(279c) Strategic Planning of Hydrogen Supply Chains for Meeting Local, Regional, and Global Demands

Decarbonization and reduction of greenhouse gas (GHG) emissions will most likely require significant changes in the energy infrastructure [1]. Hydrogen (H₂) is a versatile fuel, feedstock, and energy carrier that shows a great potential to decentralize our decarbonization efforts towards achieving an equitable low-carbon development [2]. H₂ as a fuel is environmentally benign and being a high-energy dense carrier, it makes energy transportation more economical. Different production routes have been developed for H₂ manufacturing and these have been named with different color names (e.g., blue, green) based on their emissions. Of all the different production routes, green hydrogen is one of the most promising due to its complete dependence on solar and wind power thus having net zero emissions. Availability of renewable energy in some regions makes locally produced green hydrogen very attractive. The 2021 Bipartisan Infrastructure Law (BIL) calls for significant investments in American Infrastructure, with over 8 billion dollars in regional clean hydrogen hubs, demonstrating a national commitment and vision towards transitioning to a sustainable hydrogen-based economy (e.g., H2@Scale or Energy Earthshot focusing Hydrogen) [3,4]. The bill also specifically calls for investments in regional hydrogen infrastructure while actively engaging nearby communities. However, it is not clearly understood what fundamental changes in the configurations of future hydrogen infrastructure would lead to a sustainable and equitable carbon-neutral economy. While decentralized manufacturing enables the use of local resources to meet local demands, several barriers need to be overcome before a fully sustainable regional hydrogen economy can be realized. Several barriers exist, including high cost, lack of system-wide integration, safety concerns, regulatory barriers, negative public perception, and gaps in skilled workforce training to participate in a distributed hydrogen economy.

In this study, we present a strategic hierarchical clustering approach for the hydrogen supply chain to satisfy local, regional, and global hydrogen demand. For each location on the geo-spatial grid, we develop a mixed-integer non-linear programming (MINLP) model for the simultaneous design and scheduling of H₂. Essentially, the model optimizes the cost and reports the optimal size of the solar farm, wind farm, electrolyzer, H₂ storage capacity and the cost of H₂. High-fidelity models are developed for the electrolyzer and then reduced order models are implemented in the optimization model. With such a high spatial resolution, data procurement, curation, and analysis is a major challenge for such a large-scale problem [5]. We focus on Texas as a case study and consider the hydrogen production potential from wind and solar resources at the county level, the serviceable consumption potential for hydrogen in the industrial and transportation sectors, and storage, which leads to county-wise local demand. To determine the ideal location for the hydrogen hub/hubs in Texas, we consider the hydrogen production, transportation, and storage cost. We formulate the supply chain element cost function for transportation and storage, including the transformation cost, and analyze centralized vs. distributed hydrogen supply chain. We then conduct clustering to determine the optimal hydrogen supply chain to satisfy the state's country-wise local hydrogen demand economically. Finally, we extend the same hierarchical clustering approach for national, regional, and global levels. This method can assist in locating the optimal location for a hydrogen production facility considering the variable local energy sources and supply chain costs. It can be extended to all states in the United States and other countries with similar energy resources, providing strategic supply chain development and policy reformation suggestions.

References

1. Hasan MMF, Zantye MS, Kazi M-K: Challenges and opportunities in carbon capture, utilization and storage: A process systems engineering perspective. Computers & Chemical Engineering 2022, 166:107925.
2. Kazi M-K, Eljack F, El-Halwagi MM, Haouari M: Green hydrogen for industrial sector decarbonization: Costs and impacts on hydrogen economy in qatar. Computers & Chemical Engineering 2020:107144.
3. US DoE: Hydrogen Strategy: Enabling a Low-Carbon Economy. Office of Fossil Energy 2020, https://www.energy.gov/sites/prod/files/2020/07/f76/USDOE_FE_Hydrogen_Strategy_July2020.pdf.
4. The White House: A Guidebook to the Bipartisan Infrastructure Law for State, Local, Tribal, and Territorial Governments, and other partners. The White House 2022, https://www.whitehouse.gov/wp-content/uploads/2022/01/BUILDING-A-BETTER-AMERICA_FINAL.pdf
5. Arora A, Zantye MS, Hasan MMF: Sustainable hydrogen manufacturing via renewable-integrated intensified process for refueling stations. Applied Energy 2022, 311:118667.