Blue and green hydrogen–An analysis of competing pathways and their impact on the European energy system

Clean hydrogen is a central part of the European energy transition strategy. With the targeted scale-up of clean hydrogen production still ahead, questions persist regarding the impacts of different hydrogen production pathways on the energy system. Using the Balmorel energy system model, this study analyzes the impacts of green, blue, and mixed hydrogen production pathways for the European energy system in 2040. We examine electricity prices, hydrogen- and renewable capacity investments, and flexibility options. A cost-minimizing hydrogen pathway overwhelmingly favors blue hydrogen (98 %), but a mix of blue and green hydrogen reduces renewable curtailment and electricity price variability. In mixed scenarios, the highest shares of new electrolyzer capacities and renewable generation capacity investments are located in Northern and Southern Europe, benefiting from favorable wind and solar conditions. A fully green hydrogen pathway would strain available renewable potentials, leading to investments in economically less favorable technologies, and increase system costs. Additionally, the results show that the flexibility provided by electrolyzers reduces the need for other demand-side flexibility. However, at very high green hydrogen shares we observe an increased demand for supply-side flexibility, particularly from natural gas-powered peak plants during winter months.