Public policies to foster green hydrogen seasonal storage: Portuguese study case model until 2040

Abstract

Portugal made a climate commitment when it ratified the Paris Climate Agreement in 2015. As a result, Portugal, along with other EU members, has created a national roadmap for the deployment of hydrogen as a crucial component of Portugal's energy transition towards carbon neutrality, creating synergies between the electric and gas systems.The increased variability of generation from variable renewable power sources will create challenges regarding the security of supply, requiring investment in storage solutions to minimize renewable energy curtailment and to provide dispatchability to the electric power system. Hydrogen can be a renewable energy carrier capable of ensuring not only the desired transformation of the infrastructures of the gas system but also an integrator of the Electric System, such as in Power-to-Power (P2P) systems. Hydrogen can be produced with a surplus of renewable electricity from wind and solar, allowing a long-term energy seasonal storage strategy, namely by using underground salt caverns, to be subsequently transformed into electricity when demand cannot be supplied due to a shortage of renewable generation from solar or wind.P2P investments are capital intensive and require the development of transitional regulation mechanisms to both create opportunities to market agents while fostering the energy surplus valuation and decreasing the energy dependency. In order to maintain the electric system's security of supply, the suggested methodology innovatively manages the importance of seasonal storage of renewable energy surplus using hydrogen in power systems. It suggests a novel set of regulatory strategies to foster the creation of a P2P solution that maintains generation adequacy while assisting in decarbonising the electric power industry. Such methodology combines long-term adequacy assessment with regulatory framework evaluation to evaluate the cost of the proposed solutions to the energy system.A case study based on the Portuguese power system outlook between 2030 and 2040 demonstrates that the considerable renewable energy surplus can be stored as hydrogen and converted back into electricity to assure adequate security of supply levels throughout the year with economic feasibility under distinct public policy models.