Abstract
A 250kW hydrogen electrolysis facility was recently installed at the Natural Energy Laboratory of Hawaii Authority's (NELHA's) campus. This facility that will begin operation in 2020 to produce hydrogen for fuel cell buses on the island to demonstrate of the application of hydrogen to decarbonize transportation. Given the size of the electrolysis station, it has the potential to significantly increase electricity costs for the campus, which is subject to energy and peak demand charges from the local utility.In this paper, we analyze the cost of hydrogen production at NELHA given the rate structure options available from the utility. Production costs are estimated using optimal versus constant scheduling of the facility to meet the buses’ demand. A model of the electrolysis station is used to capture changes in production efficiency over the power range in the optimization routine. The effects of combining the station and campus load versus standalone operation and increasing solar generation are also explored. The analyses surrounding this scenario show the importance of multiple factors on the potential profitability of hydrogen production in behind-the-meter applications and show trends that could have implications for other similar installations.
Highlights
As electric grids begin to incorporate more intermittent renewable resources of energy such as solar and wind, the value of technologies such as batteries that can balance supply and demand will increase significantly
The analysis shows that approximately doubling the current solar generation from 170kW to 350kW would reduce the cost of production by 26-30% when the system is paired with the Natural Energy Laboratory of Hawaii Authority (NELHA) campus load
Energy storage and large-scale flexible loads can both have a significant effect on the integration of renewable sources of power
Summary
As electric grids begin to incorporate more intermittent renewable resources of energy such as solar and wind, the value of technologies such as batteries that can balance supply and demand will increase significantly. Grid-scale energy storage has the potential to provide this capability, and a number of studies have shown the technical and economic benefits of energy storage systems in this capacity.[1–4]. Largescale loads that can ramp up and down quickly to match the generation needs, such as hydrogen production facilities, could provide similar functionality while producing additional valuable commodities.[5–7]. This type of capability will become increasingly important as regions around the world become more reliant on renewable and intermittent forms of power production. Studies projecting future grids with high levels of intermittent resources show that hydrogen production facilities using water electrolysis could be a good flexible load for grid operations because electrolyzers can be controlled to vary their load quickly at potentially large scales.[8–11] Though hydrogen production from fossil fuel reformation is typically the cheapest mode of production currently,[12] electrolytic hydrogen production could become a cost-effective option if there is an abundance of excess renewable generation that would otherwise be curtailed
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