Global clean hydrogen production is now expected to reach only 150 million to 160 million tonnes annually by 2050, according to DNV’s latest hydrogen outlook, marking a sharp downgrade from the company’s earlier expectations and reinforcing growing concerns that the hydrogen economy is advancing far more slowly than governments and developers anticipated just a few years ago.
The revised forecast, published in DNV’s 2026 Energy Transition Outlook: Hydrogen to 2060 report, represents a 45% reduction from the company’s 2022 projection. The downgrade reflects delayed project execution, weakening policy momentum, financing challenges, and the persistent difficulty of turning announced hydrogen capacity into commercially operational infrastructure.
The scale of the revision is notable because DNV had previously been among the more optimistic forecasters regarding hydrogen’s role in the global energy transition. The updated outlook now aligns more closely with a growing industry reassessment taking place across Europe, Australia, and North America, where several large-scale projects have been postponed, downsized, or canceled amid deteriorating economic conditions.
Despite the reduced outlook, DNV still projects cumulative hydrogen-related investment could reach approximately $3.2 trillion by 2060. That figure includes renewable electricity generation built specifically to support off-grid green hydrogen production, highlighting how hydrogen deployment remains deeply tied to broader renewable energy expansion.
The report estimates that renewable electrolysis will account for roughly 130 million tonnes of annual clean hydrogen production by 2050, while low-carbon hydrogen produced through natural gas reforming combined with carbon capture and storage could contribute another 40 million tonnes annually.
Even under those reduced projections, clean hydrogen would still represent substantial growth compared with today’s market. Global hydrogen production currently totals around 100 million tonnes annually, though the overwhelming majority remains fossil fuel based. According to DNV, existing hydrogen production generates approximately 1.3 billion tonnes of CO₂ emissions every year, primarily from unabated natural gas and coal-based production processes.
Green hydrogen produced through renewable electrolysis remains significantly more expensive than conventional hydrogen in most markets, largely because of high electricity consumption, electrolyzer capital costs, infrastructure requirements, and utilization constraints tied to intermittent renewable power generation. Hydrogen transportation, storage, and downstream conversion into fuels such as ammonia or methanol add further cost and efficiency penalties.
Those economics have become increasingly difficult in a higher interest rate environment where capital-intensive infrastructure projects face elevated financing costs and investors demand clearer pathways to profitability.
DNV identified stalled or weakened policy frameworks as one of the primary drivers behind the revised forecast. Hydrogen markets remain heavily dependent on government subsidies, carbon pricing systems, mandates, and regulatory incentives to compete with fossil-based production. In several regions, policy implementation has proven slower or less stable than developers initially expected.
Australia recently reduced hydrogen funding forecasts after acknowledging lower-than-expected industry uptake. Europe’s hydrogen sector has also encountered delays linked to permitting complexity, grid constraints, and uncertainty surrounding long-term industrial demand. In the United States, implementation timelines for hydrogen tax credits and lifecycle emissions rules have introduced additional uncertainty into project economics.
The report nevertheless maintains that hydrogen will remain strategically important for sectors where direct electrification is technically difficult or economically impractical. DNV specifically identified steel manufacturing, aviation, maritime transport, and heavy industry as areas likely to sustain long-term hydrogen demand despite slower market growth.
That distinction increasingly shapes the industry’s direction. Earlier hydrogen strategies often promoted economy-wide deployment across transport, heating, power generation, and industrial applications simultaneously. More recent market assessments suggest hydrogen adoption may become concentrated primarily in sectors with limited decarbonization alternatives rather than serving as a universal energy carrier.
China is expected to dominate much of that future growth. DNV forecasts the country will account for approximately 35% of global clean hydrogen expansion over the coming decades, driven by industrial decarbonization goals and policy support embedded within Beijing’s 15th Five-Year Plan.
The scale of China’s industrial system gives it structural advantages in hydrogen deployment, particularly in steel, chemicals, refining, and heavy manufacturing. The country also maintains substantial control over electrolyzer manufacturing supply chains, which could further reinforce its position as hydrogen infrastructure expands globally.
Together, China and Europe are projected to account for around half of additional renewable electrolysis capacity expected by 2030. DNV forecasts global renewable electrolysis-based hydrogen production capacity increasing from approximately 1.5 million tonnes annually in 2025 to around 10 million tonnes by 2030.
Even that near-term growth trajectory remains highly dependent on continued policy support and industrial coordination. DNV warned that certification systems, emissions accounting standards, safety frameworks, and regulatory harmonization remain underdeveloped across much of the market.
Those issues are becoming increasingly important as governments and buyers seek to distinguish between different hydrogen production pathways and associated emissions profiles. Without internationally recognized certification systems and clearer lifecycle accounting standards, cross-border hydrogen trade and investment decisions remain more difficult to scale.
The report also highlighted operational learning as an ongoing challenge. While pilot projects and early commercial facilities are helping improve system design, infrastructure integration, and safety procedures, the industry still lacks the long operational track record associated with more mature energy technologies.
