IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v18y2025i6p1325-d1607727.html
   My bibliography  Save this article

Stakeholder and Techno-Economic Assessment of Iceland’s Green Hydrogen Economy

Author

Listed:
  • Nargessadat Emami

    (Faculty of Civil and Environmental Engineering, School of Engineering and Natural Sciences, University of Iceland, 107 Reykjavík, Iceland
    Commonwealth Scientific and Industrial Research Organisation (CSIRO), Canberra 2601, Australia)

  • Reza Fazeli

    (School of Engineering, The Australian National University, Canberra 2601, Australia)

  • Til Seth Tzschockel

    (Environment and Natural Resources, School of Engineering and Natural Sciences, University of Iceland, 107 Reykjavík, Iceland)

  • Kevin Joseph Dillman

    (Environment and Natural Resources, School of Engineering and Natural Sciences, University of Iceland, 107 Reykjavík, Iceland)

  • Jukka Heinonen

    (Faculty of Civil and Environmental Engineering, School of Engineering and Natural Sciences, University of Iceland, 107 Reykjavík, Iceland)

Abstract

Green hydrogen is a promising energy carrier for the decarbonization of hard-to-abate sectors and supporting renewable energy integration, aligning with carbon neutrality goals like the European Green Deal. Iceland’s abundant renewable energy and decarbonized electricity system position it as a strong candidate for green hydrogen production. Despite early initiatives, its hydrogen economy has yet to significantly expand. This study evaluated Iceland’s hydrogen development through stakeholder interviews and a techno-economic analysis of alkaline and PEM electrolyzers. Stakeholders were driven by decarbonization goals, economic opportunities, and energy security but faced technological, economic, and governance challenges. Recommendations include building stakeholder confidence, financial incentives, and creating hydrogen-based chemicals to boost demand. Currently, alkaline electrolyzers are more cost-effective (EUR 1.5–2.8/kg) than PEMs (EUR 2.1–3.6/kg), though the future costs for both could drop below EUR 1.5/kg. Iceland’s low electricity costs and high electrolyzer capacity provide a competitive edge. However, this advantage may shrink as solar and wind costs decline globally, particularly in regions like Australia. This work’s findings emphasize the need for strategic planning to sustain competitiveness and offer transferable insights for other regions introducing hydrogen into ecosystems lacking infrastructure.

Suggested Citation

  • Nargessadat Emami & Reza Fazeli & Til Seth Tzschockel & Kevin Joseph Dillman & Jukka Heinonen, 2025. "Stakeholder and Techno-Economic Assessment of Iceland’s Green Hydrogen Economy," Energies, MDPI, vol. 18(6), pages 1-21, March.
    • Handle: RePEc:gam:jeners:v:18:y:2025:i:6:p:1325-:d:1607727
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/18/6/1325/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/18/6/1325/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. White, Lee V. & Fazeli, Reza & Cheng, Wenting & Aisbett, Emma & Beck, Fiona J. & Baldwin, Kenneth G.H. & Howarth, Penelope & O’Neill, Lily, 2021. "Towards emissions certification systems for international trade in hydrogen: The policy challenge of defining boundaries for emissions accounting," Energy, Elsevier, vol. 215(PA).
    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. Franco, Brais Armiño & Baptista, Patrícia & Neto, Rui Costa & Ganilha, Sofia, 2021. "Assessment of offloading pathways for wind-powered offshore hydrogen production: Energy and economic analysis," Applied Energy, Elsevier, vol. 286(C).
    4. Matthew G. Burgess & Leaf Boven & Gernot Wagner & Gabrielle Wong-Parodi & Kyri Baker & Maxwell Boykoff & Benjamin A. Converse & Lisa Dilling & Jonathan M. Gilligan & Yoel Inbar & Ezra Markowitz & Jona, 2024. "Supply, demand and polarization challenges facing US climate policies," Nature Climate Change, Nature, vol. 14(2), pages 134-142, February.
    Full references (including those not matched with items on IDEAS)

    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. Zheng, Yi & You, Shi & Bindner, Henrik W. & Münster, Marie, 2022. "Optimal day-ahead dispatch of an alkaline electrolyser system concerning thermal–electric properties and state-transitional dynamics," Applied Energy, Elsevier, vol. 307(C).
    2. Gokul Iyer & Alicia Zhao & Adriana Bryant & John Bistline & Geoffrey Blanford & Ryna Cui & Allen A. Fawcett & Rachel Goldstein & Amanda Levin & Megan Mahajan & Haewon McJeon & Robbie Orvis & Nathan Hu, 2025. "A multi-model study to inform the United States’ 2035 NDC," Nature Communications, Nature, vol. 16(1), pages 1-12, December.
    3. Ushnik Mukherjee & Azadeh Maroufmashat & Apurva Narayan & Ali Elkamel & Michael Fowler, 2017. "A Stochastic Programming Approach for the Planning and Operation of a Power to Gas Energy Hub with Multiple Energy Recovery Pathways," Energies, MDPI, vol. 10(7), pages 1-27, June.
    4. Tubagus Aryandi Gunawan & Alessandro Singlitico & Paul Blount & James Burchill & James G. Carton & Rory F. D. Monaghan, 2020. "At What Cost Can Renewable Hydrogen Offset Fossil Fuel Use in Ireland’s Gas Network?," Energies, MDPI, vol. 13(7), pages 1-23, April.
    5. Abdulrahman Joubi & Yutaro Akimoto & Keiichi Okajima, 2022. "A Production and Delivery Model of Hydrogen from Solar Thermal Energy in the United Arab Emirates," Energies, MDPI, vol. 15(11), pages 1-14, May.
    6. Zhang, Rui & Cao, Xuewen & Zhang, Xingwang & Yang, Jian & Bian, Jiang, 2024. "Co-benefits of the liquid hydrogen economy and LNG economy: Advances in LNG integrating LH2 production processes," Energy, Elsevier, vol. 301(C).
    7. Wiegner, J.F. & Andreasson, L.M. & Kusters, J.E.H. & Nienhuis, R.M., 2024. "Interdisciplinary perspectives on offshore energy system integration in the North Sea: A systematic literature review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 189(PA).
    8. Gao, Xianhui & Wang, Sheng & Sun, Ying & Zhai, Junyi & Chen, Nan & Zhang, Xiao-Ping, 2024. "Low-carbon energy scheduling for integrated energy systems considering offshore wind power hydrogen production and dynamic hydrogen doping strategy," Applied Energy, Elsevier, vol. 376(PA).
    9. Haugen, Molly J. & Paoli, Leonardo & Cullen, Jonathan & Cebon, David & Boies, Adam M., 2021. "A fork in the road: Which energy pathway offers the greatest energy efficiency and CO2 reduction potential for low-carbon vehicles?," Applied Energy, Elsevier, vol. 283(C).
    10. Rezaei, Mostafa & Akimov, Alexandr & Gray, Evan Mac A., 2024. "Techno-economics of offshore wind-based dynamic hydrogen production," Applied Energy, Elsevier, vol. 374(C).
    11. Pastore, Lorenzo Mario & Lo Basso, Gianluigi & Sforzini, Matteo & de Santoli, Livio, 2022. "Technical, economic and environmental issues related to electrolysers capacity targets according to the Italian Hydrogen Strategy: A critical analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 166(C).
    12. Anna Christy & Marwa Elnahass & Jaime Amezaga & Anthony Browne & Oliver Heidrich, 2024. "A dynamic framework to align company climate reporting and action with global climate targets," Business Strategy and the Environment, Wiley Blackwell, vol. 33(4), pages 3103-3128, May.
    13. Thijs Bouman & Linda Steg & Tom Dietz, 2024. "The public demands more climate action, not less," Climatic Change, Springer, vol. 177(11), pages 1-8, November.
    14. 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).
    15. 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.
    16. 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.
    17. Leaf Van Boven & Matthew G. Burgess, 2024. "Introduction to topical collection: social science and sustainability technology," Climatic Change, Springer, vol. 177(4), pages 1-6, April.
    18. Sleiti, Ahmad K. & Al-Ammari, Wahib A. & Musharavati, Farayi, 2024. "Novel integrated system for power, hydrogen, and ammonia production using direct oxy-combustion sCO2 power cycle with automatic CO2 capture, water electrolyzer, and Haber-Bosch process," Energy, Elsevier, vol. 307(C).
    19. Paula Heeß & Jakob Rockstuhl & Marc-Fabian Körner & Jens Strüker, 2024. "Enhancing trust in global supply chains: Conceptualizing Digital Product Passports for a low-carbon hydrogen market," Electronic Markets, Springer;IIM University of St. Gallen, vol. 34(1), pages 1-20, December.
    20. Kazuhiro Hikima & Masaharu Tsujimoto & Mizutomo Takeuchi & Yuya Kajikawa, 2020. "Transition Analysis of Budgetary Allocation for Projects on Hydrogen-Related Technologies in Japan," Sustainability, MDPI, vol. 12(20), pages 1-15, October.

    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:18:y:2025:i:6:p:1325-:d:1607727. 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.