by Power-to-gas technology utilizes renewable power sources like solar and wind to produce hydrogen or methane through electrolysis. Power-to-gas helps store excess renewable energy in the form of gas to be used later for generating electricity, heating applications, transportation fuel and more. The technology allows the conversion of electrical power from intermittent renewable sources into a gas fuel, by synthesizing hydrogen or renewable natural gas through power-to-x processes. This offers an alternative to the traditional use of natural gas. As concerns around climate change increase, many countries are investing significantly in renewable energy to decarbonize their economies. However, the intermittent nature of renewable resources like solar and wind poses integration challenges. Power-to-gas helps address this issue by allowing for the storage of excess renewable energy in different gas networks and infrastructure. The global Power-to-Gas Market is estimated to be valued at US$ 39.13 Bn in 2024 and is expected to exhibit a CAGR of 15% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the key trends in the power-to-gas market size is the increasing focus on large-scale projects. Several pilot and demonstration power-to-gas projects are ongoing across different regions to assess techno-economic feasibility at an industrial scale. For instance, electrolyzer sizes are increasing from kilowatts to the megawatt range. Also, projects are integrating multiple power-to-gas and power-to-liquid pathways to better utilize renewable electricity. This allows improved economics through economies of scale. Many countries are also developing supportive policy frameworks and incentives to promote hydrogen and power-to-gas specifically. For example, the European Union aims to install at least 6 GW of renewable hydrogen electrolyzers by 2024 and 40 GW by 2030. This is expected to significantly boost industry growth over the forecast period.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is low to moderate due to the requirement for significant investment and expertise in electrolysis and methanation technologies.
Bargaining power of buyers: The bargaining power of buyers is moderate as the Power-to-Gas market provides solution for renewable energy storage and integration.
Bargaining power of suppliers: The bargaining power of suppliers is moderate due to availability of alternative electrolyzer and methanation system suppliers in the market.
Threat of new substitutes: The threat of new substitutes is low as Power-to-Gas provides a unique value proposition for long term renewable energy storage.
Competitive rivalry: The competitive rivalry is moderate to high due to presence of many technology providers focusing on development of efficient Power-to-Gas solutions.
Key Takeaways
The global Power-to-Gas market is expected to witness high growth.
Regional analysis: Europe accounted for over 50% of the global installed Power-to-Gas capacity in 2020. Government support through incentives and regulatory mandates has led to large number of demonstration projects in the region. Countries like Germany and Netherlands are focusing on use of Power-to-Gas to integrate higher shares of renewable energy in their energy mix. Asia Pacific is also expected to witness significant growth during the forecast period ascribing to rising investments in renewable energy sector in countries like China and India.
Key players: Key players operating in the Power-to-Gas market are Codexis Inc., Abzena, Ltd., Enantis s.r.o, GenScript Biotech Corp., Waters Corporation, PerkinElmer, Inc., Bruker Corporation. These companies are focusing on development of efficient and cost competitive Power-to-Gas systems to gain higher market share. For instance, Envais and Hydrogenics have developed integrated Power-to-Gas solutions targeting commercial and industrial applications.
