of electrolyser capacity committed in 2025, well below the 30-58 GW envisaged for 2030.
European hydrogen markets
2026 Monitoring Report
ACER’s 2026 Monitoring Report on European hydrogen markets finds that the EU’s capacity to produce hydrogen from electricity is growing but remains well below 2030 ambitions. Despite hydrogen’s role in EU decarbonisation pathways, investment is held back by high costs, policy uncertainty and difficulties in securing firm, long-term demand in some sectors.
The report examines investment in electrolysers (used to produce hydrogen from water using electricity), national implementation of EU hydrogen rules, demand across hydrogen-consuming sectors, infrastructure development and the role of public funding. It also explores how industrial policy choices will shape the future of hydrogen in Europe.
What trends did ACER monitoring find?
- Electrolyser capacity is growing, but far below 2030 ambitions. Operational electrolysis capacity reached 490 MW at the end of 2025, almost six times the 2020 level, but still less than 1% of EU hydrogen production capacity. Committed projects (operational, under construction or approved for investment) total 4.2 GW, enough to cover 10% of current EU hydrogen demand once operational. This is well below the 30-58 GW envisaged for 2030 in national strategies and EU scenarios.
- Demand for hydrogen has declined slightly since 2022 and its future will depend on industrial policy choices. In 2025, EU hydrogen demand reached 7.3 million tonnes, a 3% decline since 2022. Uptake of renewable and low-carbon hydrogen will depend on the future of EU fertiliser, chemical, steel and fuel production, and on whether the EU makes hydrogen, intermediate products and final goods itself or imports them.
- Investment depends on recovering the higher renewable hydrogen cost. Conventional fossil-based hydrogen is still cheaper and sectors differ in how much of this extra cost they can absorb or pass on. Almost half (49%) of committed electrolyser capacity is in refining, where obligations and associated penalties apply. Uptake is slower in other sectors (e.g. ammonia, methanol, aviation, steel and maritime).
- Public funding helps but does not guarantee investment. All 15 of the largest committed electrolyser projects examined received EU or national support. Funding can narrow the cost difference with fossil-based hydrogen, but finding long-term buyers remains a constraint.
- Infrastructure is advancing slowly and unevenly. Germany, the Netherlands and Belgium lead pipeline deployment. Between January 2025 and June 2026, 622 km of new or repurposed hydrogen pipelines were commissioned in the EU. While most storage and import terminal projects are still at an early stage.
- National implementation is lagging. The EU hydrogen regulatory framework is largely complete. However, Member States have not yet fully transposed and implemented the revised Renewable Energy Directive (REDIII) and the Hydrogen and Decarbonised Gas Package. For the latter, only one country has completed the process, and eleven are partway through. Uncertainty about EU policy beyond 2030 also makes long-term investment decisions harder.
ACER identifies some policy considerations to address the challenges.
Member States and the European Commission:
- Clarify the future role and scale of hydrogen-consuming industries in the EU, balancing competitiveness, resilience and decarbonisation. This includes choices about domestic production and imports of hydrogen, intermediate products and final goods.
- Recalibrate EU and national deployment ambitions to reflect actual progress and realistic pathways, and provide policy clarity beyond 2030.
- Target EU and national funding at mature projects and sectors where support can cost-effectively create firm, long-term demand.
Member States and national regulatory authorities:
- Complete national implementation of EU rules, give national regulators clear hydrogen responsibilities, certify hydrogen network operators and coordinate national rules.
Hydrogen network operators, with Member States and regulators:
- Develop hydrogen networks incrementally, using realistic and regularly updated demand and supply assumptions.
European hydrogen markets
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Highlights
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4.2 GW
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~49%
of committed electrolyser capacity is for supplying refineries, driven by transport obligations and penalties.
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1 of 27
Member States has fully adopted the EU’s new hydrogen and gas rules into national law (11 partially).
Report
ACER’s 2026 Hydrogen Monitoring Report:
- examines the latest hydrogen developments across supply, demand, infrastructure, public support and regulatory framework; and
- highlights the main regulatory and market challenges across the EU.
Infographic
Interested in the main highlights of the report?
Webinar
ACER will hold a webinar to present the main findings of this report.
When?
Tuesday 1 December 2026 at 10:00 CET.
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