Impact of delivery time, local renewable sources, and generation curtailment on the levelized cost of hydrogen

Supply schemes, specifically delivery times, are essential factors in the resulting final cost of fuels. It is the particular case of hydrogen produced from variable renewable energies. However, the impact of different delivery times on the levelized cost of hydrogen (LCOH) remains unclear. This paper assesses the combined impact of different delivery times, local renewable sources, and onsite generation curtailment on the LCOH. We developed an optimization model of an electrolysis-based hydrogen plant and found key LCOH locational drivers and trends. The model uses hourly solar PV and wind generation data for four locations in Chile and optimizes the capacities of the onsite solar and wind generators, electrolyzers, storage tanks, and compressors. In all the locations examined, we found an almost linear relationship between LCOH and delivery time. LCOH values for a daily delivery range from 2.4 to 3.4 $US/kg (for different locations). Values for a delivery time of 120 days range from 12.2 to 13.6 $US/kg. These are explained by the almost linear increase in storage costs with respect to delivery time, despite the variability of renewable energies at the analyzed locations. Production costs remain almost constant for different delivery times. Furthermore, we obtained that curtailment could decrease LCOHs between 5% and 40%, by increasing the electrolyzer's capacity factor and decreasing the storage size. Moreover, we show that off-grid solar-dominant scenarios are strongly affected by the lack of solar energy in winter, increasing LCOHs considerably.