Platinum Group Metals in the Hydrogen Economy: Investment Thesis and Price Implications
Platinum group metals — particularly platinum itself and iridium — are at the centre of hydrogen fuel cell technology. As hydrogen gains traction as a clean energy carrier, understanding PGM demand from the hydrogen sector is becoming increasingly important for metals investors.
The hydrogen economy represents one of the most significant potential new demand drivers for platinum group metals in decades. Hydrogen fuel cells — which generate electricity through the electrochemical reaction of hydrogen and oxygen, producing only water as a byproduct — use platinum as a catalyst at the heart of the proton exchange membrane (PEM) technology that dominates commercial fuel cell applications.\n\nThe scale of potential demand is significant. A typical passenger vehicle fuel cell stack uses 20-50 grams of platinum. Commercial vehicle fuel cell stacks use 50-120 grams. Electrolysers — devices that use electricity to produce hydrogen by splitting water — use platinum as a catalyst and iridium as an oxygen evolution catalyst, with typical commercial-scale electrolysers requiring tens of kilograms of iridium.\n\nHYDROGEN MARKET DEVELOPMENTS\nGovernment commitments to hydrogen are expanding rapidly. The EU's REPowerEU plan targets 10 million tonnes of domestically produced renewable hydrogen by 2030. The US Inflation Reduction Act provides $3 per kilogram production tax credit for clean hydrogen. Japan, South Korea, and Australia all have significant hydrogen strategies with material budget commitments.\n\nIMPLICATIONS FOR PLATINUM DEMAND\nThe World Platinum Investment Council (WPIC) projects hydrogen-related platinum demand growing from approximately 50,000 ounces in 2023 to over 800,000 ounces by 2030 and potentially 3-4 million ounces by 2035 — potentially doubling or tripling total platinum demand from current levels.\n\nThe uncertainty band around these projections is large. Hydrogen technology deployment timelines have historically been slower than initial forecasts. Cost reduction trajectories for electrolysers and fuel cells will strongly influence deployment speed. And the amount of platinum used per unit is expected to decline as catalyst technology improves.\n\nAUREXHQ VIEW: Platinum is the PGM with the most compelling long-term investment case, combining automotive transition dynamics (gradually replacing palladium in gasoline converters) with the hydrogen economy upside. Current prices below $1,000 per ounce represent attractive long-term value for patient investors.
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