Clean hydrogen production cost targets set recently by the US government look “very challenging” given current green hydrogen costs in Europe, according to Professor Mohamed Pourkashanian, head of energy research at the UK’s University of Sheffield.

In June, the Biden administration issued a new goal of slashing the cost of clean hydrogen by 80pc, to $1/kg, within a decade.

“It is a fantastic opportunity to achieve that, but please keep in mind this is very challenging. Based on some data that I have seen from European gas, CO₂ or hydrogen producers, we are talking about green hydrogen around $6-7/kg,” he told the University of Sheffield’s ‘Accelerating Hydrogen’ virtual conference.

$6-7/kg – Green hydrogen costs in Europe

But Pourkashanian adds that the build-up of political will to support the deployment of clean hydrogen is well underway in the US, China, the EU and the UK.

“If you look at China, use of hydrogen is being inked into their 14th five-year plan as one of the six industries of the future. So that is an excellent commitment,” he says.

Innovative business models

Pourkashanian says next-generation technology and innovative business models will be crucial in lowering clean hydrogen costs in the same way as was seen with renewables costs over the past ten years.

“The importance of next-generation technology cannot be ignored, but where we need to do more is in business model innovation where there will be a lot of new players. Big data will become very important,” says Pourkashanian.

Reducing the cost of green hydrogen will require rapid scaling-up of electrolysis. However such a development is feasible, says Charles Purkess, director at UK-based electrolyser manufacturer ITM Power.

“The importance of next-generation technology cannot be ignored” Pourkashanian, University of Sheffield

ITM Power has increased the size of its electrolysers tenfold every two years—with the next step being a 100MW unit to be supplied to Shell in 2023.

“So there is a rapid scale-up, and that is facilitated through a lot of careful planning in terms of technology, the ability to scale-up using low-cost components at low risk and facilitating that production through the automation and semi-automation of equipment,” he says.

Scaling up

ITM recently completed its gigawatt factory at Bessemer Park in Sheffield. The firm is targeting a proton exchange membrane (PEM) electrolyser cost of €500/MW ($587/MW)  by the mid-2020s, having already lowered costs by 50pc since 2018, according to Purkess.

One of the constraints on scaling-up is the use of platinum group metals in PEM electrolysers. However, ITM has reduced the amount of the precious metal needed by 80pc over the last five years, putting it ahead of a 2030 target set by the EU.

ITM’s backlog of orders for electrolysers stands at a record 310MW with a pipeline of tenders for orders running to just over 1GW.

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Author: Stuart Penson