This analysis conveniently ignores the power cost challenge, just as DoE document did.
Access to power transmission networks and assets results in costs which are real and unavoidable and represent a ~USD 10-15/MWh stack component of the actual cost of power feeding into any load met by the system, including hypothetical hydrogen projects.
This means that when you just assume "low prices of renewable" you must include that cost element in your analysis.
On top of that, you have the challenge of intermittency of supply very inflexible and costly downstream elements.
Even if things could go as cheap and as quickly as you unrealistically assume, you still need to find a cheap enough way to firm up power to an unavoidable level of uninterruptible demand across electrolysis, balance of plant and eventual liquefaction or compression of hydrogen, or synthesis of it into ammonia.
If and when you do your maths, down to the hourly and day to day picture of what you are talking about, you will appreciate that USD2/kgH2 electrolytic hydrogen is not likely to happen in the next 10-15 years, if ever at all.
You are completely right that the analysis about the cost and price of renewable electricity is key here. As I’m not an expert in renewable energy generation, I did not focus on it.
Regarding your last comment about electrolytic hydrogen in 10-15 years, I think we can start producing already this decade a lot of hydrogen in many regions in the world. Figure 2 shows LCOH versus Electricity price and we can see how LCOH below 3 €/kg which in some business cases and regions could be a good value to start with.
We need to realise that these developments are key for having more cost-competitive electrolyser supply value chains.
This analysis conveniently ignores the power cost challenge, just as DoE document did.
Access to power transmission networks and assets results in costs which are real and unavoidable and represent a ~USD 10-15/MWh stack component of the actual cost of power feeding into any load met by the system, including hypothetical hydrogen projects.
This means that when you just assume "low prices of renewable" you must include that cost element in your analysis.
On top of that, you have the challenge of intermittency of supply very inflexible and costly downstream elements.
Even if things could go as cheap and as quickly as you unrealistically assume, you still need to find a cheap enough way to firm up power to an unavoidable level of uninterruptible demand across electrolysis, balance of plant and eventual liquefaction or compression of hydrogen, or synthesis of it into ammonia.
If and when you do your maths, down to the hourly and day to day picture of what you are talking about, you will appreciate that USD2/kgH2 electrolytic hydrogen is not likely to happen in the next 10-15 years, if ever at all.
Thank you very much for your comment G.L.
You are completely right that the analysis about the cost and price of renewable electricity is key here. As I’m not an expert in renewable energy generation, I did not focus on it.
Regarding your last comment about electrolytic hydrogen in 10-15 years, I think we can start producing already this decade a lot of hydrogen in many regions in the world. Figure 2 shows LCOH versus Electricity price and we can see how LCOH below 3 €/kg which in some business cases and regions could be a good value to start with.
We need to realise that these developments are key for having more cost-competitive electrolyser supply value chains.