IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v16y2023i14p5327-d1192223.html
   My bibliography  Save this article

A Techno-Economic Study for Off-Grid Green Hydrogen Production Plants: The Case of Chile

Author

Listed:
  • Marcelo León

    (Escuela de Ingeniería Química, Pontificia Universidad Católica de Valparaíso, Av. Brasil 2162, Valparaíso 2362854, Chile)

  • Javier Silva

    (Escuela de Ingeniería Química, Pontificia Universidad Católica de Valparaíso, Av. Brasil 2162, Valparaíso 2362854, Chile)

  • Rodrigo Ortíz-Soto

    (Escuela de Ingeniería Química, Pontificia Universidad Católica de Valparaíso, Av. Brasil 2162, Valparaíso 2362854, Chile)

  • Samuel Carrasco

    (Escuela de Ingeniería Química, Pontificia Universidad Católica de Valparaíso, Av. Brasil 2162, Valparaíso 2362854, Chile)

Abstract

In this study, we present a pre-feasibility analysis that examines the viability of implementing autonomous green hydrogen production plants in two strategic regions of Chile. With abundant renewable energy resources and growing interest in decarbonization in Chile, this study aims to provide a comprehensive financial analysis from the perspective of project initiators. The assessment includes determining the optimal sizing of an alkaline electrolyzer stack, seawater desalination system, and solar and wind renewable energy farms and the focus is on conducting a comprehensive financial analysis from the perspective of project initiators to assess project profitability using key economic indicators such as net present value (NPV). The analyses involve determining appropriate sizing of an alkaline electrolyzer stack, a seawater desalination system, and solar and wind renewable energy farms. Assuming a base case production of 1 kiloton per year of hydrogen, the capital expenditures (CAPEX) and operating expenses (OPEX) are determined. Then, the manufacturing and production costs per kilogram of green hydrogen are calculated, resulting in values of USD 3.53 kg −1 (utilizing wind energy) and USD 5.29 kg −1 (utilizing photovoltaic solar energy). Cash flows are established by adjusting the sale price of hydrogen to achieve a minimum expected return on investment of 4% per year, yielding minimum prices of USD 7.84 kg −1 (with wind energy) and USD 11.10 kg −1 (with photovoltaic solar energy). Additionally, a sensitivity analysis is conducted to assess the impact of variations in investment and operational costs. This research provides valuable insights into the financial feasibility of green hydrogen production in Chile, contributing to understanding renewable energy-based hydrogen projects and their potential economic benefits. These results can provide a reference for future investment decisions and the global development of green hydrogen production plants.

Suggested Citation

  • Marcelo León & Javier Silva & Rodrigo Ortíz-Soto & Samuel Carrasco, 2023. "A Techno-Economic Study for Off-Grid Green Hydrogen Production Plants: The Case of Chile," Energies, MDPI, vol. 16(14), pages 1-18, July.
    • Handle: RePEc:gam:jeners:v:16:y:2023:i:14:p:5327-:d:1192223
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/16/14/5327/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/16/14/5327/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Liu, Lintong & Zhai, Rongrong & Hu, Yangdi, 2023. "Performance evaluation of wind-solar-hydrogen system for renewable energy generation and green hydrogen generation and storage: Energy, exergy, economic, and enviroeconomic," Energy, Elsevier, vol. 276(C).
    2. Ludvik Viktorsson & Jukka Taneli Heinonen & Jon Bjorn Skulason & Runar Unnthorsson, 2017. "A Step towards the Hydrogen Economy—A Life Cycle Cost Analysis of A Hydrogen Refueling Station," Energies, MDPI, vol. 10(6), pages 1-15, May.
    3. David Jure Jovan & Gregor Dolanc, 2020. "Can Green Hydrogen Production Be Economically Viable under Current Market Conditions," Energies, MDPI, vol. 13(24), pages 1-16, December.
    4. Qusay Hassan & Imad Saeed Abdulrahman & Hayder M. Salman & Olushola Tomilayo Olapade & Marek Jaszczur, 2023. "Techno-Economic Assessment of Green Hydrogen Production by an Off-Grid Photovoltaic Energy System," Energies, MDPI, vol. 16(2), pages 1-20, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aurimas Lisauskas & Nerijus Striūgas & Adolfas Jančauskas, 2025. "Lower-Carbon Substitutes for Natural Gas for Use in Energy-Intensive Industries: Current Status and Techno-Economic Assessment in Lithuania," Energies, MDPI, vol. 18(11), pages 1-29, May.
    2. Zheng, Yi & You, Shi & Huang, Chunjun & Jin, Xin, 2023. "Model-based economic analysis of off-grid wind/hydrogen systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 187(C).
    3. Carlos Cacciuttolo & Martin Navarrete & Edison Atencio, 2024. "Renewable Wind Energy Implementation in South America: A Comprehensive Review and Sustainable Prospects," Sustainability, MDPI, vol. 16(14), pages 1-45, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kourougianni, Fanourios & Arsalis, Alexandros & Olympios, Andreas V. & Yiasoumas, Georgios & Konstantinou, Charalampos & Papanastasiou, Panos & Georghiou, George E., 2024. "A comprehensive review of green hydrogen energy systems," Renewable Energy, Elsevier, vol. 231(C).
    2. Luís Manuel Rodrigues & Tiago Soares & Igor Rezende & João Paulo Fontoura & Vladimiro Miranda, 2023. "Economic Analysis of a Hydrogen Power Plant in the Portuguese Electricity Market," Energies, MDPI, vol. 16(3), pages 1-17, February.
    3. Duan, Derong & Lin, Xiangyang & Wang, Muhao & Liu, Xia & Gao, Changqing & Zhang, Hui & Yang, Xuefeng, 2024. "Study on energy conversion efficiency of wave generation in shake plate mode," Energy, Elsevier, vol. 290(C).
    4. Sebastián Mantilla & Diogo M. F. Santos, 2022. "Green and Blue Hydrogen Production: An Overview in Colombia," Energies, MDPI, vol. 15(23), pages 1-21, November.
    5. Torsten Clemens & Martin Hunyadi-Gall & Andreas Lunzer & Vladislav Arekhov & Martin Datler & Albert Gauer, 2024. "Wind–Photovoltaic–Electrolyzer-Underground Hydrogen Storage System for Cost-Effective Seasonal Energy Storage," Energies, MDPI, vol. 17(22), pages 1-26, November.
    6. Aurimas Lisauskas & Nerijus Striūgas & Adolfas Jančauskas, 2025. "Lower-Carbon Substitutes for Natural Gas for Use in Energy-Intensive Industries: Current Status and Techno-Economic Assessment in Lithuania," Energies, MDPI, vol. 18(11), pages 1-29, May.
    7. Vidas, Leonardo & Castro, Rui & Bosisio, Alessandro & Pires, Armando, 2024. "Optimal sizing of renewables-to-hydrogen systems in a suitable-site-selection geospatial framework: The case study of Italy and Portugal," Renewable and Sustainable Energy Reviews, Elsevier, vol. 202(C).
    8. Matteo Genovese & David Blekhman & Michael Dray & Francesco Piraino & Petronilla Fragiacomo, 2023. "Experimental Comparison of Hydrogen Refueling with Directly Pressurized vs. Cascade Method," Energies, MDPI, vol. 16(15), pages 1-14, August.
    9. Razzaqul Ahshan, 2021. "Potential and Economic Analysis of Solar-to-Hydrogen Production in the Sultanate of Oman," Sustainability, MDPI, vol. 13(17), pages 1-22, August.
    10. Khalifeh Soltani, Sayed Rashid & Mostafaeipour, Ali & Mishra, Phoolendra & Alidoost, Sara & Jahangiri, Mehdi & Abrisham Kar, Mohammad, 2025. "Green hydrogen production and prediction using floating photovoltaic panels on wastewater ponds," Renewable Energy, Elsevier, vol. 243(C).
    11. Fan, Jing-Li & Yu, Pengwei & Li, Kai & Xu, Mao & Zhang, Xian, 2022. "A levelized cost of hydrogen (LCOH) comparison of coal-to-hydrogen with CCS and water electrolysis powered by renewable energy in China," Energy, Elsevier, vol. 242(C).
    12. Wagner, Dennis & Walther, Grit, 2024. "Techno-economic analysis of mixed battery and fuel cell electric bus fleets: A case study," Applied Energy, Elsevier, vol. 376(PA).
    13. Byoungjik Park & Yangkyun Kim & Kwanwoo Lee & Shinwon Paik & Chankyu Kang, 2021. "Risk Assessment Method Combining Independent Protection Layers (IPL) of Layer of Protection Analysis (LOPA) and RISKCURVES Software: Case Study of Hydrogen Refueling Stations in Urban Areas," Energies, MDPI, vol. 14(13), pages 1-13, July.
    14. Hu, Hang & Yang, Lingzhi & Yang, Sheng & Zou, Yuchi & Wang, Shuai & Chen, Feng & Guo, Yufeng, 2024. "Development and assessment of an integrated wind energy system for green steelmaking based on electric arc furnace route," Energy, Elsevier, vol. 302(C).
    15. Bhandari, Ramchandra & Shah, Ronak Rakesh, 2021. "Hydrogen as energy carrier: Techno-economic assessment of decentralized hydrogen production in Germany," Renewable Energy, Elsevier, vol. 177(C), pages 915-931.
    16. Arias, Ignacio & Battisti, Felipe G. & Romero-Ramos, J.A. & Pérez, Manuel & Valenzuela, Loreto & Cardemil, José & Escobar, Rodrigo, 2024. "Assessing system-level synergies between photovoltaic and proton exchange membrane electrolyzers for solar-powered hydrogen production," Applied Energy, Elsevier, vol. 368(C).
    17. Schrotenboer, Albert H. & Veenstra, Arjen A.T. & uit het Broek, Michiel A.J. & Ursavas, Evrim, 2022. "A Green Hydrogen Energy System: Optimal control strategies for integrated hydrogen storage and power generation with wind energy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 168(C).
    18. Tang, Zhenhua & Wang, Zhirong & Zhao, Kun, 2023. "Flame stabilization characteristics of turbulent hydrogen jet flame diluted by nitrogen," Energy, Elsevier, vol. 283(C).
    19. Genovese, M. & Piraino, F. & Fragiacomo, P., 2024. "3E analysis of a virtual hydrogen valley supported by railway-based H2 delivery for multi-transportation service," Renewable and Sustainable Energy Reviews, Elsevier, vol. 191(C).
    20. Sgaramella, Antonio & Pastore, Lorenzo Mario & Lo Basso, Gianluigi & de Santoli, Livio, 2023. "Optimal RES integration for matching the Italian hydrogen strategy requirements," Renewable Energy, Elsevier, vol. 219(P1).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:16:y:2023:i:14:p:5327-:d:1192223. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.