NREL’s Price Examine On Hydrogen For Heavy Automobiles Gasoline Does Not Face up to Scrutiny

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What’s it about hydrogen for trucking that leads researchers to deeply low-ball prices at each alternative? I’ve tried to reply this query a number of occasions. In Germany, gruppendenken — groupthink — is clearly concerned. With organizations just like the ICCT, it seems a determined try and make hydrogen work as a result of they suppose it’s crucial results in error after error. Totally different points plague different hydrogen for power reviews the place main consultancies like DNV produce unhealthy reviews for shoppers who’re paying them to get particular outcomes, no matter actuality.

I’ve tended to anticipate higher of the US nationwide laboratories, which have principally been stable researchers and analysts. However in latest months, I’m discovering myself scratching my head at among the outcomes. A number of weeks in the past I regarded by a DOE NREL report on the hydrogen refueling stations in California. The information there was clear.

The refueling stations had been barely getting used even at their highest historic volumes, averaging 54 kilograms a day per station throughout the first half of 2021. The report didn’t point out that very low utilization, however as an alternative celebrated a 300 kilograms a day peak utilization.

The stations had been out of service for two,000 extra hours than they had been really pumping hydrogen, 20% extra downtime than productive utilization. However you had dig by the info and do some math to determine that out.

If the stations had been working at full capability, they might seemingly have been costing 30% of capital expenditure to keep up per yr. Upkeep prices had been over $9 per kilogram allotted. As soon as once more, the info was there, however the conclusion was lacking in motion.

The report was a masterpiece of deceptive the folks it was introduced to into pondering that issues had been rosy in hydrogen refueling stations in California. The fact is evidenced by Shell leaving cash on the desk, refusing $48 million to construct extra of them and shutting down its seven current light-vehicle refueling stations.

And now a brand new report from the USA’s Nationwide Renewable Power Lab (NREL), a division of the Division of Power, one with outstanding assumptions. Levelized Price of Disbursed Hydrogen for Heavy-Obligation Automobiles is sizzling off the presses in March of 2024. It presents a rosy image of cheap hydrogen prices.

That’s a comforting diagram, isn’t it? As quickly as hydrogen trucking is scaled, then refueling will value solely $6.5 per kilogram. That’s solely a bit above diesel at its present California price that’s hovering round $5 per gallon, an equal quantity of power. And provided that gasoline cells are extra environment friendly than diesel engines, that truly means hydrogen goes to be cheaper as a trucking gasoline than diesel!

However wait, there’s extra.

Sure, per this NREL research, hydrogen can be cheaper than diesel for a similar power. Nicely, drawback solved, let’s all go house. Trucking is sorted.

Yeah, not so quick. Check out the highest of every of these bars, the bit with $1.5 in it. What’s that?

“… the present evaluation assumes that the price of producing hydrogen that’s later delivered to the modeled 2030 fueling stations is $1.50/kg-H2”

That’s the present value of producing grey hydrogen per kilogram within the USA from low-cost pure gasoline at industrial-scale services. A US governmental research in 2024 had the chance to place in an applicable value of producing low-carbon hydrogen and bailed. As a reminder, the common for inexperienced hydrogen offers in Europe from 2024 was €9.49 per kilogram or $10.30. Nobody is pondering that truly low-carbon hydrogen goes to value $1.50 per kilogram in 2024, but it’s in an official NREL report and is artificially deflating the worth level.

As Boston Consulting Group reported, inexperienced hydrogen in 2030 is just not even going to get all the way down to the prior consensus determine — a consensus amongst STEM and financial illiterate hopium addicts — of €3, however could be within the vary of €5-€8. The underside finish of that vary continues to be very optimistic. My projection, after value workups for manufacturing hydrogen on three continents with a number of situations, is that inexperienced hydrogen will common $6-$8 per kilogram, with some outliers that can be each decrease and better.

Nevertheless it’s a good worse assumption for making hydrogen at stations. That’s one thing that the ICCT did in its fatally flawed research, however even the ICCT didn’t get issues so fallacious as to make use of a value level of $1.5 per kilogram.

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The total value of producing hydrogen in smaller portions can be a lot larger than the price of manufacturing it in industrial-scale services for 3 causes. First, the refueling station will nonetheless want all the steadiness of plant, however will probably be tiny elements, not scaled, low-cost for the amount elements. Hooking all of them collectively requires all the electricians, plumbers, chemical engineers, welders, and the like, however they’ll be tiny connections and welds.

The second motive is that stations can be paying someplace on the order of business charges for electrical energy. The US common is $0.11 per kWh at current and with steadiness of plant it takes about 55 kWh to fabricate a single kilogram of hydrogen from water. Simply the electrical energy will value $5,50, $4 above the price level the NREL research makes use of. And California’s industrial charges averaged $0.17 over 2022. That’s $9.35 only for the electrical energy for onsite manufacturing.

Third, an industrial facility has rigorous preventative upkeep and onsite employees to deal with points instantly to keep up manufacturing. Hydrogen refueling stations received’t have that as a result of the price of sustaining high-cost labor on them can be prohibitive. They’ll be both out of service much more of the time or can be paying for restore employees to be twiddling their thumbs and having high-cost elements standing by on website.

Might NREL have checked out actual information and made a more sensible choice about value level for onsite manufacturing of hydrogen? Sure, they might have regarded on the California hydrogen bus information.

That’s a mean of $12.60 only for electrical energy and a few minor ins and outs. It clearly doesn’t embrace the price of sustaining the refueling facility, which was out of service as a consequence of electrolyzer and steadiness of plant issues a full 14% of the yr. As famous for gentle automobile refueling stations, the common value of upkeep labored out to be above $9 per kilogram.

Additionally as famous, upkeep prices for pumping hydrogen, or something actually, scale linearly. Compressors, pumps, and seals give out extra quickly with extra use. Because the heavy automobile pumping facility information above exhibits, it’s not restricted to gentle autos in any respect. 700 atmospheres of stress in tanks has to exceed 800 atmospheres of compression with the intention to fill automobile tanks. That’s a stress which is the equal of being greater than 5 miles beneath the floor of the ocean. It’s non-trivial to construct one thing with the tolerances to attain that and compressors at that stage fail rather more usually than compressors for fridges.

And no, shifting to liquid hydrogen received’t get monetary savings. It simply has completely different giant and unavoidable bills, not least of which that it requires a 3rd of the embodied power within the type of electrical energy to run very refined cryogenic gear to get it down to twenty° above absolute zero. Buying and selling one set of prices and engineering compromises for a distinct set is not going to end in low-cost hydrogen.

This value of electrical energy doesn’t have any of the capital prices of the electrolyzer, the price of capital, the upkeep prices, or any earnings. The true value of hydrogen is undoubtedly over $20 per kilogram. Whereas it’s for an order of magnitude much less allotting of hydrogen per day than the bottom certain of the brand new NREL research, the prices of electrical energy are nonetheless going to be excessive.

The NREL research at the least provides capital prices to the price per kilogram, so far as I can inform. The diagrams of LCOH make it clear that for the on-site manufacturing situations they’ve added $1.1 to $4 to the price of a kilogram of hydrogen from the price of the station, however nowhere within the report do they specify what goes into that value. There isn’t any readability about electrolyzers, steadiness of plant, or anything for the manufacturing facet.

Presumably this was to permit somebody to place a steam reformation plant at a hydrogen refueling station in some deeply backward answer, allowing the expertise agnosticism that the report is aiming for round hydrogen manufacturing. Does this stand as much as the slightest scrutiny? No.

The price of pure gasoline for industrial clients in California is presently $12.52. Hydrogen is 1 / 4 of the mass of methane, which is usually 92% of the mass of pure gasoline. Different effectivity challenges make a ratio of a kilogram of hydrogen for each 5 kilograms of pure gasoline about proper. At that price, simply the pure gasoline enter to steam reformation would value $2.61, over a greenback greater than the price of hydrogen manufacturing assumed within the report. And that’s for grey hydrogen.

Given the small scale of the power and the necessity to bolt on carbon seize and do one thing with the carbon dioxide afterward, the prices are seemingly triple that.

The $1.50 value level of hydrogen within the report is simply defensible if the belief is grey hydrogen manufactured in industrial services in locations the place pure gasoline is cheaper than in California, one thing that’s precisely reverse to the purpose of decarbonizing trucking with hydrogen. The idea within the report is that hydrogen is manufactured inside 62 miles of refueling stations, so it’s going to be paying native industrial charges for pure gasoline if that’s the plan.

This report additionally frames the query as hydrogen vs hydrogen, versus as hydrogen vs electrification. That’s the transient that the staff had, and it’s the identical transient that one of many researchers had in 2020 once they printed Hydrogen Supply and Meting out Price, The highest finish of that research was half of hydrogen quantity as the underside finish of this research, and the outcomes are about the identical because the lowest quantity state of affairs, however absolutely excluded hydrogen manufacturing prices.

In different phrases, a research from the identical group from 4 years in the past discovered that simply delivering hydrogen was as costly as the complete stack on this value workup. Possibly they didn’t use the identical fashions? Nope. The mannequin is identical, only a completely different model, the Hydrogen Supply Situation Evaluation Mannequin (HDSAM), 3.1 vs 4.5.

Regardless of 4 extra years of proof that delivering and allotting hydrogen is costlier than estimated and quite a lot of proof that making hydrogen prices much more than $1.50, this new NREL report really has end-to-end manufacturing, supply, and allotting prices go down.

It’s like validating towards the empirical actuality of hydrogen for power and even acknowledging it’s not a requirement within the NREL anymore. It’s just like the many years of expertise with a number of ranges of hydrogen refueling stations and supply of hydrogen goes to be overturned by 2030. That’s disturbing.

After all, nobody within the worth chain within the situations on this report is making a revenue, and even making use of a markup to cowl their prices. The report clearly states this, however as everybody goes to be wanting on the major graphics, evaluating the prices to the retail value of diesel and respiratory huge sighs of reduction, that’s simply not an awesome selection both.

However in addition they explicitly exclude all the potential value decreasing subsidies out there for low-carbon fuels:

• Various Gasoline Car Refueling Property Credit score (30C) for certified different gasoline automobile fueling property
• Credit score for Manufacturing of Clear Hydrogen (45V)
• Certified Superior Power Venture Credit score (48C)
• Credit score for certified business clear autos (45W)

Is that related? In actuality no, however in notion sure. The centralized industrial hydrogen electrolysis manufacturing facility at the least has the potential for energy buy agreements that meet 45V necessities for locality, temporality, and additionality of low-carbon technology of electrical energy. That may get the price per kilogram down into the $2-$3 vary after the subsidy. As famous in my evaluation of the ICCT’s flawed report, native refueling stations received’t be capable of obtain this. And blue hydrogen is not going to qualify for 45V and would solely get a lot decrease carbon seize credit.

In different phrases, any remotely decarbonized hydrogen at refueling stations, no matter pathway, taking off subsidies and including cheap assumptions about markups for prices and earnings results in vastly larger than $1.50 hydrogen. It’s simply not defensible as a selection in 2024, even for centralized services. At small services at refueling stations it’s doubly indefensible.

But this report and particularly its charts are going go away lots of people with the misunderstanding that hydrogen at refueling stations can be grime low-cost. In the event that they discover the $1.50 in any respect and are disturbed it, they’ll see all the rebates and suppose that they’ll be relevant and issues can be high-quality.

A transparent takeaway is that NREL ought to be reassessing its HDSAM mannequin. It’s producing outcomes that aren’t aligned with empirical actuality, and the researchers look like unwilling or unable to place up their fingers and say so. Mannequin reverence is one thing I identified in my evaluation of the PIK Potsdam Institute for Local weather Influence Analysis associated to its LIME-EU and REMIND fashions, each of which have very low value hydrogen prices embedded in them, one thing researchers in a single main report clearly missed. The NREL researchers ought to be studying Thompson’s Escape from Mannequin Land and have the braveness to use skilled judgment.

The NREL report does the dialogue across the precise value of hydrogen for trucking in comparison with alternate options a major disservice. Like many different reviews, it’s artificially low-balling the prices of hydrogen. Why? It’s exhausting to say. Maybe as a result of the truth of the prices is clearly not remotely economically viable they usually actually don’t need to be those to face up and be counted.