Grey Hydrogen: The Unsung Hero of the Refinery Revolution

2025-09-12 industry

London, Friday, 12 September 2025.
Grey hydrogen, expected to soar from USD 147.9 billion to USD 250.2 billion by 2035, remains a cost-effective staple in refineries despite a green shift. Its reliability keeps it reigning supreme.

The Current Market Landscape

As of today, the grey hydrogen market is valued at USD 147.9 billion and is projected to reach USD 250.2 billion by 2035, with a compound annual growth rate (CAGR) of 5.4% [1]. This growth is largely driven by its indispensable role in petroleum refining, where it aids in processes like hydrocracking and desulfurization [2]. It’s like the reliable old friend you can always count on, even as everyone else is making new acquaintances with green and blue hydrogen alternatives.

Why Grey Hydrogen is Still in the Game

Despite the global push towards greener energy solutions, grey hydrogen holds its ground due to its cost-effectiveness and operational reliability [3]. The cost of producing grey hydrogen remains competitive, ranging from USD 0.8 to USD 4.6 per kilogram, compared to the higher costs of green hydrogen production [4]. This makes grey hydrogen an attractive option for refineries that need to maintain efficiency without breaking the bank.

Geopolitical Dynamics and Regional Growth

Geographically, North America, Asia-Pacific, and Europe are the key growth regions for grey hydrogen. China, in particular, leads the market with a projected CAGR of 7.3% from 2025 to 2035, driven by its increasing demand for low-sulfur fuels [5]. This is like a race where China is sprinting ahead, with India and Germany not too far behind, showcasing their own impressive growth rates of 6.8% and 6.2%, respectively [6][7].

Challenges and Future Outlook

The grey hydrogen market isn’t without its challenges, though. The transition to low-emission fuels and the adoption of clean hydrogen technologies are pressing concerns [8]. However, the reliability of grey hydrogen in current refining processes ensures it remains a mainstay. The future might be green, but for now, grey hydrogen’s role is as solid as ever, providing the backbone for the petroleum refining industry [9].

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grey hydrogen petroleum refining