Comparison of techno-economic assessment of centralized and distributed hydrogen production using proton exchange electrolysis in Malaysia

Abstract

The global demand for sustainable and renewable energy resources as a substitute for fossil-based fuels is increasing in tandem with the advancement of renewable energy technologies. Therefore, hydrogen is a potential candidate for an efficient instrument for massive-scale energy production and storage. This study aim to quantify the techno-economic benefits of centralised and distributed hydrogen production using proton exchange membrane electrolysis in Malaysia. Malaysia wants to implement renewable energy, and hydrogen is one of the energy carriers. An assessment of the capital and operating cost of hydrogen production is required. In Malaysia, the hydrogen economy based on centralised and distributed hydrogen production via PEM electrolysis has yet to be computed. The research methodology used technical and financial input parameters were analyzed using the H2A model v3 2018 spreadsheet and discounted cash flow analysis for hydrogen production costs. The capital expenditure and operating, maintenance, and repair costs were calculated, and a solar PV system was installed to power the PEM electrolyzer system. The research findings show that the highest cost of electricity and capital costs of hydrogen production was recorded, while fixed operating and maintenance costs are found to be lower in centralised H2 production. For distributed H2 production, it was found that the costs of electricity consumption for a kilogram of hydrogen are much higher, followed by the capital cost of hydrogen and lower fixed operating and maintenance costs were observed. The cost of a unit of hydrogen in centralised hydrogen production is lower than in distributed hydrogen production at RM19.94/kgH2 (USD4.48/kgH2) and RM10.15/kgH2 (USD2.28/kgH2), for the centralised and distributed, respectively. It is suggested that centralised H2 hydrogen production is more promising and had a lower cost of production when implemented. The higher cost of hydrogen storage was recorded using tube trailer, which involves the higher capital cost and lower operating cost for the tube trailer storage at a rate of RM2,014,353/trailer (USD445,562/trailer) and RM31,963/trailer (USD7,181/trailer). Based on the two scales of production it concludes that, centralized H2 production had a lower cost of producing a kg of hydrogen than distributed H2 production. Installing a solar PV system greatly impacts the price of green hydrogen GH2.