PV–battery-hydrogen plant: Cutting green hydrogen costs through multi-market positioning

Abstract

Integration of renewable energy sources as one of the pillars of the power system decarbonization efforts is making a significant progress. However, large shares of renewables require additional flexibility to keep the system stable. Battery storage was identified as one of the solutions to restore the grid balance in short timeframes, from day-ahead to real time. Currently, the research community is trying to find an adequate technology for longer duration energy storage. Hydrogen, as an energy carrier, appears as a good choice for such task. Apart from hydrogen energy storage potential, it can also be used to implement power-to-gas technology able to mitigate renewable energy curtailment through the process of electrolysis. The produced hydrogen gas can be either used to partially decarbonize the natural gas grids or simply sold as hydrogen fuel.The main novelty of this paper is the creation of a mathematical model of a renewable power plant coupled with a battery storage and a hydrogen facility for trading in three day-ahead energy markets, i.e. electricity, natural gas and hydrogen, plus in the power balancing market subject to the imbalance settlement mechanism. This approach enables a long-term profitability analysis of different renewable, battery and hydrogen architectures (hydrogen energy storage, power-to-gas and their combination) and their participation in different markets.The results indicate that the battery energy storage provides balancing services to the transmission system operator almost exclusively, while it never provides balancing for its own imbalance needs, since this option is less financially attractive. The electrolyzer and the fuel cell operate at least one third of the year, depending on the observed case, and often provide a reserve. When considering the hydrogen market, the electrolyzer operates almost the entire year due to lucrative hydrogen prices. Both the battery storage and the hydrogen tank perform arbitrage in the day-ahead market, where the battery optimizes its operation on an hourly basis (short-term) and the hydrogen tank on a daily basis (medium- to long-term).