PEM capacity growth revised downward in IEA update, dampening platinum demand despite rising electrolysis

The International Energy Agency’s (IEA) annual outlook for hydrogen electrolyser projects in 2025 shows an evolving landscape. The most significant changes are to the number of pre-2030f projects being deferred to post-2030 and a mild technology shift towards alkaline. Accordingly, platinum demand from electrolysis from 2026f to 2030f is expected to be 12% lower than in our projections last year, reaching 172 koz p.a. by the end of the decade.

The IEA hydrogen production projects database details operational and proposed electrolyser plans globally. The database is updated annually, with the following key highlights from the 2025 edition (relative 2024).

·            The total number of hydrogen projects expected to be commissioned by 2040f has increased by 9% (Fig. 3),

·            The cumulative electrolyser capacity has increased by 8% (Fig. 4) due to a greater number of projects, however

·            Average project sizes have declined by 1%.

Despite the IEA recording growing electrolysis ambitions, green hydrogen continues to face implementation headwinds stemming from high costs, regulatory uncertainty and infrastructure bottlenecks. Recognising these challenges WPIC applies a probability success factor against the IEA project list to reflect the likelihood that a project reaches commissioning. The less advanced a project’s status is (e.g. conceptual study versus construction phase), the lower the likelihood it successfully commissions. 

Figure 1. Projects deferrals see near-term downgrades partially offset by longer term upgrades

Figure 2. Near-term platinum demand declines with PEM, rebounding by 2030 as deferred projects come online

After applying these weightings, WPIC expects total cumulative electrolysis capacity to reach 225 GW by 2040f, a 6% increase versus the 2024 database, but well below the ~1,100 GW of project capacity listed by the IEA (Fig. 4). The upward revisions to total electrolyser capacity masks trends across pre- and post-2030f time frames. Due to ongoing industry challenges, electrolysis capacity forecasts have been reduced by 24% from 2025f to 2029f (Fig. 1) as projects are deferred or cancelled.

In addition to project timelines, the IEA database shows evolving electrolysis technology preferences. The revised databased highlights a rising relative proportion alkaline adoption, stable PEM adoption and a declining proportion of unallocated technology choices (Fig. 6). This suggests that a growing portion projects with undecided technology may adopt alkaline which mostly do not use PGMs. We expect this technology shift combined with medium-term project deferrals to reduce platinum demand by 12% from 2026f to 2030f (Fig. 2). Hydrogen in totality remains a compelling growth story with the segment accounting for <1% of total platinum demand in 2025f but increasing to 4% by 2030f.

Figure 3: Total announced projects are up 9% YoY

Figure 4: IEA announced project capacity is up 8% YoY, WPIC probability adjusted built* capacity is up 6% YoY

Figure 5: Average probability adjusted individual project sizes have decreased by 5%, with RoW hosting the largest projects and Europe the smallest

Figure 6: The share of alkaline electrolysis to 2030 has increased by 4% reducing PEM market share

Figure 7: Most electrolysis platinum demand is expected to come from Europe and Rest of the World, making up ~81% of cumulative platinum demand

Figure 8: Overall, this has pushed ‘hydrogen stationary and other’ platinum demand out to 2030f to 312 koz, accounting for ~70% of platinum demand from hydrogen

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