Global low-emissions hydrogen production could hit 37 million tonnes annually by 2030, the International Energy Agency (IEA) said Friday, warning growth has slowed from earlier projections.
The figure is down from 49 million tonnes estimated in 2024 from announced projects, according to the agency’s latest Global Hydrogen Review 2025.
Low-emissions hydrogen uptake has fallen short of targets set by industry and governments in recent years, according to the report.
High costs, weak demand, regulatory uncertainty and slow infrastructure development are restraining growth, with production projects particularly exposed, it added.
Worldwide hydrogen demand reached nearly 100 million tonnes in 2024, a 2% increase from the previous year and in line with overall energy demand growth.
Most supply came from hydrogen produced with fossil fuels without emissions controls, while oil refining and heavy industry remained the largest consumers.
The report noted that fossil-based hydrogen remains much cheaper to produce than low-emissions alternatives.
"The gap has widened lately due to recent declines in natural gas prices and an increase in the price of electrolysers due to inflation and slower-than-expected deployment of the technology," it said.
Still, the agency expects the cost gap to narrow by 2030 thanks to falling technology costs, rapid renewable energy growth in some regions, and new regulations.
Not all announced projects move forward, meaning actual capacity will likely be lower, but low-emissions hydrogen output is still set to expand sharply by the end of the decade, the report said.
Projects that are operating, under construction or backed by final investment decisions are on track to rise more than fivefold from 2024 levels to over 4 million tonnes a year by 2030, with another 6 million tonnes possible if stronger demand policies are put in place.
China is leading the rollout of electrolysers, accounting for 65% of global capacity that is installed or has reached a final investment decision, and nearly 60% of global manufacturing capacity.
Manufacturers elsewhere face rising costs and weak demand, while Chinese producers could also run into challenges as their annual production capacity of more than 20 gigawatts far exceeds current demand.
Commenting on the data, IEA Executive Director Fatih Birol said investor interest in hydrogen surged early this decade because of its potential to help countries meet their energy goals.
"The latest data indicates that the growth of new hydrogen technologies is under pressure due to economic headwinds and policy uncertainty, but we still see strong signs that their development is moving ahead globally," Birol said.
"To help growth continue, policy makers should maintain support schemes, use the tools they have to foster demand, and expedite the development of necessary infrastructure," he added.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr