Marketability analysis of green hydrogen production in Denmark: Scale-up effects on grid-connected electrolysis

Green hydrogen is produced through different methods in the lab but only a few technologies are commercialized. Cost reduction is widely expected to compete with the existing carbon-emitting alternatives. This paper compares alkaline, proton exchange membrane, and solid oxide electrolysis cells as the dominant technologies. Economic analyses with scale-up effects show meaningful differences between PEM and alkaline electrolyzers as relatively settled methods and solid oxide as an immature technology. Monte Carlo simulations on grid-connected electrolysis using the Danish electricity market confirm that both PEM and alkaline electrolyzers can already produce hydrogen with less than 3 €/Kg if taxes and levies are removed. The price may even drop below 2 €/Kg after the mass adoption of all three technologies. Furthermore, if electricity is delivered at half prices, the levelized cost of hydrogen falls around 1 €/Kg. The capabilities for cost reduction after scaling-up are 33%, 34%, and 50% in alkaline, PEM, and solid oxide electrolyzers respectively while they could get intensified with subsidization to 56%, 59%, and 70%. The results indicate that solid oxide electrolyzers can be as economical as alkaline and PEM ones. However, grey hydrogen seems to remain unbeatable without subsidized electricity and/or carbon tax adjustments.