Hydrogen production: how does it work?
Can hydrogen be a vehicle for the energy transition? Yes, but under certain conditions, when it comes to production. Here’s an overview of the different hydrogen production technologies, and their associated color codes.
The most widespread hydrogen production method: carbon-based hydrogen
According to the International Energy Agency (IEA), the global hydrogen market represents around 100 million tonnes produced per year. The problem is that the overwhelming majority of hydrogen production is based on fossil fuels. As a direct consequence, the technical processes used to produce hydrogen
Schematically, they are therefore composed of hydrogen and carbon. By separating the molecules, we obtain dihydrogen (H2), commonly known as “hydrogen”, but we leave out the carbon which, if recomposed with oxygen from the air, forms CO2. So much for the chemical part.
Approx. 99
The share of carbon-based hydrogen in total world production in 2024
Source: IEA
There are two main technical processes for producing hydrogen from fossil fuels:
- The most widespread is steam reforming of natural gas. In this case, we speak of
grey hydrogen . This technology is used for around 60% of the volumes produced worldwide. - Hydrogen can also be produced by coal gasification. This is known as
brown hydrogen (if produced from coal) orblack hydrogen (from lignite). This technology accounts for around 20% of the volumes produced worldwide each year.
Lastly, the balance of the volumes produced worldwide (around 20%) comes from by-products, i.e. hydrogen produced during an industrial process whose main function is not to produce this hydrogen.
To become a useful vector in the energy transition, hydrogen production must beCO2-free. The good news is that, while the volumes produced are very limited, the technologies exist and are just waiting to be deployed on an industrial scale.
The rarest: natural hydrogen
White hydrogen (or natural hydrogen) refers to hydrogen extracted from the subsoil in its natural form, but there is currently only one white hydrogen production site in the world, in Mali. In 2022, France recognized white hydrogen as a natural resource in its mining code. At the end of 2023, the public authorities authorized for the first time the search for white hydrogen reserves in the Pyrénées-Atlantiques region. Finally, in June 2025, IFP Energies Nouvelles submitted a report to the public authorities on the state of knowledge on natural hydrogen. According to the institute, France has proven white hydrogen potential in the Aquitaine Basin, the Pyrenean Piedmont and the Lorraine coal basin, as well as in New Caledonia… without, however, estimating potential volumes at this stage.
The most virtuous: decarbonated hydrogen
Three technologies can produce hydrogen without emitting CO2:
- Blue hydrogen is produced from natural gas (i.e. from grey hydrogen at this stage), but with a carbon capture, utilization and storage ( CCUS) device. For the sake of completeness, the even more confidentialturquoise hydrogen is produced by the chemical separation of fossil fuels, producing solid carbon which is not emitted into the atmosphere.
- L’green hydrogen is produced by electrolysis of water. In this case, an electrolyzer will separate the molecules of water (H2O) to create dihydrogen (H2), releasing only oxygen. In the case of green hydrogen production, the electrolyzer is powered by electricity from renewable sources (onshore wind, offshore wind or photovoltaic solar power, for example).
- Yellow hydrogen , also known as pink hydrogen, is also produced by electrolysis of water, but in this case the electrolyzer is powered by electricity generated by nuclear power plants.
For the year 2024, the IEA estimates that global low-emission hydrogen production will come from more than 50% blue hydrogen (from natural gas with CCUS) and less than 50% green hydrogen (from electrolysis powered by renewable electricity).
1 million tonnes
Estimated global production of low-emission hydrogen in 2024 (+50% on 2021)
Source: IEA
Finding a business model for carbon-free hydrogen production
Of course, progress can be made, but on the whole, current technical processes have been mastered. The main obstacle to the development of carbon-free hydrogen is not technological, but economic.
Of course, the production costs of grey hydrogen depend directly on the price of natural gas (which can be highly volatile on wholesale markets, as witnessed by the price explosion in Europe in 2022) and the level of CO2 taxation (on the EU-ETS carbon market, for example). The cost of producing blue hydrogen also depends directly on gas prices, but also on the cost of CCUS technologies. Finally, the production costs of green and yellow hydrogen vary according to the cost of renewable energies and nuclear electricity respectively. But there could still be a factor of 2 or even 3 between the cost of producing grey hydrogen and that of green hydrogen, for example… which raises the question of subsidies for the decarbonized sector to enable it to take off.
In April 2025, France updated its national hydrogen strategy, known as “SNH II”:
- Targets for the installation of electrolysis capacity have been revised downwards to 4.5 GW in 2030 and 8 GW installed in 2025 (compared with 6.5 GW in 2030 and 10 GW in 2035 respectively in the first version of the “SNH I” national hydrogen strategy).
- A support mechanism for low-carbon hydrogen production worth 4 billion euros over 15 years.
- The relaunch of the “IDH2 Hydrogen technology bricks” call for projects launched by ADEME.
For the moment, however, the French hydrogen electrolysis production sector has not really taken off, as shown by the installed capacity of 35 MW at the end of 2024 (compared with 30 MW at the end of 2023).
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What are the priority uses for carbon-free hydrogen?
Although the production of carbon-free hydrogen is on the rise, volumes are still very limited. This raises the question of priority uses, given that hydrogen can be used as a fuel in industry, in road transport or as a by-product in sea and air transport (referred to here as sustainable aviation fuel, or SAF).
However, two priority targets seem to be emerging, at least in the short term:
- Replacing the carbonated hydrogen currently used in certain industrial production processes (ammonia production for fertilizers, refining of petroleum products, etc.) with decarbonated hydrogen.
- Replacing fossil fuels used in industry with decarbonated hydrogen, particularly for industrial processes for which electricity – including decarbonated electricity – is not an eligible energy carrier.
