The value of power-to-gas-to-power in Switzerland ’s electricity system planning

Key to a climate-neutral energy system, sector coupling has emerged as a flexibility source for the power network to tackle challenges associated with the growing share of renewable generation and the decommissioning of conventional dispatchable generators. This paper investigates the role of power-to-gas-to-power in generation expansion planning, employing a detailed model for an electrolyzer, a hydrogen storage, a hydrogen-to-power technology, and a methanation reactor coupled with direct air capture. The model also considers synthetic gas imports to evaluate their trade-off with domestic production. The model is used to investigate net-zero scenarios for Switzerland and neighboring countries. The results suggest that electrolysis is an attractive investment if excess renewable electricity sustains a hydrogen production capacity factor above 16%. However, the benefits to the Swiss power system alone – such as the potential to reduce renewable investments while achieving a renewable target and the potential to relieve network congestion – do not warrant investments in power-to-gas under normal power trade capacities. In the case of a final hydrogen demand, a shift towards domestic production over hydrogen imports occurs for import prices exceeding 2,750 €/tonne. Methanation shows little economic viability for carbon prices below 500 €/tonne. Hydrogen-to-power is deployed only under reduced cross-border power trade or very low hydrogen import prices.