Brown Hydrogen Market Forecasts to 2030 – Global Analysis By Technology (Coal Gasification with Carbon Capture Storage, Coal Gasification without Carbon Capture Storage, Steam Methane Reforming, Hydrogen Purification and Other Technologies), End User (Ref

Brown Hydrogen Market Forecasts to 2030 – Global Analysis By Technology (Coal Gasification with Carbon Capture Storage, Coal Gasification without Carbon Capture Storage, Steam Methane Reforming, Hydrogen Purification and Other Technologies), End User (Refining, Chemicals, Iron and Steel, Power Generation, Transportation and Other End Users) and By Geography

According to Stratistics MRC, the Global Brown Hydrogen Market is accounted for $36.93 billion in 2023 and is expected to reach $58.15 billion by 2030 growing at a CAGR of 6.7% during the forecast period. Brown hydrogen is created using the coal gasification process. Coal is changed from a solid to a gas during coal gasification. When coal is gasified, its chemical components are separated out, producing methane gas. Following isolation, the gas can be conventionally cleaned to recover hydrogen and a stream of highly concentrated carbon dioxide before being transported for disposal.

According to IEA, refining and chemical manufacturing based on hydrogen derived from fossil fuels are already concentrated in coastal industrial zones worldwide, such as the North Sea in Europe, the Gulf Coast in North America, and south-eastern China. Overall expenses would be reduced if these plants were encouraged to switch to cleaner hydrogen generation.

Market Dynamics

Driver

Increasing energy demand and the multifaceted role of hydrogen

A significant factor driving the brown hydrogen market is the rising demand for hydrogen on a global scale as an energy carrier and an essential element in industrial processes in the petrochemicals, refining, and transportation sectors. Moreover, this increase in demand is a result of industries turning to hydrogen to improve process efficiency, cut emissions, and meet strict quality standards. At the same time, it is accelerating the shift to hydrogen-powered transportation options, highlighting hydrogen's critical role in the changing energy landscape.

Restraint

Technologies in competition and clean hydrogen

Cleaner hydrogen production processes, like those that produce blue and green hydrogen, compete with brown hydrogen. While green hydrogen is produced through electrolysis powered by renewable energy with no carbon emissions, blue hydrogen is produced from fossil fuels with CCS and has a lower carbon footprint than brown hydrogen. Additionally, the sustainability of the brown hydrogen market is threatened by the emergence and expansion of these cleaner substitutes.

Opportunity

Advances in carbon capture and storage

The development of CCS technologies for the production of brown hydrogen offers hope for more extensive carbon capture and storage applications across industries. Innovations that lower costs, boost efficiency, and encourage global emissions reduction can result from investments in CCS. Furthermore, the creation and uptake of advanced CCS solutions can be sped up through research partnerships, industry alliances, and financial incentives from the government.

Threat

Environmental issues and goals for reducing emissions

The brown hydrogen production industry's environmental impact continues to pose a serious threat as countries step up their efforts to combat climate change. Even with the use of CCS technology, the carbon dioxide (CO2) emissions caused by brown hydrogen may not be in line with long-term emission reduction goals. Moreover, brown hydrogen's continued development may be hampered by regulatory restrictions and shifting public opinion about the environmental effects of the fuel.

Covid-19 Impact

The COVID-19 pandemic had a wide range of effects on the market for brown hydrogen. Construction projects and supply chains were initially disrupted, which resulted in delays and cost overruns. However, as governments all over the world place a higher priority on economic recovery, a growing understanding of brown hydrogen's potential to promote job creation and support struggling industries has emerged. This resulted in increased financial support and legislative backing for brown hydrogen initiatives, particularly those connected to carbon capture and storage (CCS) technologies. The transition to cleaner energy sources was also accelerated by the pandemic, which led some stakeholders to re-evaluate the function of brown hydrogen in light of more ambitious emission reduction goals and the growing competition from green and blue hydrogen.

The Steam Methane Reforming segment is expected to be the largest during the forecast period

The largest market share for hydrogen production is anticipated to belong to the steam methane reforming (SMR) segment. A tried-and-true and frequently applied technique for producing hydrogen is steam methane reforming. It entails the interaction of natural gas (methane) and extremely hot steam, which results in the production of hydrogen gas and carbon dioxide as byproducts. Moreover, SMR is preferred because it is effective and costs less than some alternative methods. But it's important to remember that even though SMR is a popular technique, there is a growing focus on lowering carbon emissions, which has raised interest in carbon capture and storage (CCS) technologies to reduce the CO2 emissions connected with SMR.

The power generation segment is expected to have the highest CAGR during the forecast period

Throughout the forecast period, the power generation segment is anticipated to have the highest CAGR. Hydrogen power generation is gaining popularity as a clean, efficient alternative to conventional electricity generation from fossil fuels. Hydrogen is a crucial component in the switch to clean energy because it can be used in fuel cells and gas turbines to generate electricity with no carbon emissions. Incorporating hydrogen into their energy mix and looking into opportunities for grid stabilization and energy storage, governments and utilities are investing more and more in projects that produce hydrogen power. Power generation using hydrogen is anticipated to continue growing, supporting a resilient and sustainable energy future as the global push for renewable and low-carbon energy sources increases.

Region with largest share

The Asia-Pacific region had the largest market share for brown hydrogen. This region, especially nations like China, Australia, and Japan, has been heavily investing in carbon capture and storage (CCS) and brown hydrogen production technologies. Due to its large coal reserves and dedication to hydrogen as part of its energy transition strategy, China, in particular, was a significant player. Additionally, in order to diversify their energy sources and support their economies, Japan and Australia were also investing a sizable amount of money in brown hydrogen projects.

Region with highest CAGR

During the forecast period, the brown hydrogen market is expected to grow at the highest CAGR in the European region. Europe had outlined ambitious hydrogen strategies and had been actively pursuing hydrogen as a key component of its clean energy transition. Brown hydrogen projects were being funded in nations like Germany, the Netherlands, and the United Kingdom, frequently in conjunction with carbon capture and storage (CCS) technologies. Moreover, the need to de-carbonize heavy industry, including steel and chemicals, where brown hydrogen could play a key role, motivated these initiatives. High growth for brown hydrogen was anticipated in Europe due to the region's strong commitment to achieving carbon neutrality and the development of hydrogen infrastructure.

Key players in the market

Some of the key players in Brown Hydrogen Market include Shell Japan Limited , China Petrochemical Corporation., PetroChina Company Limited , Saudi Arabian Oil Co., Air Liquide S.A., J-Power Systems, Electric Power Development Co. Limited , Iwatani Corporation, Bloom Energy Corporation, Air Products Inc., Kawasaki Heavy Industries, Limited, Sinopec Limited and Sasol Limited.

Key Developments

In September 2023, ADNOC Gas plc has announced an agreement valued between US$450-550mn to supply LNG to PetroChina International Company Limited, a subsidiary of PetroChina Company Limited. This agreement follows several significant international LNG sales agreements, including those with Japan Petroleum Exploration Co., Ltd. (JAPEX), TotalEnergies Gas and Power, and India Oil Corporation (IOCL).

In June 2023, Japan Airlines (JAL) has signed a Memorandum of Understanding (MoU) with Shell Aviation, which will see JAL aircraft refuelled at Los Angeles International Airport (LAX) with sustainable aviation fuel (SAF) from 2025.The agreement supports JAL’s ESG target of replacing 1% of its whole jet fuel amount with SAF in the 2025 fiscal year, set in its green transformation policy.

In June 2023, Air Liquide has signed a long-term Power Purchase Agreement (PPA) with the China Three Gorges Renewables and China Three Gorges Corporation Jiangsu Branch, subsidiaries of China Three Gorges, one of China’s largest producers and retailers of renewable electricity, to purchase a total of 200 MW of renewable power per year in China. The renewable electricity will come from solar and wind farms located in the province of Jiangsu, which is the first province in China for Air Liquide in terms of electricity consumption.

Technologies Covered
• Coal Gasification with Carbon Capture Storage
• Coal Gasification without Carbon Capture Storage
• Steam Methane Reforming
• Hydrogen Purification
• Other Technologies

End Users Covered
• Refining
• Chemicals
• Iron and Steel
• Power Generation
• Transportation
• Other End Users

Regions Covered
• North America
US
Canada
Mexico
• Europe
Germany
UK
Italy
France
Spain
Rest of Europe
• Asia Pacific
Japan
China
India
Australia
New Zealand
South Korea
Rest of Asia Pacific
• South America
Argentina
Brazil
Chile
Rest of South America
• Middle East & Africa
Saudi Arabia
UAE
Qatar
South Africa
Rest of Middle East & Africa

What our report offers
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2021, 2022, 2023, 2026, and 2030
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements