Investigating the impact of variable energy prices and renewable generation on the annualized cost of hydrogen.

Hydrogen can be produced from onsite renewable energy, energy from the power grid, or a combination of both. While the cost of grid energy is driven by the energy prices, onsite renewable investments are driven by the levelized cost of renewable energy. Energy prices can widely vary in time and in different locations, potentially having a large impact on the annualized cost of hydrogen (ACOH). Renewable sources can also vary significantly for different locations and seasons. In this paper, we develop a semi-empirical model to find key ACOH locational drivers and trends. The model finds the optimal capacity of the onsite solar and wind generators and the electrolyzer, together with the optimal use of grid energy. We found that an optimal balance between onsite renewable investments and grid energy use is strongly driven by the type of energy price (fixed or variable) and location. • Sizing onsite renewables and electrolyzers for different grid energy prices. • Onsite renewables versus grid energy, largely driven by energy prices and location. • Combined solar-wind capacity factor is key driver of the optimal energy use. • Significant hydrogen production from low-cost grid renewable energy. • Transmission congestion plays a key role in increasing the use of grid renewable energy. [ABSTRACT FROM AUTHOR]