Most hydrogen is produced at large industrial facilities, primarily oil refineries, chemical plants, and fertilizer factories. China and the United States are the two largest producers, and the vast majority of global hydrogen still comes from fossil fuels. But the geography of hydrogen production is shifting as new renewable-powered facilities come online in wind-rich and solar-rich regions around the world.
Natural Gas Reforming Plants
In the United States, 95% of hydrogen is made by natural gas reforming in large centralized plants, according to the Department of Energy. The process pushes high-temperature steam (700°C to 1,000°C) through natural gas to strip out hydrogen molecules. These facilities are concentrated near oil refineries and petrochemical complexes, particularly along the U.S. Gulf Coast in Texas and Louisiana, where natural gas is cheap and abundant and refineries need hydrogen on-site to process crude oil into cleaner fuels.
Globally, natural gas reforming is the dominant production method in North America, Europe, and the Middle East. The hydrogen rarely travels far. Most is consumed at the same facility where it’s made, feeding directly into refining operations or ammonia synthesis for fertilizer.
Coal Gasification in China
China is the world’s largest hydrogen producer and consumer, using more than 24 million tonnes per year. It is also the only country that produces hydrogen from coal at significant scale. About two-thirds of China’s hydrogen comes from coal gasification, a process that generated roughly 360 million tonnes of CO₂ emissions in 2020 alone. China relies on coal because it has limited domestic natural gas reserves but a massive coal gasification infrastructure already in place. This makes China’s hydrogen supply chain fundamentally different from that of Western producers, and far more carbon-intensive.
Oil Refineries and Fertilizer Plants
The single largest use of hydrogen worldwide is inside the facilities that produce it. Oil refineries use hydrogen to remove sulfur from diesel and gasoline and to break heavy crude into lighter products. Ammonia plants use hydrogen as the primary ingredient in fertilizer production, combining it with nitrogen pulled from the air. In both cases, the hydrogen is typically generated on-site by reforming natural gas, naphtha, or other fossil fuels, then consumed immediately without ever being stored or transported.
This pattern holds across countries. In India, for example, hydrogen is mostly produced for in-house consumption by petroleum refining and fertilizer industries. The same is true across Europe, where hydrogen serves primarily as a chemical feedstock for plastics and fertilizers rather than as an energy carrier.
Green Hydrogen From Renewable Energy
A growing number of hydrogen production sites are powered by renewable electricity instead of fossil fuels. These facilities use electrolyzers, devices that split water into hydrogen and oxygen using an electric current. The key strategy is placing electrolyzers right next to wind farms or solar arrays, which keeps costs down and avoids transmission losses.
Studies show that the cheapest green hydrogen comes from electrolyzers co-located with onshore wind and solar installations. One notable project is the Haru Oni facility in the Magallanes region of Chile, which pairs a 1.25-megawatt electrolyzer with a 3.4-megawatt wind turbine to take advantage of the region’s exceptionally strong and consistent winds. Engineers are also exploring offshore production, integrating electrolyzers directly into offshore wind turbines so hydrogen can be piped to shore.
Green hydrogen still represents a small fraction of total production, but the geography follows the renewable resource. Wind-heavy coastlines in northern Europe, sun-drenched deserts in the Middle East and Australia, and hydropower-rich regions in Scandinavia and South America are all positioning themselves as future green hydrogen hubs.
Hydrogen as an Industrial Byproduct
Some hydrogen is never intentionally “produced” at all. It comes out as a byproduct of other chemical processes. The most significant example is the chlor-alkali process, which manufactures chlorine and sodium hydroxide (used in everything from water treatment to soap). Hydrogen gas is released as a side product during this electrolysis reaction. Historically, much of this byproduct hydrogen was simply vented or burned off. There is increasing interest in capturing it as a low-cost, low-emission hydrogen source, particularly in the EU, where it could replace fossil-fuel-derived hydrogen in heavy industry or transportation.
Top Producing Countries
China dominates global hydrogen production by a wide margin, both producing and consuming more than any other nation. The United States ranks second, accounting for about 13% of global demand. Other major producers include India, Japan, South Korea, and countries in the Middle East and Europe, though precise rankings shift depending on whether you count only dedicated hydrogen production or include hydrogen made as a chemical intermediate.
The geography of production is closely tied to each country’s energy mix. Coal-dependent economies like China rely on gasification. Gas-rich nations like the U.S., Qatar, and Russia lean on steam reforming. Countries with ambitious climate targets, such as Germany, Australia, and Chile, are investing most heavily in electrolyzer capacity tied to renewables. Over the next decade, the map of hydrogen production will look increasingly different as green hydrogen projects scale up in regions with the best wind and solar resources.