Chapter 2

2022 Hydrogen Supply Capacity and

Demand
March 2022

FUEL CELLS AND HYDROGEN OBSERVATORY

Disclaimer

This report is based on data gathered for the Fuel Cells and Hydrogen Observatory by March 2022. The
data aim to reflect the situation in hydrogen supply and demand as of the end of 2020.1 The authors
believe that this information comes from reliable sources, but do not guarantee the accuracy or
completion of this information. The Observatory and information gathered within it will continue to be
revised. These revisions will take place annually and can also be done on a case-by-case basis. As a
result, the information used as of writing of this report might differ from the changing data in the
Observatory.

The information and views set out in this report are those of the author(s) and do not necessarily reflect
the official opinion of the Clean Hydrogen JU. Neither the Clean Hydrogen JU, other European Union
institutions and bodies, nor any person acting on their behalf may be held responsible for the use which
may be made of the information contained therein.

This report was prepared for the Clean Hydrogen Joint Undertaking as part of the Fuel Cells and
Hydrogen Observatory. Copies of this document can be downloaded from
https://www.fchobservatory.eu/

The Fuel Cells and Hydrogen Observatory has been prepared for the Clean Hydrogen JU under a public
procurement contract.

©Clean Hydrogen JU, 2022 Reproduction is authorised provided that the source is acknowledged. For
any use or reproduction of material that is not under the Clean Hydrogen JU copyright, permission must
be sought directly from the copyright holders

1
The data only reflects end of 2020 as some of the sources did not have 2021 data available during the data collection process.

1
TABLE OF CONTENTS
Disclaimer ................................................................................................................................................ 1
Executive Summary ................................................................................................................................. 3
1. Hydrogen production capacity ........................................................................................................ 5
1.1. Summary ................................................................................................................................. 5
1.2. Captive production .................................................................................................................. 7

1.2.1. Refining ........................................................................................................................... 8

1.2.2. Ammonia ....................................................................................................................... 10
1.2.3. Other captive hydrogen production plants ................................................................... 12
1.3. Merchant hydrogen production ............................................................................................ 13
1.4. By-product hydrogen production .......................................................................................... 15
1.5. Clean hydrogen production capacity ..................................................................................... 17
2. Demand for hydrogen ................................................................................................................... 19
2.1. Summary ............................................................................................................................... 19
2.2. Refining industry ................................................................................................................... 20
2.3. Chemical industry .................................................................................................................. 21
2.4. Other industries..................................................................................................................... 24
3. Conclusion ..................................................................................................................................... 26
4. Appendix 1: List of Acronyms ........................................................................................................ 27
5. Appendix 2: References ................................................................................................................. 28

2
Executive Summary

Purpose: The purpose of the hydrogen supply and demand data stream is to provide an
overview of the hydrogen market in Europe and to track industry’s progress in
deploying clean hydrogen technologies.

Scope: Data about hydrogen production capacity and consumption in EU countries, together
with Switzerland, Norway, Iceland, and the United Kingdom. Hydrogen production
capacity is presented by country and by production technology, whereas the
hydrogen consumption data is presented by country and by end-use sector. The
analysis undertaken for this report was completed using data reflecting end of 2020.

Key Findings: The current hydrogen market (on both the demand and supply side) is dominated by
refining and ammonia industries with four countries (DE, NL, PL, ES) responsible for
more than half of hydrogen consumption. Hydrogen is overwhelmingly produced by
reforming of fossil fuels (mostly natural gas). Clean hydrogen production capacities
are currently insignificant with hydrogen produced from natural gas coupled with
carbon capture at 0.42% and hydrogen produced from water electrolysis at 0.14% of
total production capacity.

Total hydrogen production capacity in the included countries at the end of 2020 has been estimated at
30,927 tonnes per day or 11.4 Mt per year. If by-product hydrogen from coke oven gas is included the
total is 33,026 tonnes per day which equates to 12.2 Mt per year. The corresponding consumption of
hydrogen has been estimated at 8.6 Mt (341 TWhHHV), which means an average capacity utilization of
76%.

The biggest share of hydrogen demand comes from refineries, which were responsible for 50% of total
hydrogen use, followed by the ammonia industry with 29%. Together these two sectors consumed
almost 4/5 of total hydrogen consumption in the covered European countries. About 12% was
consumed by the chemical industry including methanol production constituting 5%. Emerging hydrogen
applications, like the transportation sector remained steady consuming only 0.02% of the total.

On-site captive hydrogen production was by far the most common method of hydrogen supply,
comprising 25,105 tonnes per day (81%) of all hydrogen production capacity with merchant production
of 3,575 tonnes per day (12%) and by-product production of 2,203 tonnes per day (7%).2

Germany was, by a significant margin, the largest European market for hydrogen, with 19% of total
European hydrogen production capacity and 20% of total demand. Together with the Netherlands,
Poland, and Spain, these four countries were responsible for 51% of the hydrogen demand and 48% of
production capacity.3

2 Excluding by-product hydrogen in coke oven gas

3
Excluding by-product hydrogen in coke oven gas

3
Figure 1: Total hydrogen production capacity and consumption by country in 2020
Source: Fuel Cells and Hydrogen Observatory

Demand
32%

31% 20%
19%

Production
5.9% capacity
6.0% 13%
6.9%
7.2%
6.4% 7.3% 10% 15%

6.0%
5.6% 9%

Other Germany Netherlands Poland France Italy Spain United Kingdom

The most common method of producing hydrogen is steam reforming of natural gas (SMR). Less
common are partial oxidation (POX) and autothermal reforming (ATR). SMR and natural gas are widely
used for all applications including oil refining, ammonia synthesis, or any other bulk hydrogen
production. Even though natural gas is the most common feedstock, steam reforming is also used with
other feedstocks, which include also liquid hydrocarbons like LPG or naphtha.

Out of the 338 identified hydrogen production plants which were using fossil fuels as feedstock, only
three were using carbon capture technologies:

• Grupo Sappio hydrogen production unit in Mantova, Italy with a capacity of around 1,500 Nm3/h
that started operating in 2016.

• Air Liquide Cryocap installation in Port Jerome, France, capturing CO2 from hydrogen supplied to an
Exxon refinery, with a capacity of around 50,000 Nm3/h that started operating in 2015.

• Shell refinery in Rotterdam, Netherlands where CO2 from hydrogen production is captured and sold
for agricultural use as part of the OCAP project since 2004.

Total share of hydrogen production from fossil fuels with CCS/CCU was approximately 131 tonnes per
day equating to 0.42% of the total hydrogen generation capacity.4

By the end of 2020, the authors identified and track 114 operational power-to-hydrogen (water
electrolytic) projects in EU, EFTA, and UK. Total power of the electrolysers from those 114 projects was
99 MW equalling to hydrogen generation capacity of ~44 t of electrolytic hydrogen per day (0.14% of
total production capacity). This represents an 11% increase in operational power-to-hydrogen capacity
between 2019 and 2020 caused by 19 new projects adding 7 MW of capacity. Compared to 2018, it
represents a 31% increase in capacity over two years. Electrolyzer deployment is increasing rapidly with
approximately 36 MW of new electrolyzer capacity being expected to have been deployed in 2021.

4
Excluding by-product hydrogen in coke oven gas

4
1. Hydrogen production capacity
1.1. Summary
The assessment of hydrogen production capacity in EU, EFTA, and UK builds on work completed by the
Roads2HyCom project and ongoing work by the Hydrogen Analysis Resource Centre (HyARC). The
annual updates capture closing and new facilities as well as further specify and improve on the collected
information by contacting asset owners, industry associations, and statistical offices.5 Results of this
data collection include 535 hydrogen production sites, which have been categorised by:

- type of production (captive, merchant, by-product);

- technology;
- application (only for captive hydrogen production capacity);
- country.

The hydrogen production plants have been divided into three main categories: captive production
facilities6, merchant production facilities7, and plants where production of hydrogen is a by-product of
other processes. It should be noted though, that in some cases, the boundaries between different
hydrogen streams are extremely blurry. The reason is that in many cases many types of installations
are clustered within the same area and it is not uncommon for an industrial park to contain all three
types of installations. In this case, the flow of hydrogen between installations is more a result of current
capacity utilization than a fixed design and can therefore change over time. For example, a captive
hydrogen generation unit (HGU) can be used to supply hydrogen to merchant companies during times
when it is underutilized for its primary purpose. As a result, the amount of hydrogen that can be used
for merchant supply from excess hydrogen from captive industries, varies depending on the actual
demand for hydrogen from its primary use.

For the purpose of this analysis the authors defined the boundaries between the three hydrogen
production types as follows:

5 The hydrogen supply capacity market is largely stable so differences compared to previous years primarily reflect methodological
changes as well as continuously improving accuracy of the supply capacity data rather than market trends. The methodological changes
compared to the September 2021 report include classifying by-product hydrogen production capacity in refineries as captive and reducing
the potential of hydrogen production capacity from coke production. In terms of improving data accuracy, the most significant
improvement occurred in the production capacities in refineries which lead to a significant increase in captive refining production capacity.
6 On-site production of hydrogen for own consumption.
7
Hydrogen production dedicated for sales.

5
Figure 2: Definition of hydrogen production types by availability
Source: Author’s own elaboration

Where:

1. Captive hydrogen production on-site used exclusively for own consumption within the
same facility.8
2. Excess hydrogen production capacity in dedicated installations, that can be valorised and
sold to external hydrogen merchant companies for resale. This has been applied only to
installations, which are dedicated to supply hydrogen merchants.
3. Hydrogen produced in large industrial installations usually dedicated to serve a single
customer or an industrial cluster. Usually produced in close vicinity or distributed with
pipelines. Whenever it was possible to verify that the installation was serving a single
customer those installations were categorised as captive. In other cases, they were
categorised as merchant.
4. Hydrogen produced for retail purposes and sold in relatively small volumes, that does not
warrant building its own HGU. Usually distributed in compressed form, in cylinders or using
tube trailers (200 bar), in few cases liquefied, also mostly using trucks.
5. By-product hydrogen that is vented to the atmosphere or used as feedstock for internal
processes or for on-site energy generation.9
6. By-product hydrogen that is purified and sold to merchants for further resale.
7. By-product hydrogen that is sold directly to nearby captive industry.

Total hydrogen production capacity in the covered European countries at the end of 2020 has been
estimated at 33,026 tonnes per day. Excluding coke oven gas hydrogen, the remaining capacity is
30,927 t per day.

Seventy six percent (76%) of all hydrogen production capacity was designated for captive production.
In reality it is even more than that, as a large portion of the merchant plants are dedicated entirely to
supplying large industrial customers on-site, with only a small proportion of production capacity

8 Hydrogen produced during various refining processes and used onsite is considered captive in our methodology
9
Hydrogen produced during various refining processes and used onsite is an exception and is considered captive in our methodology

6
available to supply the wider market. By-product hydrogen provides 13% of total hydrogen production
capacity, of which 49% is hydrogen from coke oven gas.10

Figure 3: Structure of hydrogen production capacity

Source: Fuel Cells and Hydrogen Observatory

Refining
COG
11%
7%
23% 13% Ammonia
Ethylene and 45%
styrene 38% 55%
76% Methanol and
32%
Chlor-alkali and other
sodium chlorate chemicals
Captive By-Product Merchant

With almost 6,323 t per day (19% of total), Germany has by far the largest hydrogen production capacity
from among the analysed countries. The Netherlands follows with 4,336 t per day (13% of total. Other
countries with significant hydrogen production capacity are Poland (3,166 t per day, 10%), France
(2,425, 7%), Italy (2,379, 7%), Spain (2,283, 7%), and United Kingdom (1,968, 6%).11

Figure 4: Total hydrogen production capacity by country

Source: Fuel Cells and Hydrogen Observatory

Captive By-Product Merchant

7,000
6,000
Tonnes per day

5,000
4,000
3,000
2,000
1,000
0
Iceland
France
Italy

Norway

Romania
Netherlands

Hungary

Finland
Austria
Germany

Poland

Spain

Greece

Denmark
Bulgaria

Croatia

Ireland
Belgium

Slovakia
Lithuania

Switzerland

Slovenia
Sweden

Czechia
Portugal
United Kingdom

1.2. Captive production

On-site captive hydrogen production is by far the most common method of hydrogen supply for large
hydrogen consumers. These include refineries as well as ammonia, methanol, and hydrogen peroxide
production plants. In all those cases, the high volume of hydrogen consumed, justifies the investment
in a dedicated HGU. The predominant technology for this type of installations is hydrocarbon reforming
– mostly steam methane reforming (SMR). The capacity numbers in this section also include by-product

10 The total by-product capacity has decreased from 26% to 13% compared to the September 2021 report due to two methodological
changes. Identified by-product hydrogen production capacity in refineries was moved from the by-product section to the captive section
and hydrogen production capacity from coke production was reduced from 450 to 207 Nm3 H2/t of product.
11
Numbers include by-product hydrogen in coke oven gas

7
hydrogen production capacity at refineries. Hydrogen is produced at refineries as a by-product of
different refining processes. Since it is mostly used on-site, it methodologically belongs to captive
production.

1.2.1. Refining

The total captive hydrogen production capacity installed at refineries (excluding merchant plants, even
if dedicated to supply hydrogen to refineries) is approximately 13,886 t per day split between 92
facilities.12

Germany has the largest share with 15% of total EU, EFTA, and UK hydrogen production capacity in
refineries, followed by the Netherlands (11%), Italy (10%), Spain, (9%), Poland (8%), and the United
Kingdom (7%).

The oil refining sector is the biggest hydrogen producer and consumer in the EU. Hydrogen in refineries
is used for the purpose of hydrotreating and hydrocracking processes. Hydrotreatment is one of the
key stages of the diesel refining process and relates to several processes such as hydrogenation,
hydrodesulphurization, hydrodenitrification, and hydrodemetalization. Hydrocracking involves the
transformation of long and unsaturated products into products with a lower molecular weight than the
feed.

Hydrocracking is by far the most common hydrogen consuming process, needing around 300 Nm3 H2/t
of product. Hydrotreating processes usually require only around 20-50 Nm3 H2/t of product. It is also
important to note that refineries not only consume but also produce hydrogen at various stages of
crude oil refining, with the most hydrogen yield being generated during catalytic reformulation which
produces hydrogen at a rate of 200 Nm3 H2/t crude oil13.

The volume of production can be substantial to the point that refineries that do not use hydrocracking
can be self-sufficient in terms of hydrogen consumption and do not require any additional dedicated
hydrogen production.

All large EU refineries use fossil fuels (most commonly natural gas) as a feedstock to produce hydrogen
through one of the following processes:

• steam reforming or autothermal reforming of light ends or natural gas;

• partial oxidation (gasification) of heavy oil fractions;
• reforming processes which produce hydrogen as a by-product.

Refineries with the simplest configuration may produce enough hydrogen only through catalytic
reforming. Complex plants with extensive hydrotreating and/or hydrocracking operations typically
require more hydrogen than is produced by their catalytic reforming units and it is those refineries that
have dedicated HGU’s. The feed of the hydrogen plant consists of hydrocarbons in the range from
natural gas to heavy residue oils and coke. The conventional steam reforming process produces a

12 While the identified production capacities change and become more accurate every year, the increase from last year’s number of 9,376
t/d is mostly due to a change in methodology. In the report published in September 2021, the known volumes of hydrogen produced in
refineries as a by-product of catalytic reforming or other processes were included in the by-product section. This report includes that
capacity here in the captive section because while those hydrogen volumes are produced as a by-product, they are consumed on site as
other captive production.
13 G. Maisonnier, J. Perrin, R. Steinberger-Wilckens y S. C. Trümper, «European Hydrogen Infrastructure Atlas” and “Industrial Excess

Hydrogen Analysis”,» Roads2HyCom, 2007. < https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.477.3069&rep=rep1&type=pdf

>

8
hydrogen product of a maximum of 97 – 98 % v/v purity and higher if a purification process is applied
(99.9 – 99.999 % v/v).14

Figure 5: Captive hydrogen production installations for refining

Source: Fuel Cells and Hydrogen Observatory

14
P. Barthe, M. Chaugny y L. Serge Roudier, «Best Available Techniques (BAT) Reference Document for the Refining of Mineral Oil and
Gas,» JRC, 2015. <https://publications.jrc.ec.europa.eu/repository/handle/JRC94879 >

9
Figure 6: Captive hydrogen production capacity for refining by country
Source: Fuel Cells and Hydrogen Observatory

2,500

2,000
Tonnes per day

1,500

1,000

500

1.2.2. Ammonia

Next to refineries, the ammonia industry is the second largest hydrogen producing and consuming
sector in the EU. Total ammonia-related hydrogen production capacity in Europe was approximately
9,382 t per day split between 36 facilities. All of them were using either steam methane reforming or
partial oxidation (POX) to generate hydrogen.

Similarly to refining, Germany had the largest share with 15.8% of Europe’s hydrogen production
capacity dedicated to ammonia production, closely followed by the Netherlands (15.6%), Poland
(15.5%), France (8%), and the United Kingdom (6%).

The ammonia production process involves a synthesis of hydrogen with nitrogen according to the
following formula:

N2 + 3 H2 → 2 NH3

This process consumes about 175-180 kg of hydrogen per t of ammonia.

10
Figure 7: Captive hydrogen production installations for ammonia plants
Source: Fuel Cells and Hydrogen Observatory

Figure 8: Captive hydrogen production capacity for ammonia plants by country

Source: Fuel Cells and Hydrogen Observatory

1,600
1,400
1,200
Tonnes per day

1,000
800
600
400
200
0

11
1.2.3. Other captive hydrogen production plants

The captive hydrogen production sites located in refineries or ammonia plants comprise around 93%
of total captive hydrogen production. Other than these processes, hydrogen is produced at scale also
for the production of a number of other chemicals, including methanol and hydrogen peroxide. Total
captive hydrogen production capacity in Europe dedicated to methanol and other chemicals is
approximately 1,837 t per day split between 26 facilities.

The most common methanol production method is steam reforming of methane and subsequent
synthesis, and follows the following process:

1st step: CH4 + H2O → CO + 3 H2 and CO + H2O → CO2 + H2

2nd step: 3 H2 + CO2 → CH3OH + H20

This production consumes about 1,400 Nm3 H2/t of methanol.15 Methanol is an important chemical
raw material used to produce formaldehyde, acetic acid and MTBE or fatty acid methyl esters (FAME),
adhesives and solvents.

Other uses of hydrogen in the chemical industry include the production of such high-volume chemical
products as hydrogen peroxide, for which hydrogen consumption is approx. 735 Nm3 H2/t16, hydrogen
chloride, aniline, cyclohexane, TDI, and oxo-alcohols. In most cases, production of those chemicals takes
place at large integrated chemical or petrochemical plants.

As is the case with hydrogen produced for the refining or fertilizer industry, the overwhelming number
of installations today use fossil fuels as feedstock for production of hydrogen.

One notable exception is Carbon Recycling International's George Olah Renewable Methanol Plant in
Svartsengi (Iceland). The plant is able to produce 5 million litres of methanol per year and uses hydro
and geothermal energy for producing hydrogen from water electrolysis, which is then reacted with
CO2 from flue gases to produce methanol.17

15 G. Maisonnier, J. Perrin, R. Steinberger-Wilckens y S. C. Trümper, «European Hydrogen Infrastructure Atlas” and “Industrial Excess
Hydrogen Analysis”,» Roads2HyCom, 2007. < https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.477.3069&rep=rep1&type=pdf
>
16 Ibid.
17 B. Rego de Vasconcelos y J.-M. Lavoie, «Recent Advances in Power-to-X Technology for the Production of Fuels and Chemicals,»

Frontiers in Chemistry, 2019. < https://www.frontiersin.org/articles/10.3389/fchem.2019.00392/full >

12
Figure 9: Captive hydrogen production installations for methanol and other chemicals
Source: Fuel Cells and Hydrogen Observatory

Figure 10: Captive hydrogen production capacity for methanol or other chemical plants, excluding ammonia
Source: Fuel Cells and Hydrogen Observatory

800
700
600
Tonnes per day

500
400
300
200
100
0

1.3. Merchant hydrogen production

The report identified 105 merchant hydrogen plants operational in Europe in 2020. Total capacity of
those plants has been estimated at 3,575 t per day.

13
The merchant hydrogen plants can be divided into two main categories:

• plants dedicated to supply a single large-scale consumer with only excess capacity available
to supply the retail hydrogen market; and
• small and medium scale hydrogen production sites designed for the purpose of supplying
mostly retail customers.

While the first type can be comparable in scale to the largest captive hydrogen production facilities, the
installations designed with the hydrogen retail market in mind are an order of magnitude smaller in
terms of their maximum capacity.

Figure 11: Identified merchant hydrogen plants

Source: Fuel Cells and Hydrogen Observatory

The merchant hydrogen market in Europe is dominated by 4 groups: Linde Gas, Air Liquide, Air Products
and Messer, that own a combined 84% of plants and 90% of total merchant hydrogen production
capacity.

As was the case with captive hydrogen production, most merchant hydrogen production capacity is
located in Germany (30%), the Netherlands (18%), Spain (13%), Italy (11%), and France (9%).

14
Figure 12: Merchant hydrogen production capacity.
Source: Fuel Cells and Hydrogen Observatory

1,200

1,000
Tonnes per day

800

600

400

200

From a technology perspective, while most production capacity is still fossil fuel based, 11% of the
merchant hydrogen production capacity also comes from by-product production from the chlor-alkali
and sodium chlorate processes.

1.4. By-product hydrogen production

By-product hydrogen production capacity, meaning hydrogen produced as a by-product of other
processes, has been estimated at 4,303 t per day18, including:

• 2,099 t per day of hydrogen mixed in coke oven gas,

• 1,166 t per day of hydrogen produced during ethylene production,
• 580 t per day of hydrogen produced by the chlor-alkali process,
• 357 t per day of hydrogen produced during styrene production,
• 100 t per day of hydrogen produced by the sodium chlorate process.

The hydrogen production rate for ethylene and styrene production processes is around 190 Nm 3 H2/t
ethylene and 220 Nm3 H2/t of styrene.19 By-product hydrogen from those industries is almost
universally used on site as a feedstock for other chemical or petrochemical processes further
downstream.

The by-product production rate from the chlor-alkali industry is around 300 to 270 Nm3 H2/t chlorine.20
On average, the industry vents around 15% of produced hydrogen into the atmosphere with the
remaining 85% usually burned for heat or used in a CHP unit to generate both heat and power. Because

18 The total by-product capacity has decreased significantly compared to the September 2021 report’s 8,523 t per day due to two
methodological changes. By-product hydrogen production capacity in refineries was moved from the by-product section to the captive
section and hydrogen production from coke production was reduced from 450 to 207 Nm3 H2/t of product.
19 G. Maisonnier, J. Perrin, R. Steinberger-Wilckens y S. C. Trümper, «European Hydrogen Infrastructure Atlas” and “Industrial Excess

Hydrogen Analysis”,» Roads2HyCom, 2007. < https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.477.3069&rep=rep1&type=pdf

>
20
Ibid.

15
by-product hydrogen from the chlor-alkali industry has high purity, if a pipeline network is available, by-
product hydrogen can also be sold to other industrial users or sold to hydrogen merchants.

The biggest potential source of by-product hydrogen is coke oven gas (COG), where the hydrogen
production rate is approximately 207 Nm3 H2/t of product. In this case though, the output gas is not
pure hydrogen but rather a mixture of hydrogen (55%-65%) and methane, carbon monoxide, CO2 and
nitrogen. Coke oven gas is used to enrich the calorific value of the other process gases for use in blast
furnace stoves, the reheating furnaces of hot strip mills, for other high temperature processes, or for
the under-firing of coke ovens. The surplus COG may be utilised at the blast furnace as an alternative
reducing agent and is also used in power plants.21 Other, smaller by-product hydrogen sources include
acetylene and cyanide production.

Figure 13: Identified by-product hydrogen production plants

Source: Fuel Cells and Hydrogen Observatory

21R. Remus, M. A. A. Monsonet, S. Roudier y L. D. Sancho, «Best Available Techniques (BAT) Reference Document for Iron and Steel
Production,» JRC Reference Report, 2013. < https://eippcb.jrc.ec.europa.eu/sites/default/files/2019-11/IS_Adopted_03_2012.pdf >

16
Figure 14: By-product hydrogen production capacity
Source: Fuel Cells and Hydrogen Observatory

Coke oven gas Ethylene Chlor-alkali Styrene Sodium chlorate

1,000
Tonnes per day

800
600
400
200
0

1.5. Clean hydrogen production capacity

The most common method of producing hydrogen is steam reforming of natural gas (SMR). Less
common are partial oxidation (POX) and autothermal reforming (ATR). SMR and natural gas is widely
used for all applications including oil refining, ammonia synthesis, or any other bulk hydrogen
production. Even though natural gas is the most common feedstock, steam reforming is also used with
other feedstocks, which include also liquid hydrocarbons like LPG or naphtha.

Out of the 338 identified hydrogen production plants which were using fossil fuels as feedstock, only
three were using carbon capture technologies:

• Grupo Sappio hydrogen production unit in Mantova, Italy with a capacity of around 1,500
Nm3/h that started operating in 2016.
• Air Liquide Cryocap installation in Port Jerome, France, capturing CO2 from hydrogen supplied
to an Exxon refinery, with a capacity of around 50,000 Nm3/h that started operating in 2015.
• Shell refinery in Rotterdam, Netherlands where CO2 from hydrogen production is captured and
sold for agricultural use as part of the OCAP project since 2004.

The total share of hydrogen production capacity from fossil fuels with CCS/CCU is ~0.42% equating to
131 tonnes per day.

Hydrogen can, of course, also be produced with electricity by splitting water via water electrolysis.
There is a significant number of electrolysers installed in Europe. In the past, electrolysers have been
employed whenever the volume of hydrogen demand was high enough to warrant building a dedicated
installation onsite, instead of external supplies in cylinders or tube trailers, but not high enough to invest
in an SMR + PSA unit, especially whenever high purity grade hydrogen is required. This includes for
example electrolysers installed for captive hydrogen production at food processing facilities (fat
hardening) or power plants where hydrogen is used for cooling purposes.

Power-to-hydrogen installations, where electricity is used to produce hydrogen via water electrolysis,
have been proliferating in the last several years with increasing number of not only demonstration but
also commercial projects being deployed.

By the end of 2020, the authors identified 114 operational power-to-gas (water electrolysis) projects.
Total power of those electrolysers was around 99 MW equalling a hydrogen generation capacity of ~44

17
t of electrolytic hydrogen per day (0.14% of total production capacity).22 23 This represents an 11%
increase in operational power-to-hydrogen capacity between 2019 and 2020 caused by 19 new projects
adding 7 MW of capacity. Compared to 2018, it represents a 31% increase in capacity over two years.
While this report covers the year 2020, there was a significant planned deployment of new electrolyzer
capacity in 2021 of around 36 MW with total expected PtH capacity in Europe reaching 135 MW or 60
t per day in 2021. That would represent a 36% increase compared to 2020 and 97% increase compared
to 2018.

While some of the operational plants are commercial plants, others were built as part of R&D or
demonstration plants destined to be decommissioned after only a few years of operations.

Most of them produce electrolytic hydrogen for on-site industrial consumption, merchant sales,
mobility applications, or energy storage for renewable energy grid balancing.

Countries with the largest number of installations are Germany (33), France (22), United Kingdom (14).
Countries with the largest installed water electrolytic production capacity are Germany with 19,
Switzerland with 4.3, Finland with 4, and Austria with 3 t per day.

Figure 15: Hydrogen production capacity and number of installations using water electrolysis in 2020
Source: Fuel Cells and Hydrogen Observatory

25 33

20
23
Tonnes per day

15
14
10

5 5 4 4 4 4 4
2 3 3 2 2 2 2
1 1 1
0

22 The production numbers from electrolysis reflect maximum technical production capacity. Actual production numbers are significantly
lower due to the various operating conditions of the individual electrolysers.
23 The 44 tons per day of water electrolysis capacity is additional to the captive, by-product, and merchant numbers provided in the

sections before. All together they amount to the total displayed of 33,026 t per day if we include coke oven gas.

18
2. Demand for hydrogen
2.1. Summary
Total demand for hydrogen in the analysed countries in 2020 has been estimated at 8.6 Mt. The biggest
share of hydrogen demand comes from refineries, which were responsible for 50% of total hydrogen
use, followed by the ammonia industry with 29%. Together these two sectors consumed 79% of total
hydrogen consumption in the EU, EFTA, and UK. About 12% is consumed by the chemical industry, with
methanol production accounting for 5% of that.

Emerging hydrogen applications, like the transportation sector, comprised a very small portion of the
market (0.02% in 2020).

Hydrogen consumption data in this report has been collected and estimated based on available
information gathered from a number of public and private sources. The external sources include
EUROSTAT, a number of trade associations (Eurochlor, Fertilizers EUROPE, Fuels Europe, CONCAWE,
Petrochemicals Europe, Cefic), and others.

Figure 16: Total demand for hydrogen in 2020 by application

Source: Fuel Cells and Hydrogen Observatory

Refining 4,315,704

Ammonia 2,543,231

Other chemicals 633,933

Methanol 434,464

Other 394,953

Energy 325,519

Transport 1,453

0% 10% 20% 30% 40% 50% 60%

Percentage of total demand and absolute value

More than half of total hydrogen consumption takes place in just four countries: Germany (20%), the
Netherlands (15%), Poland (9%), and Spain (6%).

19
Figure 17: Total demand for hydrogen in 2020 by country
Source: Fuel Cells and Hydrogen Observatory

1,800,000
1,600,000
Tonnes per year

1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
-

Luxemburg
France

Romania
Norway

Finland

Iceland
Austria

Denmark

Latvia
Germany

Poland
Spain
Italy

Greece

Hungary
Netherlands

Slovakia

Bulgaria

Croatia

Ireland

Cyprus
Slovenia
Belgium

Portugal
Lithuania

Estonia

Malta
Sweden

Czechia

Switzerland

Liechtenstein
United Kingdom

Refining Ammonia Methanol Other chemicals Energy Transport Other

2.2. Refining industry

As mentioned in Section 1.2.1, refineries use hydrogen mostly for hydrocracking and hydrotreating
processes, including hydrodesulphurisation. As legislative requirements require ever lower sulphur
content in fuels, more desulphurisation is needed to achieve these targets, driving up hydrogen
consumption in the sector.24 Similarly, as demand for distillates such as jet fuel, kerosene, high-quality
lubricating oils, and diesel continues to increase worldwide, so does the importance of hydrocracking.
As a result, even though some refining processes generate hydrogen, most refineries are net consumers
of it. Yet, because the net hydrogen balance of a refinery depends strongly on the specific processes
involved and the mix of output products, it is extremely challenging to precisely estimate the actual
demand for hydrogen, which cannot be calculated based on processing or production volumes alone.

Nevertheless, based on gathered information about hydrogen production capacities at refineries,

together with information about their capacity utilization, this report estimates that the total hydrogen
demand from oil refining was 4.3 Mt in 2020.

24R. Remus, M. A. A. Monsonet, S. Roudier y L. D. Sancho, «Best Available Techniques (BAT) Reference Document for Iron and Steel
Production,» JRC Reference Report, 2013. < https://eippcb.jrc.ec.europa.eu/sites/default/files/2019-11/IS_Adopted_03_2012.pdf >

20
Figure 18: Hydrogen demand in oil refining
Source: Fuel Cells and Hydrogen Observatory

700,000

600,000
Tonnes per year

500,000

400,000

300,000

200,000

100,000

Finland
France

Romania

Norway
Hungary

Austria
Germany

Spain
Italy
Poland
Greece

Croatia

Denmark
Netherlands

Slovakia
Belgium

Bulgaria

Ireland
Portugal

Lithuania
Sweden

Czechia

Switzerland
United Kingdom

2.3. Chemical industry

In the chemical industry, the largest consumers of hydrogen are the ammonia manufacturers. Ammonia
is used for the production of fertilizers and nitric oxide, which is an intermediate product for the
production of nitric acid. In addition, ammonia is used for the production of sodium carbonate (soda
ash), explosives, hydrogen cyanide, synthetic fabrics, and other products.

Total demand for hydrogen by the ammonia industry in 2020 was 2.5 Mt. Due to confidentiality issues,
detailed statistics about ammonia production are not available for some EU Member States. In those
cases, hydrogen production capacity in the ammonia industry in those countries and utilization rates
were used instead.

21
Figure 19: Hydrogen demand for ammonia
Source: Fuel Cells and Hydrogen Observatory

450,000

400,000

350,000

300,000
tonnes per year

250,000

200,000

150,000

100,000

50,000

Even though the ammonia industry dwarfs other applications, it is by no means the only source of
demand for hydrogen from the chemical industry. Other chemicals that require hydrogen input in their
production process are (among others):

• Methanol
• Cyclohexane
• Aniline
• Caprolactam
• Hydrogen Peroxide
• Oxo Alcohols C8
• Oxo Alcohols C4
• Toluene Diiscocyanate (TDI)
• Hexamethylenediamine
• Adipic acid
• Hydrochloric acid
• Tetrahydrofuran

22
Figure 20: Hydrogen demand for ammonia
Source: Author’s own elaboration

Total demand for hydrogen, in 2020, from the chemical industry, other than ammonia production, has
been estimated at around 1.1 Mt, with more than half coming from Germany and the Netherlands.

23
Figure 21: Hydrogen demand for the chemical industry excluding ammonia
Source: Fuel Cells and Hydrogen Observatory

300,000

250,000
Tonnes per year

200,000

150,000

100,000

50,000

Methanol Other chemicals

2.4. Other industries

The oil refining and chemical industries are responsible for 92% of total demand for hydrogen. The
remaining demand comes from the following applications:

Steel manufacturing and metals processing

Mixture of hydrogen and nitrogen (5% to 7% hydrogen) is used commonly as an inert protective
atmosphere in conventional batch annealing in annealing furnaces. Batch annealing with 100%
hydrogen is also possible and results in better productivity, improved mechanical properties, surface,
and product quality.

Glass manufacturing

In the glass industry, hydrogen is an inerting or protective gas in flat glass production. It is also used in
the flame polishing process of glass products.

Food processing

By hydrogenating unsaturated fatty acids in vegetable oils, hydrogen is used in the production of
margarine. Hydrogenation is usually carried out by dispersing hydrogen gas in the oil, in the presence
of a finely divided nickel catalyst supported on diatomaceous earth.

Energy sector

While hydrogen can be used in a fuel cell to generate heat and energy with high efficiency, currently
hydrogen use in the energy sector mostly consists of:

• Burning hydrogen in boilers or CHP units for heat or heat and power generation – mostly
done onsite where hydrogen is generated as a by-product of other processes (chlor-alkali,
ethylene).

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• Using hydrogen for generator cooling. The amount of hydrogen demand depends on the
installed power of turbines, their age and technical condition – especially the condition of
the generator’s hydrogen seals. Depending on those factors, and resulting hydrogen
demand, some power plants have their own HGU’s and only use external suppliers to cover
additional needs, while other supply all of the required hydrogen from external sources.

Transportation

Hydrogen can also be used as a fuel – both directly in fuel cells or in an internal combustion engine, or
indirectly when renewable hydrogen is used to synthesise other more complex synthetic fuels. While
this application currently forms an insignificant part of hydrogen consumption (below 0.1%), it is
expected to grow in the future.

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3. Conclusion
The purpose of this report is to provide an overview of the hydrogen market in Europe and to track
industry’s progress in deploying clean hydrogen technologies.

The power-to-hydrogen capacity in EU, EFTA, UK continued to grow with 11% added in 2020 reaching
99 MW or 44 t per day. Numerous projects have been announced in 2019 and 2020. While this report
covers the year 2020, there was a significant planned deployment of new electrolyzer capacity in 2021
of around 36 MW with total expected PtH capacity in Europe reaching 135 MW or 60 t per day in 2021.
That would represent a 36% increase compared to 2020 and 97% increase compared to 2018.

Only three operational hydrogen production plants with carbon capture continue to operate in Europe.

The traditional hydrogen supply capacity market is stable so changes compared to previous years
primarily reflect methodological changes as well as continuously improving accuracy of the supply
capacity data rather than market trends. The methodological changes compared to the September
2021 report were described in the relevant parts of the report, but the main ones include classifying
by-product hydrogen production capacity in refineries as captive and reducing the potential of
hydrogen production capacity from coke production.

In terms of demand, hydrogen consumption in refining was revised and increased by 6% compared to
last year. The increase reflects additional data becoming available in the refining sector and a trend of
increasing hydrogen consumption in refining. Hydrogen demand for ammonia remained largely stable
and its 1.4% decrease was caused mostly by lower utilizations during the COVID pandemic. Hydrogen
consumption for methanol production increased by 4% mostly driven by changing capacity factors. The
last significant change on the demand side concerns burning of hydrogen for energy where the value
increased from 103 to 325 thousand tons per day due to a methodological change concerning by-
product hydrogen from ethylene production and its burning on site.

26
4. Appendix 1: List of Acronyms
ATR Autothermal reforming
CCS Carbon capture and storage
CCU Carbon capture and utilisation
CHP Combined heat and power
COG Coke oven gas
EEA European Economic Area
EFTA European Free Trade Association
EU European Union
FAME Fatty acid methyl esters
FCEV Fuel cell electric vehicle
HGU Hydrogen Generation Unit
HyARC Hydrogen Analysis Resource Centre
JRC Joint Research Centre
LPG Liquefied petroleum gas
Mt Million tonnes
MTBE Methyl tert-butyl ether
POX Partial oxidation
PSA Pressure swing adsorption
SMR Steam methane reforming
TDI Toluene diisocyanate

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5. Appendix 2: References
G. Maisonnier, J. Perrin, R. Steinberger-Wilckens y S. C. Trümper, «European Hydrogen Infrastructure
Atlas” and “Industrial Excess Hydrogen Analysis”,» Roads2HyCom, 2007. <
https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.477.3069&rep=rep1&type=pdf >

P. Barthe, M. Chaugny y L. Serge Roudier, «Best Available Techniques (BAT) Reference Document for
the Refining of Mineral Oil and Gas,» JRC, 2015.
<https://publications.jrc.ec.europa.eu/repository/handle/JRC94879 >

B. Rego de Vasconcelos y J.-M. Lavoie, «Recent Advances in Power-to-X Technology for the Production
of Fuels and Chemicals,» Frontiers in Chemistry, 2019. <
https://www.frontiersin.org/articles/10.3389/fchem.2019.00392/full >

R. Remus, M. A. A. Monsonet, S. Roudier y L. D. Sancho, «Best Available Techniques (BAT) Reference

Document for Iron and Steel Production,» JRC Reference Report, 2013. <
https://eippcb.jrc.ec.europa.eu/sites/default/files/2019-11/IS_Adopted_03_2012.pdf >

The Pacific Northwest National Laboratory, «the Hydrogen Tools Portal, <
https://h2tools.org/hyarc/hydrogen-data/merchant-hydrogen-plant-capacities-europe >

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