How can I invest in green hydrogen production and infrastructure?

This comprehensive guide has been written by the team who has mapped the green hydrogen market in a clean and beautiful presentation

The green hydrogen market presents a transformative investment opportunity worth $30.6 billion by 2030, growing at 61.1% annually as governments commit over $100 billion in subsidies and industrial players scale electrolysis technologies.

Major corporations from BP to Microsoft are pouring billions into hydrogen infrastructure, while startups like Electric Hydrogen achieve unicorn status with $380 million funding rounds. Smart investors can capture value through direct equity investments, specialized ETFs, and strategic partnerships in this rapidly maturing sector.

And if you need to understand this market in 30 minutes with the latest information, you can download our quick market pitch.

Get a Clear, Visual
Overview of This Market

We've already structured this market in a clean, concise, and up-to-date presentation. If you don't have time to waste digging around, download it now.

DOWNLOAD THE DECK

Which industries are driving demand for green hydrogen right now?

Industrial refining consumes 38% of current hydrogen demand, where green H₂ replaces grey hydrogen in hydrocracking processes, reducing emissions by up to 25% by 2050.

Ammonia production for fertilizers represents the largest near-term opportunity, with companies like CF Industries and Yara investing billions in green ammonia plants. The Haber-Bosch process traditionally produces 180 million tons annually of ammonia, creating immediate demand for clean hydrogen feedstock.

Steel manufacturing through Direct Reduced Iron (DRI) processes is scaling rapidly, with ArcelorMittal and Thyssenkrupp leading $10+ billion investments in hydrogen-based steel production. Heavy transport including buses, trucks, and forklifts provides faster payback periods due to rapid refueling advantages over batteries.

Energy storage and grid balancing applications are emerging as utilities like LADWP retrofit natural gas turbines to burn 30% hydrogen blends by 2025, progressing to 100% hydrogen by 2045.

Where should investors focus geographically for the best policy support?

The United States leads with the Inflation Reduction Act's 45V Clean Hydrogen Production Tax Credit, offering up to $3/kg for hydrogen produced with renewable electricity below 0.45 kg CO₂e/kg lifecycle emissions.

The European Union commits €4.6 billion through the European Hydrogen Bank, with €2 billion allocated in the second auction round for 15 green hydrogen projects. Germany specifically offers contracts-for-difference supporting projects like BP's 100 MW Lingen facility.

China dominates electrolyzer manufacturing with 61% global capacity and targets 50,000-100,000 tons of green hydrogen production by 2025. Japan provides ¥3 trillion ($20 billion) in subsidies for clean hydrogen production and imports, focusing on long-term offtake agreements.

Australia leverages the world's lowest solar costs ($0.013/kWh) and commits A$2 billion through the Hydrogen Headstart program, positioning for large-scale exports to Asia-Pacific markets.

Need a clear, elegant overview of a market? Browse our structured slide decks for a quick, visual deep dive.

If you want fresh and clear data on this market, you can download our latest market pitch deck here

Who are the key players investors should track in 2025?

Electric Hydrogen achieved unicorn status with $380 million Series C funding from BP, Microsoft, and United Airlines, focusing on gigawatt-scale electrolyzer manufacturing targeting sub-$2/kg hydrogen production costs.

Hysata raised A$110 million Series B from BP Ventures and Templewater, developing 95% efficient capillary-fed electrolysis technology. Koloma secured $246 million Series B led by Khosla Ventures for geologic hydrogen extraction from natural underground reservoirs.

Among public companies, Plug Power operates North America's largest hydrogen network with 250+ refueling stations and 60,000+ fuel cell systems deployed. Bloom Energy pivots to data center applications, with 27% of facilities expected to use on-site hydrogen generation by 2030.

Industrial gas leaders Air Liquide (15% global hydrogen production) and Linde ($1.8 billion blue ammonia investment in Texas) provide established infrastructure and customer relationships. Chart Industries and Siemens Energy dominate equipment manufacturing for compression, liquefaction, and electrolysis systems.

How can investors access these companies and what are typical deal structures?

Venture-stage companies typically require $1-5 million minimum investments with accredited investor status and 3-7 year lock-up periods.

Series B/C rounds like Electric Hydrogen's $380 million offer $10-50 million investment minimums for institutional investors, with liquidation preferences and board representation rights. Growth equity deals often include revenue-based financing structures tied to hydrogen production capacity or offtake agreements.

Public companies trade on major exchanges with no investment minimums: Plug Power (NASDAQ: PLUG), Bloom Energy (NYSE: BE), FuelCell Energy (NASDAQ: FCEL), and Air Liquide (EPA: AI). These offer immediate liquidity but higher volatility during the sector's early commercialization phase.

Private placement opportunities include Breakthrough Energy Ventures' $1 billion climate fund and Energy Impact Partners' corporate venture platform, typically requiring $250,000+ limited partner commitments with 10-year investment horizons.

The Market Pitch
Without the Noise

We have prepared a clean, beautiful and structured summary of this market, ideal if you want to get smart fast, or present it clearly.

DOWNLOAD

What were the major funding milestones in 2025?

The hydrogen sector attracted over $1 billion in venture funding during 2025, with Electric Hydrogen's $380 million Series C marking the largest single round.

Notable transactions include Hysata's A$110 million Series B, ZeroAvia's $116 million Series C for hydrogen-electric aviation engines, and Hydrogenious LOHC's €17 million follow-on funding for liquid organic hydrogen carrier technology.

No major hydrogen IPOs occurred in 2025, as most companies remain in scaling phases requiring patient capital. However, several SPACs targeting clean energy infrastructure announced plans for hydrogen-focused acquisitions in late 2025.

Corporate venture arms became increasingly active, with BP Ventures, Microsoft Climate Innovation Fund, and United Airlines Ventures leading multiple rounds. Strategic investments focus on securing offtake agreements and technology partnerships rather than pure financial returns.

Which funds and ETFs provide diversified hydrogen exposure?

Hydrogen-specific ETFs offer concentrated exposure but limited track records given the sector's nascency.

Fund/ETF	Ticker	Strategy & Holdings	Expense Ratio	AUM
Global X Hydrogen ETF	HYDR	25 holdings including Bloom Energy (19.9%), tracks Solactive Global Hydrogen Index	0.50%	$40M
Defiance Next Gen H2 ETF	HDRO	30 stocks generating 50%+ revenue from hydrogen/fuel cells, first US hydrogen ETF	0.30%	$20M
L&G Hydrogen Economy UCITS	HTWO	27 companies across hydrogen value chain, European focus	0.49%	€307M
VanEck Hydrogen Economy	HDRO	MVIS Global Hydrogen Economy Index tracking	0.55%	€54M
Amundi Global Hydrogen ESG	ANRJ	Bloomberg Hydrogen ESG Index with 5.8% top weights	0.45%	€66M

Broader clean energy ETFs like iShares Global Clean Energy (ICLN) and Invesco Solar (TAN) include hydrogen exposure within diversified renewable portfolios, reducing concentration risk but limiting upside capture.

If you need to-the-point data on this market, you can download our latest market pitch deck here

What are the core technologies driving value creation?

Electrolysis technology determines production economics, with PEM (Proton Exchange Membrane) offering faster response times and higher current densities despite higher capital costs.

Alkaline electrolysis provides lower CAPEX ($400-1,400/kW) but requires steady power input, while solid oxide electrolysis (SOEC) achieves 85-95% efficiency using high-temperature steam. Anion Exchange Membrane (AEM) technology promises PEM performance at alkaline costs.

Storage solutions include 350-700 bar compressed gas systems for short-term applications and cryogenic liquid hydrogen (-253°C) for long-duration storage. Liquid Organic Hydrogen Carriers (LOHCs) like Hydrogenious' technology enable ambient-temperature transport using existing infrastructure.

Transport infrastructure spans dedicated pipelines ($1-2 million/km), tube trailer distribution for smaller volumes, and ammonia carriers for intercontinental shipping. Fuel cell systems convert stored hydrogen back to electricity with 50-65% efficiency for grid balancing and backup power applications.

Wondering who's shaping this fast-moving industry? Our slides map out the top players and challengers in seconds.

How should investors evaluate project economics?

Levelized Cost of Hydrogen (LCOH) serves as the primary metric, targeting $2-4/kg for commercial viability versus $1-2/kg grey hydrogen pricing.

LCOH components include electricity costs (60-70% of operating expenses), electrolyzer CAPEX ($400-2,000/kW depending on technology), and capacity factors (40-90% depending on renewable energy source). Projects coupling with 90%+ renewable capacity factors achieve optimal economics.

Revenue models rely heavily on long-term offtake agreements with industrial customers, typically 10-20 year contracts with inflation adjustments. U.S. projects benefit from 45V tax credits worth up to $3/kg, improving project IRRs from 5-8% to 12-15%.

Key risks include grid integration requirements for "hourly matching" under U.S. regulations, water sourcing for high-purity feedstock, and supply chain bottlenecks for critical electrolyzer components including iridium catalysts and Nafion membranes.

What are the main obstacles limiting sector growth?

Regulatory uncertainty around additionality requirements creates project development delays, particularly U.S. 45V rules requiring new renewable generation rather than existing grid power.

Electrolyzer manufacturing capacity constraints limit deployment, with global capacity of 11.9 GW in 2024 versus 295 GW in announced project pipelines. Lead times extend 18-24 months for large-scale systems, creating bottlenecks for 2025-2027 project timelines.

Water availability poses regional constraints, with electrolysis requiring 9 liters of purified water per kg of hydrogen. Desalination integration increases costs by $0.50-1.00/kg in water-scarce regions like the Middle East and Australia.

Certification and traceability standards remain fragmented across jurisdictions, with 37 governments working toward mutual recognition frameworks. ISO 23455 ed. 1 2025 provides GHG methodology but implementation varies significantly by region.

We've Already Mapped This Market

From key figures to models and players, everything's already in one structured and beautiful deck, ready to download.

DOWNLOAD

If you want to build or invest on this market, you can download our latest market pitch deck here

Which business models offer the best returns for new entrants?

Production-as-a-Service (PaaS) models reduce customer CAPEX through third-party ownership of electrolyzer assets, with operators charging $4-6/kg for delivered hydrogen under take-or-pay contracts.

Equipment leasing provides recurring revenue streams while reducing customer capital requirements, particularly attractive for modular electrolyzer systems under 5 MW capacity. Companies like Nel Hydrogen offer operational leases with maintenance contracts bundled.

Offtake agreement structuring includes Contracts-for-Difference (CfDs) that guarantee minimum prices, power purchase agreements (PPAs) with renewable matching requirements, and "three-pillar" models combining hydrogen production, renewable generation, and storage.

Technology licensing offers scalable returns through intellectual property monetization, particularly for breakthrough catalyst formulations, membrane technologies, and system integration software. Royalty rates typically range 3-8% of equipment sales or $0.10-0.30/kg of hydrogen production.

What should investors expect for market expansion through 2026?

Global hydrogen demand could reach 50+ million tons annually by 2030 under IEA net-zero scenarios, requiring $100+ billion in cumulative investment across the value chain.

Technology breakthroughs anticipated include AEM electrolysis commercialization, solid oxide systems achieving 90%+ efficiency, and AI optimization reducing operational costs by 15-25%. Manufacturing scale-up should reduce electrolyzer costs from $1,000/kW to $300-500/kW by 2030.

Policy developments include expanded Clean Hydrogen Hubs funding in the U.S., EU binding renewable hydrogen targets of 42.5% by 2030, and emerging carbon border adjustments that favor clean hydrogen imports.

Infrastructure deployment will accelerate with dedicated hydrogen pipeline networks, cross-border corridor projects like the European Hydrogen Backbone, and integrated renewable-hydrogen production facilities achieving economies of scale.

Looking for the latest market trends? We break them down in sharp, digestible presentations you can skim or share.

How should investors position themselves strategically?

Partnership strategies should target industrial offtakers in steel, ammonia, and refining sectors with existing hydrogen consumption and emission reduction commitments.

Join regional Hydrogen Valleys receiving €80 million in EU auctions, which provide co-location benefits and shared infrastructure costs. Participate in Clean Hydrogen Partnership calls offering €184.5 million under Horizon Europe for demonstration projects.

Leverage accelerator programs including H2 Global's international auction mechanisms, GH2 Summit networks for market intelligence, and national hydrogen councils providing policy advocacy and technical support.

Strategic equity positions should focus on electrolyzer startups with differentiated technology (Hysata's efficiency advantages), established players with strong balance sheets (Air Liquide, Linde), and emerging platforms integrating multiple value chain components (Electric Hydrogen's gigafactory approach).

Conclusion

Sources

1. Plug Power - Green Hydrogen Applications
2. UNIDO - Green Hydrogen Applications in Industrial Parks
3. H2 Tools - Hydrogen Applications
4. Dametis - Green Hydrogen in Industry
5. NHO - Hydrogen Subsidy Regimes
6. ESG Today - Hysata Funding
7. Carbon Credits - Hydrogen VC Funding
8. Global X ETFs - HYDR Factsheet
9. JustETF - Hydrogen Investment Guide
10. IEA - Global Hydrogen Review 2024
11. Markets and Markets - Green Hydrogen Market Report
12. US News - Green Hydrogen Stocks and ETFs
13. The Motley Fool - Hydrogen Stocks
14. Carbon Credits - Top Hydrogen Startups 2025
15. StartUs Insights - Hydrogen Technology Startups
16. Tracxn - Hydrogen Production Startups
17. Defiance ETFs - HDRO
18. PwC - Green Hydrogen Economics
19. Markets and Markets - Hydrogen Business Models
20. Deloitte - Clean Hydrogen Business Models
21. Energies Media - Hydrogen Investment 2025
22. Nasdaq - Green Hydrogen Investment Opportunity
23. Wood Mackenzie - Hydrogen 2025 Outlook