Economic and Environmental Assessment of Hydrogen Production from Brazilian Energy Grid

José Carlos Curvelo Santana (), Pedro Gerber Machado, Cláudio Augusto Oller do Nascimento and Celma de Oliveira Ribeiro
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José Carlos Curvelo Santana: Department of Industrial engineering, Polytechnic School, São Paulo University, Av. Prof. Luciano Gualberto, 380-Butantã, São Paulo 05508010, SP, Brazil
Pedro Gerber Machado: Department of Industrial engineering, Polytechnic School, São Paulo University, Av. Prof. Luciano Gualberto, 380-Butantã, São Paulo 05508010, SP, Brazil
Cláudio Augusto Oller do Nascimento: Department of Chemical Engineering, Polytechnic School, São Paulo University, São Paulo 05508010, SP, Brazil
Celma de Oliveira Ribeiro: Department of Industrial engineering, Polytechnic School, São Paulo University, Av. Prof. Luciano Gualberto, 380-Butantã, São Paulo 05508010, SP, Brazil

Energies, 2023, vol. 16, issue 9, 1-21

Abstract: The Brazilian energy grid is considered as one of the cleanest in the world, because it is composed of more than 80% of renewable energy sources. This work aimed to apply the levelized costs (LCOH) and environmental cost accounting techniques to demonstrate the feasibility of producing hydrogen (H 2 ) by alkaline electrolysis powered by the Brazilian energy grid. A project of hydrogen production, with a lifetime of 20 years, had been evaluated by economical and sensitivity analysis. The production capacity (8.89 to 46.67 kg H 2 /h), production volume (25 to 100%), hydrogen sale price (1 to 5 USD/kg H 2 ) and the MAR rate were varied. Results showed that at 2 USD/kg H 2 , all H 2 production plant sizes are economically viable. On this condition, a payback of fewer than 4 years, an IRR greater than 31, a break-even point between 56 and 68% of the production volume and a ROI above 400% were found. The sensitivity analysis showed that the best economic condition was found at 35.56 kg H 2 /h of the plant size, which generated a net present value of USD 10.4 million. The cost of hydrogen varied between 1.26 and 1.64 USD/kg and a LCOH of 37.76 to 48.71 USD/MWh. LCA analysis showed that the hydrogen production project mitigated from 26 to 131 thousand tons of CO 2 , under the conditions studied.

Keywords: hydrogen production; energy grid; environmental cost accounting; levelized cost of hydrogen; carbon credit (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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