by Power-to-gas technology allows renewable power generated from sources like wind and solar to be transformed into a gas fuel, like hydrogen, to be stored and transported through existing natural gas infrastructure or used as transportation fuel. Power-to-gas plays an important role in energy storage by converting unused renewable electricity into hydrogen or renewable natural gas, allowing excess renewable energy that would otherwise go to waste to be stored for later use. The technology enables balancing of energy systems with increasing shares of variable renewable energies and promotes sector coupling by utilizing the produced hydrogen or methane in other sectors like transport, heating, industry etc.
The global Power-to-Gas Market is estimated to be valued at US$ 33.96 Bn in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
The increasing flexibility needs of power grids emerging from renewable energy integration is one of the major trends driving the growth of the power-to-gas market. Renewable energy sources like solar and wind are intermittent in nature which causes instability in power grids. Power-to-gas helps in balancing the power grids by converting excess renewable electricity into hydrogen or methane during high renewable electricity generation periods which can be used during low renewable electricity generation. This improves the flexibility of power grids to accommodate higher shares of renewable electricity.
Porter’s Analysis
Threat of new entrants: The power-to-gas market has high initial capital costs for setting up projects, limiting new companies from entering easily.
Bargaining power of buyers: Power-to-gas technology is still emerging, so buyers have fewer options to choose from and lower bargaining power.
Bargaining power of suppliers: Key equipment and infrastructure required have few global manufacturers, giving them bargaining power over buyers.
Threat of new substitutes: Alternatives like power-to-liquid and chemical storage are in development stages but not direct substitutes in the short run.
Competitive rivalry: Major players are collaborating to build value chains and commercialize the technology, slightly reducing rivalry for now.
Key Takeaways
The Global Power-To-Gas Market Size is expected to witness high growth over the forecast period. Power-to-gas technology enables excess renewable energy to be stored in the natural gas grid and used for various applications, supporting the energy transition.
Regional analysis: Europe dominates currently with many projects underway in Germany. Government incentives and initiatives are driving adoption across countries like France and Netherlands. Asia Pacific is also emerging as China and India formulate policies to deploy the technology commercially.
Key players: Key players operating in the power-to-gas market are Kimberly-Clark Corporation, Essity AB, Georgia-Pacific LLC, Asia Pulp and Paper Group, Procter & Gamble Co., Sofidel Group, CMPC Tissue S.A., WEPA Hygieneprodukte GmbH, Metsä Group, Cascades Inc. Players are investing in scaling up facilities and developing integrated value chains to leverage the growth opportunity. Collaborations along the supply chain are also witnessed to commercialize projects.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
