Rethink Energy study: Green H2 is $850bn game everybody wants to play

According to a new study “Global Hydrogen Market Forecast to 2050,” published by Rethink Energy, the energy intelligence arm of Rethink Technology Research, the emergence of a global hydrogen marketplace of about six times the current market size now looks inevitable.

In the study, Rethink predicted that in 2050 the green hydrogen market will be valued at $850 billion and the world will have installed over 5 TW of electrolysis capacity, feeding multiple industries from ammonia to shipping fuel to fertilisers, heavy-duty trucking, aviation, steel making and both bio-fuel refining and methanol production.

All that will be achieved with the help of around 650 GW of electrolyser manufacturing capacity, built between now and 2050, Rethink noted, adding that by that time the electrolyser market will have made cumulative sales of $2 trillion which will represent quite a return on the cumulative investment of $111 billion required by all the electrolyser giga factories.

Rethink said that countries like the US, China, Australia, and Chile plus Europe and a few African countries will dominate global supply and contribute to bringing down the global average cost of production for green hydrogen to around $1.5/kg by 2050. In part, this is expected to be achieved due to an expected demand of 583 Mtons in 2050, split between biofuel refining, ammonia production, methanol production, road transportation, aviation and steel manufacturing among other smaller uses.

“Global Hydrogen Market Forecast to 2050” also predicts that every colour of hydrogen will play its part in sustaining the industry, as it scales, and high future costs of nuclear power and natural gas will ensure that green hydrogen will be the only colour left in play past 2039 when the entire industry will reach full sustainability.

The current thinking among H2 suppliers is that hydrogen will be a carbon copy of the LNG market, Rethink noted.

Bogdan Avramuta, Hydrogen Analyst at Rethink Energy and Lead Author of the report, stated: “The hydrogen industry is growing to the beat of the LNG market. Many fossil fuel companies are looking at copying everything from the LNG industry, from trading to shipping. Hydrogen will become the next LNG.”

“This is not to say that hydrogen will cover all the demand sectors that still rely on LNG, but rather it will amount to a considerable share of the global energy market as it will replace natural gas and oil (and coal) across multiple sectors.”