The economic potential of “green†hydrogen production and consumption in Russian regions

Relevance. The global energy agenda is focused on the transition to a carbon-neutral economy and ensuring the energy independence of governments. This has created the prerequisites for the “green†hydrogen energy, which presents the production of the most environmentally friendly energy sources. On the one hand, “green†hydrogen can be used as a storage system for subsequent energy supply to domestic needs. On the other hand, its export can become an effective direction, which will allow state not only to diversify the energy resources sold, but also to use new revenue sources for the budget. Research objective is to economically substantiate the priority areas of production and consumption of “green†hydrogen in Russian regions. Data and methods. The cases on the production of “green†hydrogen based on electricity from solar, wind and hydroelectric power plants in 14 Russian regions are considered. Scenarios for domestic consumption, as well as for the export of hydrogen to Asian and European countries through sea and pipeline transportation are proposed. The method to discounted assessment of the levelized cost of “green†hydrogen is proposed. It accounts the full costs of all stages of the project life cycle — from scientific research to equipment disposal. The decision on the project feasibility is based on a comparative assessment with the alternative prices of hydrogen. Results. The calculation of the levelized cost of hydrogen and electricity has shown that the domestic consumption of “green†hydrogen is not economically feasible in the territories with the centralized energy supply. In turn, the export of hydrogen abroad is becoming a promising direction. Conclusions. In the near future, economically feasible projects may be the export of Russian “green†hydrogen to Asian and European countries using both pipeline and sea transportation. However, not all Russian regions are able to ensure the optimal price level for national hydrogen. The proximity of regions to the hydrogen sale markets, as well as the maximum volume of hydrogen production become decisive factors in the formation of an effective levelized cost.