Hybot unveils hydrogen-powered heavy duty truck in Guangdong province, China

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6. HydrogenInsight: Cost of green hydrogen unlikely to fall 'dramatically' in coming years, admit developers

Cost of green hydrogen unlikely to fall 'dramatically' in coming years, admit developers

Renewable H₂ costs are actually increasing in the short term due to increased capex and shortages in electrolyser manufacturing capacity

25 September 2023 12:07 GMT UPDATED 25 September 2023 12:26 GMT
By Polly Martin

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The biggest factor behind the rise in cost is simply that the upstream renewables for hydrogen production are highly exposed to increases in the cost of capital.

“We are seeing… kind of a challenge because renewables cost, capex is increasing,” said Sopna Sury, chief operating officer for hydrogen at German utility RWE, although she notes that once the renewables plants are actually up and running, there is a “marginal cost of zero”.

While this means that green hydrogen is better shielded than grey or blue H₂ from spikes in gas prices — which last year led to some projections putting the cost of electrolysis below traditional steam methane reforming — it also means that renewable H₂ is more likely to get much more expensive with rising inflation.

“We also see in our projects some increasing capex numbers unfortunately,” German energy firm Uniper’s CEO for hydrogen Axel Wietfeld admitted in a separate presentation at the conference.

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