Grid-supported electrolytic hydrogen production: Cost and climate impact using dynamic emission factors

Hydrogen production based on a combination of intermittent renewables and grid electricity is a promising approach for reducing emissions in hard-to-decarbonise sectors at lower costs. However, for such a configuration to provide climate benefits it is crucial to ensure that the grid electricity consumed in the process is derived from low-carbon sources. This paper examined the use of hourly grid emission factors (EFs) to more accurately determine the short-term climate impact of dynamically operated electrolysers. A model of the interconnected northern European electricity system was developed and used to calculate average grid-mix and marginal EFs for the four bidding zones in Sweden. Operating a 10 MW electrolyser using a combination of onshore wind and grid electricity was found to decrease the levelised cost of hydrogen (LCOH) to 2.40-3.63 euro/kgH2 compared with 4.68 euro/kgH2 for wind-only operation. A trade-off between LCOH and short-term climate impact was revealed as specific marginal emissions could exceed 20 kgCO2eq/kgH2 at minimum LCOH. Both an emission-minimising operating strategy and an increased wind-to-electrolyser ratio was found to manage this trade-off by enabling simultaneous cost and emission reductions, lowering the marginal carbon abatement cost (CAC) from 276.8 euro/tCO2eq for wind-only operation to a minimum of 222.7 and 119.3 euro/tCO2eq respectively. Both EF and LCOH variations were also identified between the bidding zones but with no notable impact on the marginal CAC. When using average grid-mix emission factors, the climate impact was low and the CAC could be reduced to 71.3-200.0 euro/tCO2eq. In relation to proposed EU policy it was demonstrated that abiding by hourly renewable temporal matching principles could ensure low marginal emissions at current levels of fossil fuels in the electricity mix.

Automated summary

This paper examined the use of intermittent renewables and grid electricity for hydrogen production, finding that using a combination of onshore wind and grid electricity can significantly reduce the cost of hydrogen production compared to wind-only operation. It also identified a trade-off between cost and short-term climate impact, with specific marginal emissions exceeding 20 kgCO2eq/kgH2 at minimum cost.