Fuel Cell Market

[334 Pages Report] The global Fuel Cell Market is estimated to grow from USD 3.3 billion in 2023 to USD 8.7 billion by 2028; it is expected to record a CAGR of 21.7% during the forecast period. The favorable government policies and subsidies for research and development and applications such as fuel cell vehicles play a vital role in the growth of Fuel Cell market. Furthermore, Japan and South Korea are the prime country-level markets in Asia Pacific owing to the large commercialization of fuel cells in the regions.

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Fuel Cell Market Dynamics

Driver: Rise in the demand for fuel cell vehicles

Vehicle emissions account for more than 15% of worldwide greenhouse gas emissions. As a result, governments all over the world are looking for alternative energy sources to utilize in the transportation industry. The adoption rate for fuel cell vehicles (FCVs is expected to increase in the forecast period as there will be low CO2 emissions during vehicle operation. Hence, many key players are focusing on the investments and research & development of fuel cells. The EV30@30 campaign targets a minimum of 30% new electric vehicle sales by 2030. Under this campaign, several countries, such as Canada, Finland, France, Japan, Mexico, Netherlands, Norway, Sweden, and India, are gearing up the deployment of electric vehicles.

Fuel cell electric vehicles (FCEVs) can convert hydrogen stored on the vehicle via fuel cells into electricity to power the electric motor. The cost of owning and operating FCEVs is more than electric vehicles, due to high fuel and purchase prices. However, governments of various countries across the globe are deploying fuel cells powered public buses and garbage trucks as they are environment-friendly. FCEVs have been commercially available since 2014, and according to IEA, the number of FCEVs increased by 40% in 2020, with South Korea playing a major role in this increased percentage. Countries, such as Japan & China are increasing the number of hydrogen refueling stations, which in turn, is expected to drive the fuel cell market.

Restraint: Storage issues associated with using hydrogen as fuel

Storing hydrogen, especially in the transport sector for long ranges within the vehicular constraints of weight, volume, efficiency, safety, and cost, is one of the major restraints associated with fuel cells. Since hydrogen storage systems have high weight and volume, they cannot provide ranges as high as conventional petroleum-fueled vehicles. Moreover, the durability of hydrogen systems is also limited and there is a requirement to develop components and materials that can allow hydrogen storage systems with a lifetime of 1,500 cycles. Additionally, the refueling time associated with hydrogen storage is long and there is a need to develop systems that take less than 3 minutes for refueling.

Opportunities:  Increased adoption of fuel cells for backup power in data centers

Data centers and commercial & industrial end users are the fastest-growing end user segments for power generation applications in the US. Data Centers consume more power and uninterrupted power services, which will help to reduce the valuable data. Data centers are opting for cost reduction by adopting distributed power generation, particularly fuel cells, to reduce the power consumption in these centers. Fuel cells, including SOFCs, have witnessed high demand in the US. SOFC adoption for data centers by Google (US), IBM (US), and Equinix (US) has propelled the growth of the US fuel cell market. Currently, the overall fuel cell adoption by data centers is still minuscule with respect to the total data centers in the US, thus making it one of the most lucrative end-use segments for fuel cells. 

Challenges: Water management in proton exchange membrane fuel cells

In a PEM fuel cell, water is generated as chemical reactions occur in each cell. The balance of water in the fuel cell stacks is one of the greatest challenges associated with PEMFCs. Fuel cells tend to both flood or dry out depending upon the load and the operating conditions. The proton conductivity and activation potential in a PEMFC are affected by the water content in the polymer membrane. The protonic conductivity decreases if the membrane electrode assembly (MEA) is not adequately humidified, which in turn results in an increased cell resistance.

If the water removal in fuel cells is inefficient, the excess water can prevent reactant diffusion to the catalyst sites by flooding the electrodes, gas diffusion backings, or gas channels. Parameters, such as current density, temperature, reactant flow rates, pressures, humidification, cell design, and component materials need to be optimized to ensure the hydration of membranes. The humidification of reactant gas and cathode reaction in PEM fuel cells gives rise to water. This water buildup in a fuel cell can be mitigated through the gas diffusion layer, flow channel, or heater design. The correct balance of water can increase the efficiency and power output of the fuel cell and maintain the longevity of the fuel cell stack. Hence, water management is an important design consideration for a fuel cell stack.

Fuel Cell Market Ecosystem

Prominent companies in this market include well-established, financially stable Fuel Cell manufacturers. These companies have been operating in the market for several years and possess a diversified product portfolio, state-of-the-art technologies, and strong global sales and marketing networks. Prominent companies in this market include Bloom Energy (US), Doosan Fuel Cell Co., Ltd. (South Korea), Aisin Corporation (Japan), Plug Power Inc. (US), and KYOCERA Corporation (Japan).

The solid oxide fuel cell, by type, is expected to be the largest segment during the forecast period.

This report segments the fuel cell market based on type into six types: proton exchange membrane fuel cell, solid oxide fuel cell, phosphoric acid fuel cell, alkaline fuel cell, microbial fuel cell and direct methanol fuel cell. The solid oxide fuel cell segment is expected to be the largest segment during the forecast period. The compact structure of the solid oxide fuel cell needs a slower startup time, which is very important in stationary power applications. It is the most often used fuel cell type due to its simple construction. Proton exchange membrane fuel cell second largest segment in the fuel cell market. The increasing demand for fuel cell vehicles is the significant reason for the growth of proton exchange membrane fuel cells.

By end user, the commercial & industrial is expected to be the fastest growing during the forecast period.

Based on end-user, the fuel cell market is segmented into transportation, commercial & industrial, residential, data center, utilities and government/municipal institutes, and military & defense. The commercial & industrial will be the fastest growing market share during the forecast period. Commercial and industrial end users include hospitals, hotels, shopping center malls, office buildings, sports centers, and various other industrial facilities. All types of fuel cells such as proton exchange membranes, solid oxide, phosphoric acid fuel cells etc. are used in the commercial & industrial sectors for stationary application purposes. This will help the sector curb greenhouse gas emissions. The key players operating fuel cell market accommodate the fuel cell. For instance, TOSHIBA CORPORATION (Japan) has deployed the 'H2Rex' pure hydrogen fuel cell system at Toyota Motor Corporation's Honsha Plant. This system was constructed at the Hydrogen Power Generation Park, a demonstration site within the plant's on-site energy generation facility. H2Re is a 100 kW renewable energy system that uses hydrogen as a fuel to generate CO2-free electricity and can boot up and generate electricity in approximately five minutes.

"North America": The Second largest in the Fuel Cell market.

North America is expected to be the second largest market share in the Fuel Cell market during the forecast period, followed by Europe.  The DOE's Office of Fossil Energy funds the Solid-State Energy Conversion Alliance (SECA), which manages and organizes solid oxide fuel cell efforts. Between 2005 and 2015, the US federal government provided around USD 2.1 billion in funding for the development of fuel cell and hydrogen technology. Furthermore, there are deployment initiatives that have strong state support. In California, Connecticut, and other states, incentives are available through programs aimed at lowering greenhouse gas (GHG) emissions, enhancing power reliability, increasing energy efficiency, and decreasing consumer reliance on the electric grid. As a result of state regulations aimed at increasing renewable energy use, which will boost the fuel cell market in North America.

Key Market Players

The Fuel Cell market is dominated by a few major players that have a wide regional presence. The major players in the Fuel Cell market include Bloom Energy (US), Doosan Fuel Cell Co., Ltd. (South Korea), Aisin Corporation (Japan), Plug Power Inc. (US), and KYOCERA Corporation (Japan). Between 2018 and 2023, these companies followed strategies such as contracts, agreements, partnerships, mergers, acquisitions, and expansions to capture a larger share of the Fuel Cell market.

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Scope of the Report

This research report categorizes the fuel cell market by type, component, application, end user and region.

On the basis of type:

• Proton Exchange Membrane Fuel Cell
• Solid Oxide Fuel Cell
• Phosphoric Acid Fuel Cell
• Alkaline Fuel Cell
• Microbial Fuel Cell
• Others

On the basis of components:

• Stack
• Balance of plant (BOP)

On the basis of fuel:

• Hydrogen
• Ammonia
• Methanol
• Ethanol
• Hydrocarbon

On the basis of size:

• Small Scale
• Large Scale

On the basis of application:

• Portable
• Stationary
• Fuel Cell Vehicles
• Others

On the basis of end:

• Residential
• Commercial & Industrial
• Transportation
• Data Centers
• Military & Defense
• Utilities & Government/Municipal Institutes

On the basis of region:

• Asia Pacific
• Europe
• North America
• Rest of the World

Recent Developments

• In October 2023, TECO 2030 developed hydrogen fuel cells that enable ships and other heavy-duty applications to become emissions-free. TECO 2030’s world-class fuel cell system is a technologically advanced clean energy generation system. The attributes of the modular 400kW fuel cell system include industry leading energy efficiency, inherent safety concept, leading dimensions and component design, lifetime, and rapid dynamic load response.
• In June 2023, Bloom Energy agreed to deploy 2.5 megawatts (MW) of Bloom's Fuel Cell technology in England with Perenco, an independent oil and gas firm.
• In May 2023, Ballard Power Systems has recently received an order for 3.6 MW of fuel cell systems from a European company specializing in clean energy solutions for essential stationary power needs. The order entails delivering 36 x 100 kW systems throughout 2023 and 2024.
• In January 2023, Ballard Power Systems has recently disclosed an order for a fuel cell system to be utilized in the Hollandse Kust Noord offshore wind project by CrossWind, a joint venture between Shell and Eneco. The Hollandse Kust Noord offshore wind project, situated off the coast of the Netherlands, is projected to have a capacity of 759 MW, generating a minimum of 3.3 TWh annually. Ballard's fuel cell system will be integrated into the project to support its operations.
• In February 2022, Doosan Fuel Cell Co., Ltd., Korea Shipbuilding & Offshore Engineering (KSOE), and Shell with reference to development in September 2021 signed a letter of intent to start commercial marine fuel cell systems production by 2025. Doosan Fuel Cell Co., Ltd. will complete its marine fuel cell systems and get the systems marine certified by 2024, with the commercialization of the systems scheduled for 2025.

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