Picture this: After discussing couple of options on energy solutions, a potential customer excitedly showed me slides of a concept to turn wastewater into a power source, complete with hydrogen production and fuel cells churning out electricity for their industrial operation at a competitive cost of electricity. He was convinced, or someone convinced him, that it can happen with a low-level of effort. I told him that it was an interesting idea but did not have facts and details to give a sound opinion, and that I will get back to him. Indeed, I did not have the facts, but my two cents intuition knew that it was unrealistic. Yet I knew that I had to first address his hype on H2 to consider other realistic options. So, I went on to research and gather data on putting together an industrial scale H2 power plant.
In this post, I will share with you the high-level interesting findings on setting such a hydrogen system and whether it merits spending more than half a billion dollars on it.
The System
To high level system is depicted below. The system starts with water electrolysis to produce hydrogen, which is then converted into electricity using fuel cells as illustrated in the picture below.
Our customer’s goal is a 25MW supply, which translates to a demand for 600MWh per day. A quick scan of the web led me to Plug Power, a company with some good credentials, that supply electrolysers and fuel cells. Their product specs showed that a 1MW fuel cell can consume up to 62kg of hydrogen per MWh and an electrolyser can produce 4.25 tons of hydrogen daily at a consumption rate of 49.9 kWh/kg. This meant an hourly consumption of about 1.6 tons of hydrogen from ˜80MW of electrolysis, totalling a daily consumption of around 37.2 tons of hydrogen and 1.9GWh for electrolysis.
Green Hydrogen
Our client insisted on green hydrogen and indicated that he had the space to setup a solar park for this application. To meet our energy needs, assuming an equivalent of 4 peak sun hours per day, we’d require a ˜500MW solar park, covering up to 1000 hectares of land. The power output of the solar park would peak at 500MW during sunny hours, while electrolysis only needed around 80MW for a 25MW fuel cell output. This meant we had to find a way to store the excess power.
Excess power: into Batteries or H2
To store the excess power produced by the solar park, we had two options: batteries or hydrogen tanks. If we went with batteries, we’d need a Battery Energy Storage System (BESS) capable of storing up to 1.3GWh and releasing power at 80MW. On the other hand, storing the surplus as hydrogen would require more than 50 electrolysers operating during peak solar output and nearly 25 tons of H2 tank storage capacity.
How Much Water?
Theoretically, you need 9 litres of water to produce 1kg of hydrogen, but commercial electrolyser units often require more. Plug’s electrolyser, for instance, needs about 13 litres per kg of hydrogen. This meant processing and producing around 500 cubic meters of deionised water daily.
The Big Picture
Putting it all together, led to the following picture:
Picture this: use 1000ha to build a 500MW solar park to boil 500m3/day of water and store up to 1.6GWh of energy daily to produce 25MW 24/7. Now, the solar park on its own would cost more than 300 million USD. A rough estimate of the system takes us far north of half a billion USD.
Compare this to spending 20 million USD on a diesel power plant on less than 5ha or up to 100 million USD on a hydropower plant on less that 50ha to produce 25MW.
While the allure of hydrogen is undeniable, the reality is that it is not yet a practical or cost-effective solution, especially in Africa.
This effort sparked my curiosity on deriving the cost of electricity of such a system. Stay tuned, I may push another article with a more detailed view on the financials and economics of such a solution in another post.