The green hydrogen sector in Europe is growing due to increased investments in the development of renewable hydrogen generation by governments, energy firms, manufacturers and tech companies. Green hydrogen made through renewable energy-based electrolysis is gaining increasing importance in the refining industry, chemicals manufacturing, steel production, transportation and energy sectors as Europe strives for lower carbon footprint. Regulation, growth of renewable energy production, electrolyzer production growth, and need to cut emissions from the industries are driving growth in green hydrogen projects in Europe.
As per SNS Insider, the value of the Europe Green Hydrogen Market is expected to reach approximately USD 2.61 Billion in 2025 and further to approximately USD 60.68 Billion in 2035, growing at a CAGR of approximately 37.0% during 2026 to 2035. Worldwide, the value of the Green Hydrogen Market was estimated to be USD 10.02 billion in 2025 and is anticipated to be USD 201.07 billion in 2035, growing at a CAGR of 35.0%.
Gain Actionable Intelligence on the Green Hydrogen Market – Request a Free Sample Report
Why Europe Is a Key Green Hydrogen Growth Market
In terms of regions, Europe is forecasted to experience the maximum growth rate in the markets, due to the mandates of renewable hydrogen, carbon requirements, and REPowerEU. It is the above-mentioned reasons that have compelled industries to procure renewable hydrogen along with the installation of electrolysis and renewable electricity production equipment.
Germany possesses a market share of around 24.05% in Europe’s green hydrogen market value in 2025, owing to hydrogen demand in the industry sector and existing renewable energy infrastructure in Germany. Some other key players in the regional market include the UK and France.
Alkaline Electrolysis Remains the Leading Technology
Alkaline electrolyzers hold around 55.1% market share by installed capacity because of the proven stack technology and relatively cheap capital costs. Proven applications in refining, chemicals production, and power-to-hydrogen process continue driving installations of this electrolyzer for green hydrogen production on a commercial scale.
Among all the electrolyzers, the PEM electrolyzer is expected to register the fastest growth rate because of its quick response to changing renewable electricity generation. This makes the PEM electrolyzer fit for green hydrogen production powered by renewable wind and solar power.
Wind Energy Leads Renewable Hydrogen Production
Wind comprised about 47.8% of the share of green hydrogen in terms of sources in 2025, which is attributed to favorable electricity prices and existing renewable energy infrastructure within the hydrogen-producing areas.
The presence of substantial wind installations both offshore and onshore combined with increasing electrolyzer capacity ensures favorable conditions for hydrogen gas production in Europe. Moreover, solar energy becomes increasingly important due to decreasing costs of photovoltaics and hybrid renewable technologies that increase efficiency of electrolyzers and renewable electricity availability.
Industrial Decarbonization Is Expanding Hydrogen Demand
Refining accounted for around 35.5% of total market demand in 2025 and thus was the biggest end-user industry. Refineries have a history of using substantial amounts of hydrogen, which provides a stable demand foundation and allows the gradual shift from conventional hydrogen to green hydrogen.
Chemicals are likely to experience significant growth due to the rise in the number of green ammonia projects and applications of renewable chemical production. Another potential area is iron and steel production, where producers are exploring technologies to produce Direct Reduced Iron using renewable hydrogen.
Companies Supporting Europe’s Green Hydrogen Expansion
ITM Power plc
In 2025, ITM Power continued to make advancements towards the ability to produce their PEM electrolyzers, aiming at energy companies that require hydrogen production systems that will adapt according to the amount of electricity available. ITM Power’s investment in the PEM technology is in line with one of the most rapidly developing technologies in the green hydrogen industry. With more and more wind and solar power plants being developed across Europe, the demand for electrolyzers that adapt to fluctuating amounts of electricity is growing.
thyssenkrupp nucera AG & Co. KGaA
The thyssenkrupp nucera further increased its capacity to manufacture alkaline electrolyzers as it aimed at reaching larger industrial consumers interested in economically viable green hydrogen production technologies. The alkaline electrolysis continued to be the leading technology type in 2025 due to the availability of mature solutions and relatively attractive capex. By focusing on large industrial projects, the company positioned its electrolyzer technology in the European context of the wider use of renewable hydrogen by the already hydrogen-consuming sectors, such as chemicals and refining industries.
Linde plc
The company extended its large-scale production and liquefaction of green hydrogen in 2025 and focused on serving industries that need a stable supply of hydrogen for their refining and chemicals-related activities. It is because there has been growing commercial interest in the provision of hydrogen infrastructure not only for the production but also processing, liquefaction, storage, and supply for the industrial sector. The growing European manufacturers' interest in producing low-carbon hydrogen requires hydrogen capabilities for those customers who need stable supply of hydrogen.
Challenges Affecting European Green Hydrogen Development
The use of green hydrogen is still more costly compared to traditional gray hydrogen and poses a considerable challenge considering that purchase decisions are largely based on cost. Specialized infrastructure for the storage, transport, and distribution of hydrogen is required in order to make projects economically viable.
Therefore, reducing electrolyzer costs, ensuring access to renewable energy, and establishing industrial agreements will be important in making such projects more economical.
Europe Green Hydrogen Outlook Through 2035
The European hydrogen market is set to grow until 2035 due to increasing mandates on renewable hydrogen, decarbonization in industries, advancements in electrolyzers, and investments in renewable energy driving demand. Germany, the UK, France, and other big industrial nations will continue to be key regions.
The biggest opportunities can be expected in the refining industry, chemical industry, green ammonia production, and low carbon steel making as Europe evolves from projects to large-scale hydrogen use.
