Benefits from Islanding Green Hydrogen Production

TL;DR

This study compares the benefits of integrated versus islanded green hydrogen production, showing that islanded electrolysers become more advantageous at higher hydrogen demand levels and can significantly reduce costs depending on local conditions.

Contribution

It provides a comparative analysis of integrated and islanded electrolysers across multiple countries, identifying thresholds and investment regimes for optimal deployment.

Findings

Integrated electrolysers offer flexibility below 5-40% hydrogen share.

Islanded electrolysers reduce costs by up to 21-40% depending on country and cost advantages.

Country-specific transition points depend on renewable resources and island cost benefits.

Abstract

In wind- and solar-dominated energy systems it has been assumed that there are synergies between producing electricity and electrolytic hydrogen since electrolysis can use excess electricity that would otherwise be curtailed. However, it remains unclear whether these synergies hold true at higher levels of hydrogen demand and how they compare with benefits of off-grid, islanded hydrogen production, such as better renewable resources and cost savings on electronics due to relaxed power quality standards. Using a mathematical model across two geographical locations for Germany, Spain, Australia, and Great Britain, we explore trade-offs and synergies between integrated and islanded electrolysers. Below a certain threshold, between 5% and 40% hydrogen share depending on the country, integrated electrolysers offer synergies in flexibility and reduced curtailment. Above these thresholds, islanded electrolysers become more favourable. Without cost advantages, systems including islanded electrolysers in Germany achieve up to 21% lower hydrogen costs than systems with only integrated electrolysers. With 25% island cost advantage, this benefit rises to 40% lower hydrogen costs. Our study identifies three investment regimes with country-specific transition points that vary based on island cost advantages and each country's renewable resources. Based on our results we provide guidelines for countries considering how to deploy electrolysers.