Integrated Techno-Economic Assessment of Large-Scale Green Hydrogen Production

Green hydrogen production via electrolysis from renewables is a promising method to achieve deep integration of renewable energy sources (RES) and boost decarbonisation of the whole energy system. Current studies mainly focus on low penetration levels, where both RES and electrolysers are treated as price-taker in the market. Here we develop an integrated hydrogen-electricity market simulation and investment tool, based on a mixed integer linear programming unit commitment with flexible hydrogen demand, with the aim of studying the techno-economic performance of a system with large-scale adoption of RES and electrolysis. We show how in a RES-dominated electricity market the marginal price could be set by the willingness-to-pay (WTP) price and installed capacity of electrolysers. The payback time or RES and electrolysers varies significantly for different resource portfolios and WTP prices of electrolysers. The results demonstrate how win-win RES and electrolyser economic equilibria can be achieved to produce large volumes of green hydrogen in low-carbon power systems.