More than 570 hydrogen projects have reached final investment decision, representing over USD 130 billion in committed capital and around 6.9 million tonnes of annual production capacity. Energy and food system security are emerging as major drivers of the sector.
The Global Hydrogen Compass 2026
Hydrogen investments continue to grow. After several highly dynamic early years, the sector has faced a series of challenges, starting with estimated demand falling short of supply and costs declining more slowly than expected.
Yet growth remains clear. New concerns over energy security, combined with a conflict affecting around one-sixth of global H2 production, have pushed total investment in hydrogen production projects that have reached final investment decision above USD 130 billion.
The figure covers more than 570 projects, including facilities under construction or already operating, with a combined production capacity of around 6.9 million tonnes per year (Mtpa).
Of this total, 3.7 Mtpa is low-carbon hydrogen, produced from natural gas with carbon capture, while 3.2 Mtpa is renewable hydrogen generated through electrolysis.
The figures come from the Global Hydrogen Compass 2026, prepared by the Hydrogen Council in collaboration with McKinsey & Company to provide a detailed analysis of the sector.
A quick look at the report shows how the conflict in the Middle East has added urgency to the market. Energy security and food system security concerns could become two of the main drivers of future hydrogen investments, potentially outweighing decarbonisation alone.
“Operational capacity has nearly doubled in the past 12 months, and CEOs around the world remain focused on project delivery, with 70% of those surveyed for this report indicating that their investment appetite has remained steady or increased,” the Council writes.
The figures, however, should be treated with caution. Hydrogen has experienced temporary waves of enthusiasm before, and the sector has yet to prove that it can establish sustained long-term growth, particularly on the demand side.
The report estimates potential clean hydrogen demand of 11 Mtpa by 2030, but only 6 Mtpa is currently secured through dedicated policies or binding contracts.
For African markets, where energy security is also a central concern, these global investment trends are particularly relevant to the wider debate around resilient and diversified energy systems.
Who is leading hydrogen investments?
As in almost every technology segment of the energy transition, China is far ahead in hydrogen. Beijing leads global hydrogen investments with USD 44.5 billion and also ranks first for committed production capacity, with 1.9 Mtpa across large-scale projects.
Supported by a highly competitive market and economies of scale, China’s industry has reduced the cost of alkaline electrolysers to below USD 350/kW in five years and now controls 60% of the market.
This has helped bring renewable hydrogen production costs to around USD 3.5/kg today, with the potential to fall to USD 2/kg by 2030. China also has the world’s largest fleet of fuel-cell vehicles, with more than 32,000 vehicles.
Europe is the second-largest market for committed hydrogen investments, at around USD 30 billion, but ranks first by total number of projects. Its 232 projects represent approximately 1 Mtpa of committed capacity, reflecting the smaller average size of European facilities.
Europe is also the world’s leading demand centre for renewable hydrogen, or RFNBOs. Renewable hydrogen production costs in Europe remain between USD 5 and USD 9/kg.
North America dominates the low-carbon, or blue hydrogen, segment. The region accounts for around USD 26 billion in hydrogen investments and a record 2.9 Mtpa of committed production capacity.
Next in the investment ranking is the Middle East, specifically Saudi Arabia, the United Arab Emirates and Oman, with USD 11 billion concentrated in just 15 gigawatt-scale megaprojects. Together, they represent around 500,000 tonnes of hydrogen production per year.
They are followed by Japan and South Korea with USD 7 billion, and India with USD 6 billion, largely directed towards H2 production for domestic renewable ammonia synthesis.
The scale and geographic spread of these investments also matter for Africa and other emerging energy markets as the global hydrogen industry moves from project announcements towards implementation.
“The experience of leading markets also points to the sector’s next challenge,” write the Council’s co-chairs, Jaehoon Chang, Vice Chair of Hyundai Motor Group, and François Jackow, Chief Executive Officer of Air Liquide.
“Existing policies could unlock around 11 million tonnes per year of clean hydrogen demand by 2030. Around 6 million tonnes of this demand is already secured through policy measures that have been adopted and implemented. The remaining 5 million tonnes do not require a technological breakthrough, a new strategy or a new commitment. They are waiting for the determined and consistent implementation of existing policy commitments, such as the full transposition of RED III targets and the implementation of robust carbon pricing mechanisms such as the ETS and CBAM in Europe. Every month of delay in implementing these measures is a month of unrealised investment.”
