TECHNO-ECONOMIC ANALYSIS OF THE HYDROGEN SUPPLY CHAIN : A CASE STUDY OF THE SWEDISH INDUSTRY

Abstract: The European Energy system is currently transitioning towards a reduced use of fossil fuels and increasing use of renewable energy. Hydrogen as energy carrier for renewable electricity has a potential to play a significant role in this transition. It can be stored and transported in its gaseous or liquid state, and utilized in industries that require highprocess heat, which makes them difficult to decarbonize. Further, hydrogen storage canbe employed to store over‐produced renewable electricity in large scale and for long periods of time. This research aims to develop a methodology to conduct a layout and dispatch optimization for utilizing locally produced hydrogen. The objective is to find the least cost supply pathway for a defined demand. In this case study, hydrogen is produced by water electrolysis supplied by the local electricity grid and renewable electricity, such as solar PV, onshore and offshore wind turbines. The scope is limited to gaseous hydrogen thereby the distribution is also limited to pipelines or road trucks. The optimized supplychain comprises four main stages: I) electricity generation and storage; II) hydrogen production; III) hydrogen compression and storage; IV) hydrogen transportation to the end consumer. It results in the system's optimum hourly dispatch schedule and a proposed least‐cost layout. The developed methodology is finally applied to an industrial case study in Sweden, for which scenarios with varying boundary conditions are tested. The least cost supply chain for the case study resulted in a system solely supplied with electricity purchased from the grid, a PEM electrolyzer, a hydrogen storage in a Lined Rock Cavern, and hydrogen transport via pipeline. The lowest Levelized Cost of Hydrogen from electricity purchase until delivery is 5.17 EUR/kgH2. The study concludes that there is no one optimum solution for all and the constraints of the optimization problem need to be evaluated case by case.The study further highlights that intermittency and peaks of both electricity availability and hydrogen demand can lead to an increase in system cost owing to the oversizing and storage needs.