PEM Electrolyzer Market

Global PEM Electrolyzer Market Size (2024 to 2029)

As per our analysis report, the global PEM Electrolyzer market is expected to reach USD 1.25 billion by 2029 from USD 0.24 billion in 2024, growing at a compound annual growth rate (CAGR) of 38.21% during the forecast period.

Current Scenario of the Global PEM Electrolyzer Market

The global proton exchange membrane (PEM) market has had prominent growth in the past years and is anticipated to have notable growth during the forecast period. An electrolyzer consists of a conductive electrode stack separated by a membrane, where the high voltage and current are applied to the electrode. The water's electric current causes water molecules to break down into separate components, hydrogen and oxygen. In the proton exchange membrane (PEM) electrolysis process, the cell is equipped with a solid polymer electrolyte responsible for the conduction of protons and the separation of product gases. The growing demand for hydrogen production, which can be used in various industries, is a significant factor contributing to the market growth, leading to enhanced demand for PEM electrolyzers.   

MARKET DRIVERS

The growing demand for hydrogen utilization in various industrial sectors significantly contributes to global market growth.

Various industries use PEM electrolyzers as a crucial technology for various applications such as metal refining, chemical production, and electronics manufacturing, propelling the global market growth. The growing adoption of sustainable and eco-friendly industrial processes is enhancing the demand for PEM Electrolyzers. The rising government initiatives to reduce greenhouse gas emissions are escalating the adoption of various eco-friendly and sustainable solutions for energy production, which will multiply the growth opportunities for the PEM Electrolyzer market. Most of the market players focus on reducing their carbon footprint by attaining sustainable options, which is estimated to positively influence the market growth rate.

The surge in demand for fuel cell electric vehicles is another factor propelling the global PEM electrolyzers market growth.

The growing use of green hydrogen for fuel cell electric vehicles is accelerating the demand for proton exchange membrane electrolyzers in the industry, which is contributing to the growth of the global market. Increasing government investments and advancements in fuel cell technology are driving the market revenue growth. The growing research and developmental activities and the rising technological advancements of proton exchange membrane electrolyzers will provide market growth opportunities during the forecast period. Researchers are exploring various key components such as membranes, catalysts, and bipolar plates to enhance the performance and durability of the electrolyzers, creating market growth opportunities.  

MARKET RESTRAINTS

The shortage of iridium is majorly hampering the growth of the global PEM electrolyzer market.

The iridium plays a crucial role in the PEM electrolysis as an anode where the increased demand for clean hydrogen will impact due to its reliance on precious catalyst material like iridium. The limited availability of iridium worldwide will act as a significant hurdle to market growth. Another factor is the high costs associated with the proton exchange electrolyzers, which involve complex engineering and specialized materials, hindering the market growth opportunities. The high equipment cost will restrict access to small-scale industries, limiting market expansion. The increased initial costs may prevent investors and companies from entering the market, which impedes market growth. Other drawbacks, such as limited durability and high thickness of the proton exchange membrane, causing resistance to proton flow, are estimated to restrain the adoption, leading to restricted market growth. The stringent regulations regarding the approval of innovations in the product and the safety and efficacy of the electrolyzer will act as challenges for manufacturers in expanding the market.

REPORT COVERAGE

SEGMENTAL ANALYSIS

Global PEM Electrolyzer Market Analysis By Capacity

The > 500 kW – 2MW segment dominated the global PEM Electrolyzer market revenue with the largest share in 2023. These systems widely use large amounts of water as the primary feedstock for hydrogen generation and are widely used on-site across various industries, which include glass, metal, food and beverages, transportation, and chemicals, which is escalating the segment growth. Factors such as flexibility in delivery contracts, affordability, energy-efficient processes with compact and modular design, and reduced harmful emissions enhance the segment's growth.

The less than 500kW segment is estimated to grow prominently during the forecast period. The increased usage of these electrolyzers in low-power applications in small buildings, plants, and industrial applications is escalating the segment's demand.

Global PEM Electrolyzer Market Analysis By Application

The power generation segment is expected to dominate the global PEM Electrolyzer market and is expected to maintain the highest CAGR during the forecast period. Due to enhanced demand for clean energy sources, the growing demand for electrolyzers in the power production industry propels the segment's growth. Hydrogen is reducing the carbon footprint compared to other sources, accelerating the demand for electrolysis-produced hydrogen, becoming an alternative to traditional power sources, and fueling the segment revenue. The rising trend of replacing fossil fuels with hydrogen due to water reuse is boosting the segment growth rate.

The Industrial energy segment held the second-largest share of global market revenue due to the increased installation of electrolyzers on plant premises or in businesses to generate energy for manufacturing and production.

Global PEM Electrolyzer Market Analysis By Material Type

The platinum segment held the dominant share in the global market and is expected to maintain the domination in the coming years. The proton exchange membrane technology uses platinum catalysts to produce electricity, which fuels the segment's growth. The platinum material helps produce efficient energy, and longer stability and durability are major factors enhancing the adoption and leading to segment growth.  

The iridium segment is estimated to have rapid growth during the forecast period due to affordability and efficiency.

REGIONAL ANALYSIS

The North American region held the most significant share of the global PEM Electrolyzer market revenue.

The United States dominated the regional market due to increased demand for hydrogen in industrial sectors. The rising use of hydrogen in refining, petrochemicals, glass purification, and fertilizers is augmenting industrial applications, accelerating demand for PEM electrolyzers, and leading to regional growth. The growing government support and initiatives for utilizing clean energy sources to reduce the carbon footprint are escalating regional market share growth.

The European region held the second-largest share in the global PEM electrolyzer market due to enhanced funding and support for hydrogen-related projects.

The growing investments by private and public organizations in the development of hydrogen infrastructure augment the market growth in the European region. The shifting towards sustainable transport infrastructure with increased investments in the hydrogen development industry will positively influence the regional market growth.

Asia Pacific region is expected to increase rapidly during the forecast period with a significant growth rate.

The surging renewable energy integration, growing investments, and accelerating hydrogen infrastructure development propel regional market growth. The increasing demand for renewable energy sources is fueling the regional market growth. According to carbon analytics, in 2022, the Asian region will have the most significant growth capacity at around 35% per year. This accelerates the demand for PEM Electrolyzers in the region and leads to an enhanced growth rate.    

KEY PLAYERS IN THE GLOBAL PEM ELECTROLYZER MARKET

Air Liquide, Air Products and Chemicals Inc., Erre Due s.p.a, Elogen, Siemens Energy, Proton On-Site, Cummins Inc., Plug Power Inc.,  Proton On-Site, Kobelco Eco-Solutions are some of the notable companies in the global PEM Electrolyzer market.

RECENT HAPPENINGS IN THE MARKET

• In November 2023, Siemens Energy, in collaboration with Air Liquide, started its new gigawatt-scale plant in Berlin to produce highly efficient electrolyzer modules. This plant uses robotics and automation to produce PEM electrolyzers. The major aim of the project is to manufacture low-carbon hydrogen with a limited budget by boosting innovations in Europe.
• In October 2023, John Cockerill acquired manufacturing space in Texas for a gigafactory, through which it expanded its operations to the US hydrogen market. The built facility is expected to produce 1GW per year.
• In June 2023, thyssenkrupp nucera and Unipar collaborates to incorporate thyssenkrupp nucera electrolyzers in Unipar’s plant in Brazil.
• In March 2022, Elogen received an order of 1 MW proton exchange membrane (PEM) electrolyzer from Communauté d’Agglomération Pau Béarn Pyrénées. Elogen designed and produced this PEM Electrolyzer and delivered it to the Lescar wastewater treatment site in the first half of 2023.
• In July 2022, Plug Power Inc. signed an agreement with Irving Oil, an International energy company, to supply a 5-megawatt containerized proton exchange membrane (PEM) electrolyzer system for the production and distribution of hydrogen at its Saint John, New Brunswick refinery in Canada.   

DETAILED SEGMENTATION OF THE GLOBAL PEM ELECTROLYZER MARKET INCLUDED IN THIS REPORT

This research report on the global pem electrolyzer market has been segmented and sub-segmented based on capacity, application, material type, and region.

By Capacity

• < 500 kW
• > 500 kW – 2MW
• Above 2MW

By Application

• Power Generation
• Transportation
• Industrial Energy
• Industry Feedstock
• Building Heating & Power
• Others

By Material Type

• Iridium
• Platinum
• Others

By Region

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East and Africa