(221b) Session Keynote: Economics of Large Scale Hydrogen Generation: Can H2 Compete with Batteries?

Interest in hydrogen, always vulnerable to the changing winds of government and industrial interest once again finds itself at a peak. Electrolysis of water, when coupled with renewable energy is generally accepted as the only carbon-free method of hydrogen production. Alkaline hydrolysis which has long been the work-horse of large-scale electrolysis is generally being replaced by PEM (polymer electrolyte membrane) due to the latter’s higher efficiency, and ability to provide higher and differential pressure. Subsequently there are more and more providers of large-scale PEM systems. Despite this there is little agreement on what the cost of that hydrogen will be. Charlie Freese, executive director- global fuel cell activities at General Motors recently gave a target of $0.57/kg.¹ though current suppliers of hydrogen (from centralized reformation) are charging $16.00/kg, using natural gas, which is currently the cheapest method to supply hydrogen.

The difficulties in generating, developing and supplying high pressure (700 bar) hydrogen coupled with rapidly decreasing battery costs has made batteries the current preferred choice for both electric vehicles and grid level storage. Can hydrogen compete? This talk will look at the underlying costs of hydrogen from electrolysis. It will also look at the opportunities and the technical challenges of lowering both capital and operating expenditures. Specifically, the role of noble metals, often the focus of PEM research funding, will show that they do not contribute significantly to the cost of electrolysis at current usage. Finally much of the assumptions of low-cost hydrogen from electrolysis is based on cheap, or even free energy from excess renewables. Taking advantage of these low-cost intermittent sources can greatly reduce the utilization of the electrolysis capital equipment however, greatly increasing capital costs.

[1] Amend, James M. “Fifty-Cent Fuel Ahead, If Stars Align” WardsAuto June 2016. http://wardsauto.com/engines/fifty-cent-fuel-ahead-if-stars-align