Hydrogen Technology Testing, Inspection, and Certification Market Trends

Market Driver - Rising Demand for Clean Energy Resources, Including Hydrogen, to Decarbonize Industries.

With growing concerns over climate change and global efforts to reduce carbon emissions, transitioning to clean and renewable sources of energy has become a top priority for governments and industries across the world. One such promising clean technology that is gaining significant attention is hydrogen. As one of the most abundant elements on earth, hydrogen has the potential to help countries and organizations lower their carbon footprint in a sustainable way. It can be used as an alternative to fossil fuels in multiple hard-to-abate sectors like heavy-duty transportation, steel and chemical industries where direct electrification or use of battery-based solutions is not feasible.

Many experts believe that large-scale blending and use of hydrogen, especially green hydrogen produced via renewable electricity, can help substantially cut carbon emissions from these emission-intensive industries. This is turning the focus towards developing reliable infrastructure and supply chains for mass production and distribution of hydrogen on an industrial level. However, as the hydrogen economy is still in a developing and expanding stage, it is important to have robust testing, inspection and certification processes in place to ensure that hydrogen equipment, components and systems utilized in industrial projects perform as per the desired safety, quality and reliability standards.

Strict quality control and compliance with technical specifications would be critical for building customer confidence and trust in emerging hydrogen technologies. It would also help address potential risks and prompt remedial action wherever needed to advance the development of hydrogen applications in a responsible manner. As more companies proactively work on integrating clean hydrogen into their processes and transitioning their plants to run on hydrogen, the demand for third-party certification services by experts is expected to steadily rise in the coming years. This indicates promising prospects for hydrogen TIC providers to play an active role in enabling a smooth shift to hydrogen-based systems.

Market Driver - Increasing Investments by Governments and Industries in Hydrogen Technologies, Especially in Transportation and Power Generation

With decarbonization emerging as an urgent global priority, governments around the world have been rolling out ambitious policies and injecting large funding to drive the commercialization of green technologies like hydrogen. Major economies in both developed and developing world have announced multi-Bn dollar investment plans dedicated for research, infrastructure development and demonstration projects in the hydrogen sector. On the industry front as well, leading energy and transportation companies have substantially increased their capital expenditure towards building fuel cell vehicles, hydrogen electrolyzers, refueling stations and exploring options of hydrogen blending or co-firing in gas pipelines and power plants.

This rising tide of investments is a clear sign that hydrogen is increasingly being viewed as a key pillar of long-term zero-emission strategies, especially in hard-to-abate domains of transportation and power generation. In transportation, countries worldwide are targeting commercial roll-out of fuel cell vehicles and scaling up of hydrogen refueling infrastructure to provide a cleaner alternative to conventional vehicles. Moreover, leveraging hydrogen's ability to store and transport energy is seen as an important way to boost flexible renewable power generation capacity and enhance grid reliability. With billons of dollars committed towards deploying innovative hydrogen projects across diverse applications and geographies, demand for experienced technical experts is expected to accelerate.

Meeting stringent certification requirements would be critical for new hydrogen systems and assets to get necessary approvals and safely deliver low-carbon operations. This presents a solid business case for TIC companies to grow their footprint and specialist skills alongside expanding hydrogen value chains. As more funding flows in and players from different sectors join the hydrogen economy, certification services are poised to play a key facilitating role in building confidence and credibility around hydrogen's viability as a mainstream energy alternative of the future.

Market Challenge - High Cost and Complexity of Infrastructure Development for Hydrogen Storage and Transport Challenges Large-Scale Deployment

The development of infrastructure for large-scale hydrogen storage and transport presents major economic and technical challenges for the growth of the hydrogen technology testing, inspection, and certification market. Setting up the necessary pipelines, storage tanks, and transportation networks for hydrogen involves very high initial capital investments. Hydrogen has low density in gaseous form and requires compression, cooling, or conversion to liquid form for effective storage and handling. This infrastructure development is further complicated by challenges such as material constraints, safety issues, and the need for specialized procedures and equipment. Building hydrogen refueling stations also entails significant costs. All of these factors contribute to make infrastructure development for hydrogen a complex and expensive undertaking. Until cost-effective solutions are found for infrastructure challenges, the scope for market expansion of hydrogen technology testing services will remain limited due to constraints in the large-scale deployment of hydrogen technologies.

Market Opportunity: Growing Emphasis on Producing Green Hydrogen and the Expansion of Green Energy Projects Worldwide, Driving Demand for Testing and Certification Services

The rising focus on generating hydrogen through renewable energy sources like electrolysis is a major opportunity for growth in the hydrogen technology testing, inspection, and certification market. Many countries are investing heavily in green hydrogen projects as part of their climate action plans and energy transition goals. The proliferation of large green hydrogen plants and ammonia facilities worldwide will lead to a surge in demand for testing and certification services during the construction, commissioning and operating phases of these facilities. Additionally, the expansion of wind and solar power capacity also provides opportunities for integrated green hydrogen production using surplus renewable energy. The increasing need to ensure reliability, efficiency and safety standards in green hydrogen value chains can drive significant future revenues for testing, inspection and certification providers. This represents a promising avenue for market expansion.