Compressed hydrogen is used primarily in oil refining, ammonia production, fuel cell vehicles, and increasingly as a way to store renewable energy. Global demand reached almost 100 million tonnes in 2024, with the vast majority going to traditional industrial processes like refining and chemical manufacturing. Newer applications in transportation and energy storage are growing but still account for less than 1% of total consumption.
Oil Refining and Chemical Manufacturing
The largest consumers of compressed hydrogen are oil refineries and chemical plants. Refineries use hydrogen to remove sulfur from crude oil and to break heavy hydrocarbons into lighter, more valuable fuels like gasoline and diesel. This process, called hydrocracking, requires large volumes of hydrogen gas delivered at high pressure.
The second major industrial use is ammonia production through the Haber-Bosch process, which combines hydrogen gas with nitrogen from the air under extreme temperatures and pressures. Ammonia is the foundation of nearly all synthetic fertilizers, making hydrogen indirectly responsible for feeding a significant portion of the world’s population. These two sectors alone, refining and ammonia, have driven hydrogen demand for decades and remain the core of the market today.
Fuel Cell Vehicles
Compressed hydrogen powers fuel cell electric vehicles, which convert hydrogen gas into electricity onboard to drive an electric motor. The only byproduct is water vapor. Most hydrogen vehicles on the road today store their fuel in fiber-composite pressure vessels at 350 bar (about 5,000 psi), while some newer passenger cars use 700 bar tanks (roughly 10,000 psi) to pack more fuel into a smaller space and extend driving range.
These tanks are typically Type IV vessels: a high-density polyethylene liner wrapped in layers of carbon fiber and resin. The carbon fiber shell is what allows the tank to safely contain hydrogen at such extreme pressures. Refueling a 700 bar system actually requires overpressures up to 880 bar at the station to push gas into the tank quickly, which is why hydrogen refueling infrastructure is expensive and complex to build.
Heavy-duty applications like buses and trucks generally use the lower 350 bar standard, which is simpler and cheaper to implement. These vehicles have more physical space for larger tanks, so the lower energy density at 350 bar is less of a constraint than it would be in a compact car.
Renewable Energy Storage
One of the fastest-growing roles for compressed hydrogen is storing surplus electricity from wind and solar farms. When renewable generation exceeds demand, the excess electricity can power electrolyzers that split water into hydrogen and oxygen. The hydrogen is then compressed and stored until it’s needed, at which point it can be fed back through a fuel cell or turbine to generate electricity again.
The catch is efficiency. Of the 120 megajoules of energy contained in one kilogram of hydrogen, roughly 40 megajoules are lost during electrolysis and another 10 to 15 megajoules during compression. That means more than 40 to 50% of the original renewable energy is consumed before the hydrogen is ever used. Compression alone eats about 10% of hydrogen’s energy content at the 350 bar pressures needed for practical storage. Using more compression stages can reduce this penalty: a five-stage system can compress hydrogen to 1,000 bar while consuming only about 5% of its energy value.
Despite these losses, compressed hydrogen storage makes sense in situations where flexibility matters more than round-trip efficiency. Batteries are better for short-duration storage (a few hours), but hydrogen can be stored for days, weeks, or even seasonally, making it useful for balancing grids that depend heavily on variable renewables.
Maritime and Aviation
Compressed and liquid hydrogen are both being tested for zero-emission ships and aircraft. The Sea Change, the world’s first commercial hydrogen fuel cell ferry, represents one of the most visible maritime projects. Sandia National Laboratories has been studying the safety of high-pressure hydrogen storage systems on vessels, using computational models to understand how hydrogen behaves if released from tanks in enclosed spaces on ships.
In aviation, hydrogen’s appeal comes from its high energy per kilogram, roughly three times that of jet fuel. Fuel cell hybrid electric propulsion systems are the leading concept for smaller aircraft, where compressed or liquid hydrogen powers fuel cells that drive electric motors. Larger aircraft would likely need liquid hydrogen for its greater density, but compressed gas remains relevant for shorter-range planes and auxiliary power units that handle onboard electrical systems.
Backup Power and Portable Systems
Small compressed hydrogen cylinders paired with fuel cells serve as backup power for telecommunications towers, data centers, and remote industrial equipment. Communication networks need high reliability during outages lasting anywhere from several hours to several days. Traditional backup systems use lead-acid batteries for the first hour or two, then switch to diesel generators for longer outages. Hydrogen fuel cells can cover both timeframes in a single system, with power output ranging from 250 watts to 15 kilowatts depending on the installation.
This application is especially practical in remote locations far from the central power grid, such as facilities in the Far North or isolated coastal areas, where diesel fuel delivery is expensive and unreliable. Hydrogen fuel cells run silently, produce no local emissions, and require less maintenance than combustion generators.
Pipeline Blending With Natural Gas
Another emerging use involves blending compressed hydrogen into existing natural gas pipelines. The idea is to reduce the carbon intensity of natural gas by mixing in a percentage of hydrogen, which burns cleanly. The U.S. Department of Energy’s HyBlend initiative is studying how much hydrogen existing pipelines can safely handle, since the answer depends on the age, material, and condition of each pipeline segment, along with the equipment and appliances connected downstream. There is no single universal blending limit. Each pipeline system needs individual assessment to determine how much hydrogen its materials and joints can tolerate without embrittlement or leaks.