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Hydrogen in Grid Balancing: The European Market Potential for Pressurized Alkaline Electrolyzers

Abstract

To limit the global temperature change to no more than 2 ◦C by reducing global emissions, the European Union (EU) set up a goal of a 20% improvement on energy efficiency, a 20% cut of greenhouse gas emissions, and a 20% share of energy from renewable sources by 2020 (10% share of renewable energy (RE), specifically in the transport sector). By 2030, the goal is a 27% improvement in energy efficiency, a 40% cut of greenhouse gas emissions, and a 27% share of RE. However, the integration of RE in energy system faces multiple challenges. The geographical distribution of energy supply changes significantly the availability of the primary energy source (wind, solar, water) and is the determining factor, rather than where the consumers are. This leads to an increasing demand to match supply and demand for power. Especially intermittent RE like wind and solar power face the issue of energy production unrelated to demand (issue of excess energy production beyond demand and/or grid capacity) and forecast errors leading to an increasing demand for grid services like balancing power. Megawatt electrolyzer units (beyond 3 MW) can provide a technical solution to convert large amounts of excess electricity into hydrogen for industrial applications, substitute for natural gas, or the decarbonization of the mobility sector. The demonstration of successful MW electrolyzer operation providing grid services under dynamic conditions as request by the grid can broaden the opportunities of new business models that demonstrate the profitability of an electrolyzer in these market conditions. The aim of this work is the demonstration of a technical solution utilizing Pressurized Alkaline Electrolyzer (PAE) technology for providing grid balancing services and harvesting Renewable Energy Sources (RES) under realistic circumstances. In order to identify any differences between local market and grid requirements, the work focused on a demonstration site located in Austria, deemed as a viable business case for the operation of a largescale electrolyzer. The site is adapted to specific local conditions commonly found throughout Europe. To achieve this, this study uses a market-based solution that aims at providing value-adding services and cash inflows, stemming from the grid balancing services it provides. Moreover, the work assesses the viability of various business cases by analyzing (qualitatively and quantitatively) additional business models (in terms of business opportunities/energy source, potential grid service provision, and hydrogen demand) and analyzing the value and size of the markets developing recommendations for relevant stakeholder to decrease market barriers.

Funding source: The current work has been partially funded by Demo4Grid & H2TRANS projects.
Related subjects: Policy & Socio-Economics
Countries: Austria ; Greece ; Spain
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/content/journal2991
2022-01-17
2022-07-05
http://instance.metastore.ingenta.com/content/journal2991
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