(228d) Drivers of Blue and Green Hydrogen Deployment in Net-Zero Emissions Scenarios

As the emphasis of decarbonization shifts from the electric power sector to other energy sectors, there is growing interest in hydrogen (H₂) and enabling technologies for decarbonizing end-use sectors in which direct electrification may be difficult or costly. The versatility of H₂, with multiple technologies for production, storage, transportation, and end-use, is one factor driving its growing appeal. However, this versatility also leads to multiple potential pathways and cross-sectoral interactions that complicate the assessment of H₂ infrastructure and its role in deeply decarbonized energy systems. For example, H₂ produced from electrolysis could be powered by co-located variable renewable energy (VRE) or by electricity sourced largely from VRE generators connected to the power grid. While the former is an islanded system, the latter directly impacts the electric power sector both in terms of increasing aggregate electricity demand and by potentially changing the time when peak demand occurs, thus affecting the integration of variable renewable energy (VRE).

In this study, we use an integrated energy systems approach to identify the impact of H₂ infrastructure flexibility and negative emission technologies (NETs) on the deployment of “green” H₂ (referring to electrolyzers) and “blue” H₂, which uses natural gas with carbon capture and sequestration (CCS). Specifically, we use an open-source, multi-sector capacity expansion model (MACRO) to investigate the drivers of green and blue H₂ deployment in a cost-optimized, net-zero energy system. The model represents the coupling between the electric power grid, H₂ infrastructure (production, storage, and transmission), and spatially resolved CO₂ storage and biomass resources. In addition, temporal variability in energy supply (e.g., VRE) and demand are captured through modeling hourly operations of the energy system over representative weeks, which enables us to capture the value of temporally-coupled resources such as battery and H₂ energy storage. We use the MACRO model to study the impact of H₂ infrastructure flexibility and availability of NETs on the cost-optimal deployment of H₂ production technologies in a 2050 net-zero case study of the contiguous United States. H₂ infrastructure flexibility is represented via scenarios with and without H₂ storage and pipelines, as well as alternative assumptions about the operational flexibility of blue H₂. Availability of NETs is varied by considering cases allowing direct air capture (DAC) alone, or by allowing both DAC and bioenergy with carbon capture and sequestration (BECCS).

We find that the mix of H₂ production is primarily affected by H₂ infrastructure flexibility such as H₂ storage and pipelines, and less so by NETs availability. When H₂ storage and pipelines are unconstrained, green H₂ accounts for the largest share of H₂ production in a net-zero system. Under these conditions, green H₂ exploits the flexibility of H₂ infrastructure to maximize electrolytic H₂ production at locations and times of low electricity prices and vice versa. On the other hand, blue H₂, which requires additional investments in NETs and CO₂ transport and storage, accounts for the largest share of H₂ production when the flexibility of green H₂ production is limited, such as when H₂ storage and pipeline deployment is constrained. Counterintuitively, increasing blue H₂ flexibility with limited H₂ storage and pipeline deployment increases green H₂ deployment, as it also enables operational flexibility of green H₂. Across all scenarios, we find that H₂production is generally co-located with demand, implying a smaller role for H₂ transmission relative to electricity transmission.

Our analysis also sheds light on the relative value of grid-connected vs. islanded H₂ systems under cost-optimized net-zero emissions constraints. We find that grid-connected systems meet a greater share of exogeneous H₂ demand using electrolyzers compared to islanded systems across different scenarios of H₂ infrastructure flexibility. This finding highlights potential synergies of co-optimizing electricity and H₂ production in decarbonized energy systems.