Techno-economic Analysis on Renewable Energy via Hydrogen from Macro and Micro Scope Views

Abstract

Since 2012, the Japanese government has widely adopted variable renewable energy (VRE), especially photovoltaics (PVs), as a result of the Feed-In-Tariff (FIT) system. However, energy storage technologies must reduce their burden on the electric power grid to make best-use of intermittent renewable power sources. Power-to-Gas (P2G), which converts surplus power from VRE to hydrogen, is a promising candidate for large-scale and long-term energy storage technology. We utilized analytical models based on actual data from micro-side research and simulation results from macro-side one. We assume that the system either uses a combination of electrolysis cells (ECs) and hydrogen fuel cells (FCs), or ECs and hydrogen co-firing using surplus power from PVs, and will be introduced around 2030 on both sides of the micro (building) and macro (power district area). On the macro side, we investigated power mix by a power planning model. We found that hydrogen fuel cells have great potential to increase local utilization of surplus power. On the micro side, we applied a cost evaluation model consisting of ECs, FCs, hydrogen storage, and PVs, with surplus power selling price as a given parameter. The model shows that total costs are lower when hydrogen is used. Additionally, when electricity selling price is volatile depending on power demand, the model predicts FC capacity expansion. We conclude that P2G has both cost competitiveness and environmental benefit, and that the combination of solar power and hydrogen is a promising technology which expands PV capacity beyond limits without combination.