Hydrogen prices for the industry

By 2045, green hydrogen will become significantly cheaper and approach the prices of fossil-based blue hydrogen. This is shown by our study for the Bavarian Industry Association (vbw), in which we estimated future prices for hydrogen.

Our study presents the costs of supplying hydrogen to industrial consumers and analyses the key factors influencing these costs.

Green hydrogen will become more competitive in the long term

There are two routes for low-greenhouse-gas hydrogen that have the necessary technical maturity for a market ramp-up:

• green hydrogen from water electrolysis using renewable electricity
• blue hydrogen from natural gas with CO₂ capture

These two routes have different advantages and disadvantages. In the market ramp-up phase, when there is increasing demand for low-greenhouse-gas hydrogen and it is produced in large quantities, these routes can complement each other.

Due to learning rates and economies of scale, the cost of green hydrogen is expected to fall significantly by 2045, bringing it closer to the cost of blue hydrogen. However, green hydrogen is likely to remain slightly more expensive.

What influences the prices of green and blue hydrogen

The hydrogen costs for industrial customers are made up of various components: production costs, domestic and international transport costs, and storage costs. However, the various cost components have different weights for blue and green hydrogen.

Important factors influencing the price of green hydrogen are:

• Low electricity procurement costs: Electricity is the most important cost component (from 43 per cent in 2030 to up to 79 per cent of the hydrogen price in 2045).
• Cost reductions in electrolysis technologies: These can be achieved through economies of scale, automation, industrialisation and technical developments.
• Maximum possible full utilisation hours for electrolysis: This reduces the production costs for hydrogen, all other conditions being equal.

Important factors influencing the price of blue hydrogen are:

• Natural gas costs (including transport): Natural gas is the most important cost component, accounting for 34 per cent to 48 per cent.
• CO₂ capture rates: Autothermal steam reforming plants, for example, enable CO₂ capture rates of up to 90 per cent.
• CO₂ storage and its costs: The captured CO₂ incurs costs for transport and permanent storage.

Our approach

The estimation of future hydrogen prices for industrial companies is based on extensive preliminary work and findings that Prognos has gained in other projects.

Links and downloads

To the study (PDF, in German)

Further information (vbw website, in German)

Project team: Hans Dambeck, Sven Kreidelmeyer

Last update: 24.09.2025