IEA Releases Global Hydrogen Review 2026
The International Energy Agency (IEA) released its Global Hydrogen Review 2026 on May 26, assessing the latest developments in the global low-emission hydrogen sector and proposing policy recommendations for accelerating industry deployment. The report highlights that geopolitical tensions, sluggish demand growth, regulatory uncertainty, and infrastructure bottlenecks continue to constrain large-scale commercialization despite ongoing capacity expansion.
Key Findings
1. Middle East Conflict Disrupts Global Hydrogen-Based Commodity Supply Chains
The escalating conflict in the Middle East has significantly disrupted the production and international trade of hydrogen-derived commodities. The region accounts for approximately one-sixth of global hydrogen production and more than one-quarter of global trade in ammonia, urea, and methanol.
Production outages, attacks on port infrastructure, and the closure of the Strait of Hormuz have substantially constrained exports of hydrogen-based products, tightening global supplies of fertilizers, refined petroleum products, and chemical feedstocks. Between January and May 2026, international urea prices doubled, increasing agricultural production costs and posing additional food security risks for countries heavily dependent on fertilizer imports.
2. Hydrogen Can Enhance Energy Security but Offers Limited Short-Term Relief
Low-emission hydrogen has the potential to diversify energy supply by replacing natural gas- and coal-based hydrogen production and supporting the production of fertilizers, methanol, sustainable marine fuels, and sustainable aviation fuels. In the long term, hydrogen can reduce dependence on conventional fossil fuel supply chains.
However, the report emphasizes that global low-emission hydrogen production remains at an early stage of commercialization. Inadequate production capacity, insufficient transportation and distribution infrastructure, and immature supply chains limit hydrogen’s ability to mitigate the current energy and hydrogen-derived product shortages in the near term.
3. Global Low-Emission Hydrogen Production Continues to Grow, While Market Fundamentals Remain Fragile
Global hydrogen demand exceeded 100 million tonnes (Mt) in 2025, with consumption still concentrated in traditional sectors such as refining and industrial feedstock production.
Production of low-emission hydrogen increased by approximately 20%, approaching 1 Mt, although output remains highly concentrated in a limited number of commercial projects.
The report identifies high production costs, insufficient market demand, regulatory uncertainty, and inadequate infrastructure as the principal barriers to large-scale deployment.
4. Outlook to 2030 Weakens Amid Regional Divergence
The near-term outlook for low-emission hydrogen has deteriorated due to delayed investment decisions and project cancellations.
The projected capacity of all announced projects by 2030 has declined to approximately 27 Mt. Among these, projects that are under construction or considered highly likely to become operational before 2030 have fallen from 10 Mt to just over 6 Mt.
An additional 22 Mt of potential production capacity requires final investment decisions by early 2027 to remain on track for commissioning before 2030.
Electrolyser deployment continued to accelerate, with global installed capacity more than doubling to over 4 GW in 2025. China contributed nearly three-quarters of newly installed capacity, although industry consolidation is accelerating as a result of manufacturing overcapacity and intense price competition.
Europe’s first wave of large-scale projects is expected to enter operation in 2026, while slow policy implementation and regulatory uncertainty continue to delay market expansion. North American projects remain largely export-oriented, with commercial viability depending heavily on overseas demand. In India, several projects have secured offtake agreements, although investment remains subject to uncertainties surrounding government incentive schemes.
5. Insufficient Demand Has Become the Primary Constraint on Industry Growth
Approximately 1.7 Mt of new low-emission hydrogen purchase agreements were announced in 2025. However, only around 20% have evolved into legally binding contracts.
Most confirmed demand originates from refining, chemicals, and power generation. For the first time, international trade-related purchase agreements exceeded those intended for domestic consumption.
Based on projects that have already reached final investment decisions, refineries and industrial facilities are expected to consume approximately 2.5 Mt of low-emission hydrogen by 2030, representing around 60% of confirmed global production.
6. Africa Possesses Significant Potential but Faces Financing and Infrastructure Constraints
Africa has abundant renewable energy resources and considerable potential to produce cost-competitive low-emission hydrogen while supporting domestic fertilizer and green steel industries and improving both energy and food security.
Nevertheless, current production remains extremely limited at approximately 6,000 tonnes, and among 31 planned projects expected before 2030, only one has reached a final investment decision.
High financing costs, underdeveloped electricity grids, inadequate transport infrastructure, and limited domestic demand continue to impede project implementation.
IEA Policy Recommendations
To address emerging challenges and accelerate market development, the IEA recommends five priority actions:
1. Update hydrogen strategies and strengthen long-term planning
Governments should revise national hydrogen strategies to reflect changing market conditions, integrate hydrogen and hydrogen-derived fuels into long-term energy security planning, strengthen whole-of-value-chain coordination, and establish adaptive regulatory frameworks.
2. Accelerate policy implementation to stimulate demand
Policy instruments—including production subsidies, demand quotas, mandatory blending requirements, and green public procurement—should be deployed to expand hydrogen consumption, particularly in existing industrial applications such as refining and chemical manufacturing.
3. Maintain support for production and prioritize bankable projects
Given the persistent cost premium of low-emission hydrogen, governments should maintain stable financial support mechanisms and regulatory certainty while prioritizing commercially mature, scalable projects capable of narrowing the cost gap with conventional fossil-based hydrogen.
4. Improve regulatory frameworks, financing mechanisms, and infrastructure deployment
Governments should streamline permitting procedures, strengthen cross-sector coordination, reduce early-stage infrastructure investment risks, and promote integrated hydrogen hubs centered on industrial clusters and port facilities.
5. Support emerging economies in moving up the hydrogen value chain
Through international cooperation, developed economies should assist emerging markets in improving access to finance, expanding infrastructure, and developing both domestic and export markets for low-emission hydrogen applications, particularly in fertilizer production. Such efforts would reduce dependence on imported energy and fertilizers while enhancing energy security, food security, and sustainable economic development.
Source：
[1]https://www.iea.org/reports/global-hydrogen-review-2026
[2]https://mp.weixin.qq.com/s/9CuBsBO8nYD6HfVfcsVshg