title: Production of Hydrogen by Renewable Means for Export from Australia
Creators: name: Rezaei, Mostafa
Publisher: name: Griffith University
Year: 2024
Subjects: subject: renewable hydrogen production
subject: hydrogen export
subject: dynamic hydrogen production

description: This project's main objective was to investigates the economics of renewable hydrogen production in Australia for export. Given the inherent nature of economic analysis, which relies on factors inevitably subject to some degree of uncertainty, a sensitivity analysis is crucial to ascertain the response of the levelised cost of hydrogen (LCOH) to potential changes in these factors. Influential technical factors include the renewable capacity factor, electrolyser efficiency, and electrolyser stacks' lifetime, along with financial factors such as the inflation rate and cost of financing. Subsequently, trade-offs between key cost drivers - specifically, electrolyser initial investment (CAPEX) and the cost of electricity (LCOE) - were analysed, along with the impact of incorporating environmental costs of emissions. This analysis aimed to identify scenarios where renewable-based LCOH could be cost-competitive against the dominant method of hydrogen production, namely steam methane reforming. The results clearly demonstrated the significance of careful site selection to achieve a high renewable capacity factor, which proved to be more influential than foreseeable increases in electrolyser efficiency. Additionally, green subsidies resulting from the use of renewable electricity were found to be essential in lowering the LCOH. However, other improvements, such as enhancing electrolyser efficiency, are also required for meaningful economic improvement in green hydrogen production. In practical applications, electrolysers powered by intermittent renewable resources operate with dynamically varying efficiency. Therefore, for the most accurate estimation of LCOH, it is crucial to incorporate real-world operational characteristics into the model as extensively as possible. Taking into account the experiment-based power-dependent efficiency of the electrolyser and its overload capacity, a reliable economic model was developed. This model also integrates economies of scale and a learning-curve model to address the impact of large-scale projects and factor in cost reductions through cumulative production capacity growth of emerging technologies. The model was compared to a widely applied approach wherein efficiency is assumed to be independent of input power, revealing that this constant efficiency assumption leads to overestimation of the LCOH. Utilising the developed model based on the actual power-efficiency curve, nominated hydrogen hubs across Australia were studied. In this analysis, the two dominant electrolysis technologies, proton exchange membrane (PEM) and alkaline (ALK) electrolysers, were assumed to be powered by photovoltaic (PV) arrays or wind turbines (WT). The estimations of LCOH in each location indicated that scale-up is key to reducing the LCOH by a meaningful amount. Adding dual-axis solar tracking technology to the PV plant or increasing WT hub heights would impact the LCOH, contingent on how the improved renewable capacity factor offsets the increased LCOE resulting from the higher CAPEX of PV or WT plants. Finally, the entire supply chain of green hydrogen production in Australia for export to Japan was studied. The results indicated that LNH3 and MCH would be promising carriers for export, yielding the lowest landed LCOH. LH2 yielded the highest LCOH unless boiloff gas could be managed effectively and cheaply. Increasing the production rate by tenfold very significantly lowered the landed LCOH, providing a strong incentive to scale up and optimise the entire supply chain as fast as possible. The findings of the project offer a practical roadmap for stakeholders, particularly policymakers, enabling them to formulate strategies and incentive structures that foster the implementation of large-scale renewable hydrogen initiatives. Such insights are crucial for guiding decision-making toward cost-effective and efficient renewable hydrogen solutions, thereby shaping the future landscape of the hydrogen energy sector.