{"id":332394,"date":"2024-06-11T16:51:38","date_gmt":"2024-06-11T14:51:38","guid":{"rendered":"https:\/\/climatescience.press\/?p=332394"},"modified":"2024-06-11T16:51:42","modified_gmt":"2024-06-11T14:51:42","slug":"updated-hydrogen-costings","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=332394","title":{"rendered":"Updated Hydrogen Costings"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

From NOT A LOT OF PEOPLE KNOW THAT <\/a><\/p>\n\n\n\n

By Paul Homewood<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

The cost of producing and installing electrolysers for green hydrogen production in China, the US and Europe \u2014 three of the world\u2019s biggest markets \u2014 has risen by more than 50% compared to last year, research house BloombergNEF (BNEF) has found, rather than the gradual reduction its analysis had previously indicated.<\/em><\/p>\n\n\n\n

The main culprit for Western manufacturers has been inflation, which has pushed up the costs of materials, utilities (such as water and electricity) and labour in the US and Europe, said BNEF in its new report, <\/em>Electrolyser Price Survey 2024<\/em><\/a>.<\/em><\/p>\n\n\n\n

As a result, average system-level cost (including both stack and balance of plant) is now at a mid-range of $600\/kW for an electrolyser made in China, while machines made in Europe or the US are around $2,500\/kW.<\/em><\/p>\n\n\n\n

This makes Western electrolysers four times more expensive than Chinese equivalents, a gap that has not closed at all since the previous report, BNEF noted.<\/em><\/p>\n\n\n\n

The research house had previously predicted that costs would gradually decline over three years from 2022, as more large-scale projects approached completion.<\/em><\/p>\n\n\n\n

https:\/\/www.hydrogeninsight.com\/electrolysers\/cost-of-electrolysers-for-green-hydrogen-production-is-rising-instead-of-falling-bnef\/2-1-1607220<\/a><\/p>\n\n\n\n

<\/p>\n\n\n\n

Green hydrogen, once touted as a saviour of Net Zero, seems to have gone off the radar recently. A few years ago there were wild, unsubstantiated predictions that hydrogen would become so cheap and easy to produce that we could all give up fossil fuels.<\/p>\n\n\n\n

Instead, as Bloomberg now report, costs of electrolysers are going up, not down. Moreover the real cost of wind power is also much higher than previously thought, so green hydrogen will be much more expensive as a result.<\/p>\n\n\n\n

So let\u2019s take a closer look at these costs.<\/p>\n\n\n\n

Back in 2018, BEIS published this report:<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

https:\/\/www.gov.uk\/government\/publications\/hydrogen-supply-chain-evidence-base.<\/a><\/p>\n\n\n\n

I analysed the report here<\/a>.<\/p>\n\n\n\n

It featured this table:<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

I gather that PEM technology (Proton Exchange Membrane) is the most likely one to be rolled out. The Base Cost in 2025 was predicted at \u00a3500\/kW.<\/p>\n\n\n\n

A study<\/a> last October suggested a mid-range cost of Eu727, equivalent to about \u00a3630\/kW. Bloomberg reckon $600, but this is based on ultra-low Chinese manufacturing costs, almost certainly highly subsidised. Significantly they estimate that European made electrolysers are four times the price.<\/p>\n\n\n\n

We can reasonably work on a cost therefore of around \u00a3600.<\/p>\n\n\n\n

The BEIS study assumed 52.0 kWh\/kg H2 in 2025. The energy density of hydrogen<\/a> , however, is 33.3 Kwh per kg, which means that the electrolysis process only works at 64% efficiency. In other words, 36% of the energy input is wasted.<\/p>\n\n\n\n

Previous cost estimates have been based on rock bottom costs of renewable energy, particularly offshore wind, which would have to supply most of the power needed for electrolysis in the UK. As we now know, these costs were never realistic. The Administrative Strike Price of offshore wind for AR6 is now \u00a3100\/MWh at 2023 prices. Allowing for energy efficiency of only 64%, the energy input cost of hydrogen is therefore  \u00a3156\/MWh.<\/p>\n\n\n\n

On top of that, are operational costs. BEIS reckoned \u00a321\/MWh in 2018, which is probably in the range of \u00a330 now.<\/p>\n\n\n\n

Already, therefore, we are up to \u00a3186\/MWh, before adding CAPEX. BEIS estimated this at about \u00a330\/MWh in 2018. But this assumed loan interest rates of 5%. Given interest rate rises since then and general inflation, a CAPEX of \u00a360\/MWh is not unreasonable.<\/p>\n\n\n\n

This therefore gives us a total cost of \u00a3246\/MWh.<\/p>\n\n\n\n

<\/p>\n\n\n\n

Wholesale prices<\/a> of natural gas have been ranging between about 55 and 85p\/therm this year. The conversion rate is 29.3 kWh\/therm, giving a cost of \u00a323.90\/MWh, based on a mid-point of 70p.<\/p>\n\n\n\n

Anybody still think hydrogen is a good idea?<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The cost of producing and installing electrolysers for green hydrogen production in China, the US and Europe \u2014 three of the world\u2019s biggest markets \u2014 has risen by more than 50% compared to last year, research house BloombergNEF (BNEF) has found, rather than the gradual reduction its analysis had previously indicated.<\/p>\n","protected":false},"author":121246920,"featured_media":332401,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","_crdt_document":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[691819849,691818154,691827678,691818852],"class_list":{"0":"post-332394","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"category-uncategorized","8":"tag-green-hydrogen","9":"tag-net-zero","10":"tag-the-costs","11":"tag-wind-power","13":"fallback-thumbnail"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/06\/0Green-hydrogen-scaled-1.webp?fit=2560%2C1497&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/paxLW1-1otc","jetpack-related-posts":[{"id":303898,"url":"https:\/\/climatescience.press\/?p=303898","url_meta":{"origin":332394,"position":0},"title":"Hydrogen hopefuls stare into valley of death as electrolyser bubble pops","author":"uwe.roland.gross","date":"23\/02\/2024","format":false,"excerpt":"Last week, two of the most notable electrolyser technology developers \u2013 Plug Power and Bloom Energy Corp \u2013 revealed the depth of their problems as they try to achieve massive scale while improving and reducing the cost of the technologies they are developing.","rel":"","context":"In \"Ballard Power Systems\"","block_context":{"text":"Ballard Power Systems","link":"https:\/\/climatescience.press\/?tag=ballard-power-systems"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/02\/0Hydrogen_electrolyser_Adobestock2.png?fit=1200%2C660&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/02\/0Hydrogen_electrolyser_Adobestock2.png?fit=1200%2C660&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/02\/0Hydrogen_electrolyser_Adobestock2.png?fit=1200%2C660&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/02\/0Hydrogen_electrolyser_Adobestock2.png?fit=1200%2C660&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/02\/0Hydrogen_electrolyser_Adobestock2.png?fit=1200%2C660&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":288693,"url":"https:\/\/climatescience.press\/?p=288693","url_meta":{"origin":332394,"position":1},"title":"Germany: Green hydrogen project in Heide stopped prematurely","author":"uwe.roland.gross","date":"26\/11\/2023","format":false,"excerpt":"The Heide oil refinery has decided to use green hydrogen. However, the \"West Coast 100\" electrolysis plant project was prematurely terminated three years after the project began. Raffinerie Heide, \u00d8rsted Germany and Hynamics Germany have announced that they will not build an electrolyser. More than three years ago, they joined\u2026","rel":"","context":"In \"\u00d8rsted\"","block_context":{"text":"\u00d8rsted","link":"https:\/\/climatescience.press\/?tag=orsted-2"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/00csm_ueber-uns-headerbild_Raffinerie_Heide_563b59d6e2-1-1250x625-1.jpg?fit=1200%2C600&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/00csm_ueber-uns-headerbild_Raffinerie_Heide_563b59d6e2-1-1250x625-1.jpg?fit=1200%2C600&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/00csm_ueber-uns-headerbild_Raffinerie_Heide_563b59d6e2-1-1250x625-1.jpg?fit=1200%2C600&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/00csm_ueber-uns-headerbild_Raffinerie_Heide_563b59d6e2-1-1250x625-1.jpg?fit=1200%2C600&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/11\/00csm_ueber-uns-headerbild_Raffinerie_Heide_563b59d6e2-1-1250x625-1.jpg?fit=1200%2C600&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":337020,"url":"https:\/\/climatescience.press\/?p=337020","url_meta":{"origin":332394,"position":2},"title":"How the West\u2019s \u2018absurd\u2019 bet on hydrogen imploded","author":"uwe.roland.gross","date":"20\/07\/2024","format":false,"excerpt":"Hopes of a seamless transition to the clean fuel are crashing into economic reality","rel":"","context":"In \"clean energy\"","block_context":{"text":"clean energy","link":"https:\/\/climatescience.press\/?tag=clean-energy"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0Hydrogen-main-image-iStock-1277374491-1920x1280-1.jpg?fit=1200%2C800&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0Hydrogen-main-image-iStock-1277374491-1920x1280-1.jpg?fit=1200%2C800&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0Hydrogen-main-image-iStock-1277374491-1920x1280-1.jpg?fit=1200%2C800&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0Hydrogen-main-image-iStock-1277374491-1920x1280-1.jpg?fit=1200%2C800&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0Hydrogen-main-image-iStock-1277374491-1920x1280-1.jpg?fit=1200%2C800&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":296700,"url":"https:\/\/climatescience.press\/?p=296700","url_meta":{"origin":332394,"position":3},"title":"Another \u00a32 Billion Handed Out To Subsidise\u00a0Hydrogen","author":"uwe.roland.gross","date":"18\/01\/2024","format":false,"excerpt":"How the DESNZ can claim it represents value for money is a mystery! And to pretend they are nascent technologies is also untrue, because electrolysis is a well established process.","rel":"","context":"In \"Net zero\"","block_context":{"text":"Net zero","link":"https:\/\/climatescience.press\/?tag=net-zero"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/01\/can-doe-make-clean-hydrogen-a-thing-subsidies-for-hydrogen-v0-l5p1_OHnlQipN9L14CyfWygsD6GhsldLE0637B-XLco.webp?fit=1200%2C792&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/01\/can-doe-make-clean-hydrogen-a-thing-subsidies-for-hydrogen-v0-l5p1_OHnlQipN9L14CyfWygsD6GhsldLE0637B-XLco.webp?fit=1200%2C792&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/01\/can-doe-make-clean-hydrogen-a-thing-subsidies-for-hydrogen-v0-l5p1_OHnlQipN9L14CyfWygsD6GhsldLE0637B-XLco.webp?fit=1200%2C792&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/01\/can-doe-make-clean-hydrogen-a-thing-subsidies-for-hydrogen-v0-l5p1_OHnlQipN9L14CyfWygsD6GhsldLE0637B-XLco.webp?fit=1200%2C792&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/01\/can-doe-make-clean-hydrogen-a-thing-subsidies-for-hydrogen-v0-l5p1_OHnlQipN9L14CyfWygsD6GhsldLE0637B-XLco.webp?fit=1200%2C792&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":232734,"url":"https:\/\/climatescience.press\/?p=232734","url_meta":{"origin":332394,"position":4},"title":"Energy Storage Report: Hydrogen as An Alternative to Batteries","author":"uwe.roland.gross","date":"06\/12\/2022","format":false,"excerpt":"It\u2019s no wonder that green hydrogen is all\u00a0talk.","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/12\/image-139.png?fit=1024%2C576&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/12\/image-139.png?fit=1024%2C576&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/12\/image-139.png?fit=1024%2C576&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2022\/12\/image-139.png?fit=1024%2C576&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":337359,"url":"https:\/\/climatescience.press\/?p=337359","url_meta":{"origin":332394,"position":5},"title":"The Energy Transition Ain\u2019t Happening: Hydrogen in Australia","author":"uwe.roland.gross","date":"23\/07\/2024","format":false,"excerpt":"These days, there is lots and lots of news about how the supposed \u201cenergy transition\u201d is not happening. There\u2019s so much news on this subject that I could devote this entire blog to that subject alone and have plenty to occupy my time. Expect multiple posts about this topic over\u2026","rel":"","context":"In \"Australia\"","block_context":{"text":"Australia","link":"https:\/\/climatescience.press\/?tag=australia"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0-Green-hydrogen.jpeg?fit=1200%2C702&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0-Green-hydrogen.jpeg?fit=1200%2C702&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0-Green-hydrogen.jpeg?fit=1200%2C702&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0-Green-hydrogen.jpeg?fit=1200%2C702&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2024\/07\/0-Green-hydrogen.jpeg?fit=1200%2C702&ssl=1&resize=1050%2C600 3x"},"classes":[]}],"_links":{"self":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/332394","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/users\/121246920"}],"replies":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=332394"}],"version-history":[{"count":5,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/332394\/revisions"}],"predecessor-version":[{"id":332403,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/posts\/332394\/revisions\/332403"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=\/wp\/v2\/media\/332401"}],"wp:attachment":[{"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=332394"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=332394"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/climatescience.press\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=332394"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}