Enapter GmbH have signed a collaboration agreement. Enapter's AEM Multicore large-scale hydrogen facilities will be deployed and distributed by VINCI Energies. The collaboration will last at least five years. The collaboration's aim is to create hydrogen facilities that fulfil the industry's performance and cost criteria. Enapter will supply AEM Multicore electrolyzers capable of producing roughly 450 kilos of green hydrogen per day as part of this agreement. VINCI Energies in Germany plans to integrate the AEM Multicore into green hydrogen production facilities for clients and run these on-site as needed.

MENA Hydrogen Electrolyzer Market Segmentation
By Type

Proton Exchange Membrane (PEM) Electrolyzer
Alkaline Electrolyzer
Solid Oxide Electrolyzer

By Capacity

Below 500 kW
500 kW - 2 MW
Above 2 MW

By End-Use

Ammonia
Methanol
Refining/Hydrocarbon
Transport
Others

By Country

UAE
Saudi Arabia
Morocco
Egypt
Qatar
Kuwait
Oman
Rest of MENA

Key Players

Nel Hydrogen
John Cockerill
Plug Power
Cavendish Renewable Technology
Siemens Energy (Siemens AG)
Air Liquide
thyssenkrupp nucera
Asahi Kasei
Cummins (Hydrogenics)
Linde plc

Frequently Asked Questions
Q1. How big is the MENA hydrogen electrolyzer market?

Ans. The MENA hydrogen electrolyzer market size was US$ 35.24 million in 2021 and is anticipated to reach US$ 6,491.98 million in 2040, growing at a rate of 30.08% from 2022 to 2040.

Q2. What is the MENA hydrogen electrolyzer market growth rate?

Ans. The growth rate of the MENA hydrogen electrolyzer market is 30.08% from 2022 to 2040.

Q3. Which country holds a major market share for the MENA hydrogen electrolyzer market?

Ans. Rest of MENA holds a major market share of the MENA hydrogen electrolyzer market in 2021.

Q4. Which segment accounted for the largest MENA hydrogen electrolyzer market share?

Ans. Based on end-use, the MENA hydrogen electrolyzer market is segmented into ammonia, methanol, refining/hydrocarbon, transport, and others. The ammonia segment is anticipated to account for largest market share in 2021, and transport segment is expected to be the fastest-growing segment during the forecast period.

Q5. Who are the key players in the MENA hydrogen electrolyzer market?

Ans. The key players studied in the MENA hydrogen electrolyzer market are Nel Hydrogen, John Cockerill, Plug Power, Cavendish Renewable Technology, Siemens Energy (Siemens AG), Air Liquide, thyssenkrupp nucera, Asahi Kasei, Cummins (Hydrogenics), and Linde plc.

Q6. What are the factors driving the MENA hydrogen electrolyzer market growth?

Ans. The major factor driving the growth of the market is surging demand for hydrogen in fuel cell-based vehicles.

Q7. What are the key growth strategies of MENA hydrogen electrolyzer market players?

Ans. The key growth strategies of MENA hydrogen electrolyzer market players are product launch, partnerships, and government initiatives.

Q8. Which country will provide more business opportunities for the MENA hydrogen electrolyzer market during the forecast period?

Ans. The Rest of MENA country will provide more business opportunities for the MENA hydrogen electrolyzer market during the forecast period.