Producing green hydrogen efficiently and affordably offers significant challenges for developers. One of the most critical aspects of green hydrogen production is how renewable energy sources like wind, solar and battery storage are combined to power the electrolysers. Every location has different wind and sun characteristics, and some projects goal-seek a certain percentage utilisation of green electricity on an hourly or even sub-hourly basis.
Surprisingly, the simple logic of “more is better” does not apply here. Optimising hydrogen production and CAPEX requires careful sizing of renewable energy sources and understanding their correlation through site-specific meteorology and resource data, analysed in hourly increments over several years.
The cost of electricity in green hydrogen production
Generally speaking, one-half to two-thirds of the cost of producing green hydrogen comes from the electricity required to power the electrolysers. Therefore, producing green hydrogen affordably relies heavily on minimising electricity costs. While it may seem logical to maximise renewable energy generation given the free source of fuel and green hydrogen incentives, this approach is usually financially inappropriate.
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