Last year, Korea made a significant leap in the hydrogen fuel cell market by becoming the first country in the world to surpass 1GW in the cumulative installation of fuel cells for power generation. This achievement places Korea at the forefront of the global hydrogen market, outstripping the United States and Japan in installation volume.
The Korea Hydrogen Fuel Cell Industry Association and the Korea Power Exchange reported that the total fuel cell capacity installed for power generation in Korea reached 1,036 MW by the end of last year. This rapid growth in fuel cell installations is a testament to Korea’s dominance in the market, which now accounts for nearly half of the world’s fuel cell supply.
Fuel cell power plants, known for their eco-friendliness, generate electricity and heat through an electrochemical reaction between hydrogen and oxygen. Unlike solar and wind power, fuel cells are unaffected by climatic conditions and do not face intermittency issues. Their low noise and vibration levels make them suitable for both industrial complexes and urban settings, highlighting their potential as a distributed power source.
Consequently, major domestic companies are increasingly entering the fuel cell market. The global market for power generation is currently led by Doosan Fuel Cell and Bloom SK Fuel Cell. Doosan Fuel Cell produces phosphoric acid fuel cells (PAFC) with high thermal and electrical efficiency, while Bloom SK Fuel Cell specializes in solid oxide fuel cells (SOFC) known for their electrical efficiency.
Following the opening of the hydrogen power generation bidding market in Korea, these companies are expanding their production capabilities. Doosan Fuel Cell has increased its PAFC production facilities to 275 MW and added SOFC facilities of 50 MW. Similarly, Bloom SK Fuel Cell has also expanded its SOFC production facilities to 200 MW.
Despite these developments, the fuel cell industry is facing challenges. The industry points out that the government’s policies to expand hydrogen fuel cells have not met expectations. The volume of bids for general hydrogen power generation is only 200 MW per year, significantly lower than the industry’s anticipated demand. The Ministry of Trade, Industry and Energy set the bidding volume for the general hydrogen power generation market at 1,300 GWh per year from 2023 to 2025, equivalent to about 200 MW in facility capacity.
The industry believes that to match the recent expansion in manufacturers’ production capacity, bidding for more than 600 MW per year is necessary. An industry official expressed concerns, stating that despite the apparent boom, domestic demand is lower than expected, leading to halts in some manufacturing plant operations.
To maintain its global leadership in the market and further capitalize on its potential, Korea needs to expand its domestic general hydrogen power generation bids and actively promote fuel cells as a distributed energy resource.
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