Impact of different carbon policies on integrated planning of hydrogen supply chain and power system

The vast majority of current hydrogen (H2) production is carbon-intensive, and H2 supply chain (HSC) infrastructure remains inadequate for supporting a large-scale H2 economy. Planning HSC expansion is difficult due to diverse technical options in H2 production, transportation, and storage, as well as the intertwined relationship between HSC and the power system (PS). Evolving carbon policies add further complexity, yet their impact on a jointly planned HSC–PS system is not well understood. In this study, we develop a mixed integer linear programming model to optimally expand the HSC and PS, accounting for various technological options. We systematically analyze and compare the impact of three representative carbon policies (non-tradable carbon allowance, carbon tax, and cap-and-trade) on the integrated system. Our results show that under all analyzed policies, blue H2 plays a pivotal role in decarbonization when CCS costs are moderate. When blue H2 is considered and its cost is no more than 30% higher compared to the base level, HSC–PS interactions are only pronounced in deep decarbonization scenarios. Although carbon taxes grant firms more flexibility than non-tradable carbon allowances, they incur higher costs to reach similar emission cuts. For price-taking participants in a cap-and-trade system, the carbon price primarily dictates emissions and allowance trading decisions, while pre-assigned allowances influence the total cost. These findings offer valuable guidance for companies and policymakers seeking to design effective carbon regulations and invest strategically in HSC and PS infrastructure.