Economic evaluation and feasibility design of an electricity-hydrogen market with hydrogen-based system: Mathematical model and techno-economic analysis

The primary challenges hindering the utilization of renewable energy sources (RES) to generate electricity is the intermittency and the high seasonal demand fluctuation. In this paper, an optimum hydrogen-based configuration has been proposed to mitigate RES curtailments through water electrolysis for hydrogen production and storage. Firstly, a systematic electrolysis model was developed analyzing the dynamic relationships between current curves and cell voltage at operational temperatures. Secondly, an electricity-hydrogen market framework is designed to assess the prospects of introducing hydrogen-based systems in the electricity supply (the power generation plant is the investment entity) or demand side (the electric power company is an investment entity). Moreover, a dynamic electricity-hydrogen pricing model is explored to establish local marginal price (LMP) mechanism for the electricity-hydrogen market. Finally, a numerical analysis is conducted using an illustrative example. Our analysis revealed that the hydrogen-based system is better suited to be invested by power generation plants, as the break-even point can be achieved in market transactions. Its most beneficial configuration is to produce hydrogen during electricity off-peak and sell it directly to end users in hydrogen market. As long as the hydrogen selling price reaches 55.223 yuan/kgH2, economic balance can be realized compared with the non-hydrogen-based system.