The Balkan region is abuzz with plans for a hydrogen-powered future. From ambitious hydrogen production facilities to visions of fuel-cell buses cruising city streets, Southeast European countries are eager to join the hydrogen revolution. Yet, a critical bottleneck remains: major hydrogen original equipment manufacturers (OEMs) have been slow to enter the Balkans. This reluctance raises a pressing question: Why are OEMs hesitant to sell their hydrogen technology and equipment in an underdeveloped yet enthusiastic market? The answer lies in a combination of market immaturity, infrastructural gaps, financial hurdles, and strategic considerations.
Enthusiasm in an Underdeveloped Market
Balkan nations are eager to decarbonize and have announced numerous hydrogen initiatives in recent years. Governments are setting climate targets aligned with the EU, aiming for carbon neutrality around mid-century. Political momentum for hydrogen is growing across the region. For instance, Serbia is planning a major hydrogen production facility (30,000 tons per year by 2028) as part of a 2 billion EUR energy investment, in alliance with the Chinese. Croatia’s national hydrogen strategy targets 70 MW of hydrogen capacity by 2030 and an impressive 2,750 MW by 2050. Likewise, North Macedonia and Croatia are seeking investors to convert old coal plants into hydrogen-capable facilities, while Albania is even exploring natural hydrogen reservoirs. These plans illustrate a high level of enthusiasm and political will to build a hydrogen economy.
On the mobility front, the Balkans see hydrogen as a solution for cleaner transport. Several governments have announced pilot programs to introduce hydrogen fuel in public transit. Croatia, for example, is soon launching subsidies for its first hydrogen refuelling stations, aiming to install at least six by 2026 to serve cars, buses, and trucks. Several studies suggest that heavy road transport and public bus fleets in major cities (e.g,. Zagreb, Belgrade or Sarajevo) could become early adopters of fuel-cell vehicles. Such initiatives signal that the region is keen to leap from plans to prototypes in hydrogen mobility.
Despite this optimism, the Balkan hydrogen market is still underdeveloped. Most projects remain in planning or pilot stages. Actual deployment of hydrogen technology on the ground – whether production plants or fuel-cell vehicles – is minimal so far. No significant hydrogen infrastructure exists yet for distribution or refuelling outside a few upcoming projects. In short, the Balkans have big hydrogen dreams but very nascent foundations. This gap between ambition and reality is a key factor in why OEMs are holding back.
Infrastructure and Investment Gaps Create a Catch-22
A major hurdle facing Balkan hydrogen plans is the lack of supporting infrastructure and investment. The International Energy Agency notes that globally, even as interest in hydrogen grows, implementation is “held up by an uncertain demand outlook and a lack of infrastructure to deliver the fuel to consumers”. This observation rings especially true in the Balkans. Without refuelling stations, pipelines or storage facilities, any hydrogen produced cannot easily reach end users. Likewise, without existing hydrogen vehicles or industrial off-takers, there is little demand to justify building that infrastructure. It’s a classic chicken-and-egg scenario – and investors are wary of going first, especially since the cost of them covering both aspects is not feasible.
Attracting private investment into Balkan clean energy projects has historically been challenging. Analysts point out that while the region has ample renewable energy potential to produce green hydrogen, bringing in investors and expanding the energy grid remain key hurdles. Many announced projects are still seeking financing or partners, and some depend on EU funding or development bank support. This financial uncertainty makes equipment suppliers cautious; they need assurance that projects will materialize and operate at scale.
Crucially, the hydrogen market itself in the Balkans is essentially undeveloped. A recent Croatian study, focused on the plan for implementation of the national strategy, has highlighted that the majority of hydrogen projects in that country are still disjointed pilot efforts – most planned production far exceeds current local demand, with many projects lacking clear buyers for their hydrogen. Only a handful of pilot projects both produce and use hydrogen in an integrated way, partially mitigating the risk associated with the lack of a hydrogen market. In other words, right now there are very few (planned) consuming industries or fleets in the region ready to purchase hydrogen at the volumes envisaged. This uncertain demand makes the market extremely risky for OEMs to enter – a large investment in sales and support could sit idle if customers do not emerge as hoped.
Why OEMs Are Reluctant: A Business Perspective
Given these conditions, it is understandable that hydrogen technology manufacturers are reluctant to dive into the Balkans at this stage. From an OEM’s business perspective, several factors contribute to their hesitation:
- Small Market Size: The current sales potential in the Balkans is very small. There are no hydrogen vehicles on the road and only initial plans for electrolysers or fuel-cell units in industry. An executive deciding where to allocate limited units or demo projects will favour larger markets (Western/Northern Europe, North America, Asia) where hundreds of units might be sold, rather than a market that might buy just one or two pilot systems.
- Lack of Infrastructure & Ecosystem: Selling a hydrogen bus or electrolyser is not a one-off transaction – it requires an ecosystem. An OEM considering selling fuel-cell buses to a Balkan city would see that no fuelling stations exist yet and maintenance facilities and trained technicians are absent. Similarly, an electrolyser manufacturer sees grid limitations and uncertain renewable supply. Without the surrounding infrastructure, their product cannot perform, potentially leading to failure or bad press. Many OEMs prefer to wait until a basic hydrogen infrastructure network is in place or at least firmly committed.
- High Upfront Costs, Low Subsidies: Hydrogen equipment is expensive and early-stage projects often rely on subsidies to establish feasibility. In wealthier markets, governments offer generous incentives (grants, tax breaks, carbon credits) to offset costs. Balkan countries, with more limited resources, offer fewer financial incentives, making projects less bankable. OEMs worry that clients in the region may struggle to finance purchases or maintain operations without substantial aid. The high operating costs (OPEX) for hydrogen installations, on top of capital cost, further deter both buyers and sellers.
- Policy and Regulatory Uncertainty: While Balkan nations are drafting hydrogen strategies (Serbia, for example, has a draft Hydrogen Strategy through 2030 in the works), many policies are still lacking to follow up. Stable regulations, safety standards and long-term targets provide confidence to manufacturers. The absence of a clear, enforceable framework – such as hydrogen fuel quotas for public transport or guaranteed offtake agreements – means OEMs cannot count on a steady market. Any change in government or economic downturn could derail nascent hydrogen programs, leaving the OEM’s investment stranded.
- Logistics and Support Challenges: Entering a new regional market means establishing local partnerships, support centres and supply chains. For specialized hydrogen technology, local technical expertise is scarce in the Balkans (understandably, since it is new). OEMs would need to invest in training or stationing personnel for installation and maintenance. Doing this for a handful of units is inefficient. Until they foresee scaling up to dozens of installations, companies may opt to serve the region from afar on a case-by-case basis, rather than fully “enter” the market with a local presence.
In essence, hydrogen OEMs are making a calculated business decision. The Balkans, at present, offer high uncertainty and low immediate reward. It is no surprise that they prioritize markets where the hydrogen rollout is already well underway. Hydrogen’s viability in new regions is hampered by uncertain demand and missing infrastructure, making companies cautious about over-promising and under-delivering. From the OEM viewpoint, waiting for the Balkans to cross a certain threshold of readiness is a prudent strategy.
Consequences and the Case for Support
While the hesitation of OEMs is understandable, it creates a paradox for the Balkans: without the equipment suppliers on board, many of the region’s hydrogen plans could stall. Ambitious targets and feasibility studies alone cannot cut emissions – real buses, fuelling stations and electrolysers must be deployed. If European OEMs remain on the sidelines, Balkan countries might struggle to implement their pilot projects in transport and energy. This could lead to delays in meeting climate goals and prolong the region’s reliance on fossil fuels.
Moreover, there is a risk that other players might fill the void. For example, some Balkan projects have already attracted interest from non-EU partners (Chinese companies co-investing in Serbia’s hydrogen facility, for instance). If EU-based OEMs are too slow, the region could turn to cheaper or more readily available equipment from elsewhere, potentially undercutting Europe’s technology influence in the long run. The European Clean Hydrogen Alliance has explicitly encouraged the participation of Western Balkan countries – a recognition that integrating these emerging markets is crucial for a continental hydrogen economy. Supporting the Balkans now could expand the overall market for hydrogen technology and create future customers for OEMs once the market matures.
From a development perspective, the Balkans hydrogen market would greatly benefit from the assistance of more developed regions. This could include knowledge transfer, funding and policy support. Western European governments and companies can help by involving Balkan partners in hydrogen projects, sharing best practices and co-developing infrastructure. EU funds and development banks are already stepping in with grants and loans for green transition projects; scaling up these efforts specifically for hydrogen (for example, through contracts-for-difference schemes or dedicated infrastructure grants) could reduce the risk for both investors and OEM suppliers. Essentially, a stronger external push could jump-start local demand – for instance, by subsidizing a fleet of hydrogen buses in a capital city or guaranteeing the purchase of green hydrogen for industry. Such moves would give OEMs the confidence of a committed end-user, making them more willing to deploy equipment.
Bridging the Gap: Early Movers and Future Outlook
The current hesitancy is a snapshot in time. The Balkan hydrogen market is young, but it is not stagnant. Each small step – a pilot project completed, a station built, a strategy adopted – adds momentum. Over the next few years, as a few flagship projects break ground and prove viability, OEM attitudes may shift. Early mover manufacturers who partner with Balkan stakeholders now could gain a foothold and relationships that pay off once the market expands. It is worth noting that regional experts anticipate hydrogen demand in the coming years to rise substantially, eventually catching up to planned production. The long-term trajectory points upward.
Hydrogen OEMs’ reluctance to open the Balkans market stems from rational concerns about an underdeveloped environment – few buyers, scant infrastructure, high costs, and uncertainty. However, this is a market with enthusiasm and growth potential, not a lack of interest. Bridging the gap will require both local initiative and external support. If more developed regions and companies lend their expertise and backing to Balkan hydrogen endeavours, it can create a virtuous cycle: successful projects will stimulate demand, which in turn will attract more OEM participation. Critical as we may be of the slow start, the reasoning behind it is clear – and so is the imperative to overcome it. The Balkans may yet transform from a hydrogen hope to a hydrogen hub, but not without concerted effort to convert plans into reality. For hydrogen OEMs, the message is that while caution is understandable, strategic engagement and support now could cultivate a thriving new market shortly – a win-win for the region’s clean energy transition and for the industry’s global growth.
