Cost of hydrogen from different sources

by Greg Blencoe on November 9, 2009

California gas prices in July 2008

What is the cost of hydrogen per kilogram?

This is a simple question without a simple answer.

Many different ways to produce and distribute hydrogen

The cost of hydrogen per kilogram depends on many factors.

For example, how is the hydrogen produced?  Is it produced from natural gas, wind, nuclear, solar, or some other way?

If it is produced from natural gas, is the hydrogen made at the fueling station?  Or is it produced off-site and then delivered by truck?

If hydrogen is produced from wind power, how far away is the hydrogen fueling station from the wind-to-hydrogen production facility?  Is it closer to 10 miles, 100 miles, or 1000 miles away?

And is the fueling station in a very expensive location like Beverly Hills, California or a very inexpensive location like Amarillo, Texas?

The point is that there are a large number of factors that will affect the cost of hydrogen.

Miles per kilogram of hydrogen

Before estimating the cost of hydrogen per kilogram from various sources, the benefits of a kilogram of hydrogen need to be shown.  How does a kilogram of hydrogen used in a fuel cell vehicle compare with a gallon of gasoline used in an internal combustion engine vehicle?

The Toyota FCHV-adv hydrogen fuel cell vehicle (mid-size SUV) is basically a Toyota Highlander Hybrid with a fuel cell.  The Toyota FCHV-adv recently achieved 68.3 miles per kilogram in a real-world test with the Department of Energy.  On the other hand, the Toyota Highlander Hybrid gets an EPA-rated 26 miles per gallon.

The Toyota fuel cell vehicle is 2.63 times as efficient as the gasoline version.  Furthermore, a rule of thumb is that fuel cells are 2-3 times as efficient as internal combustion engines.

Therefore, a reasonable figure to use is 2.5 times as efficient.  This means the cost estimates below need to be divided by 2.5 to get the equivalent cost of a gallon of gasoline (i.e. $4 to $12 per kilogram of hydrogen is equivalent to gasoline at $1.60 to $4.80 per gallon).

Points to mention before showing cost estimates

Before providing the cost figures, a few things need to be mentioned:

1.  Taxes are included.

The average cost for gasoline taxes in the U.S. is currently about $0.50 per gallon.

Since a kilogram of hydrogen in a fuel cell will power a vehicle approximately 2.5 times as far as a gallon of gasoline in an internal combustion engine, the current average for gasoline taxes has been multiplied by 2.5 to get a figure of $1.25 per kilogram of hydrogen for taxes.

2.  The cost estimates assume mass production.

3.  All subsidies were taken out.

For example, the cost of wind power used below in the wind-to-hydrogen estimate is around 7 cents per kilowatt hour (which multiplied by the approximately 50 kilowatt hours of electricity needed to produce a kilogram of hydrogen via electrolysis would equal $3.50 for the energy costs).

This is an unsubsidized cost figure for electricity produced at large wind farms.

4.  As a point of reference, hydrogen (likely from natural gas) sold for $8.18 per kilogram at the Washington, D.C. Benning Road Shell fueling station in September 2008.  Moreover, hydrogen produced from hydroelectric power sold for $6.28 per kilogram in Norway back in May.

5.  There is absolutely no way of knowing what the exact cost of hydrogen would be right now in the scenarios below if millions of hydrogen fuel cell cars were on the road.  The estimates below are educated guesses based on what I have learned over the past five years.

Estimated cost of hydrogen per kilogram in a variety of scenarios

With all of this in mind, here are the cost estimates per kilogram (which each include $1.25 for taxes):

Hydrogen from natural gas (produced via steam reforming at fueling station)

$4 – $5 per kilogram of hydrogen

Hydrogen from natural gas (produced via steam reforming off-site and delivered by truck)

$6 – $8 per kilogram of hydrogen

Hydrogen from wind (via electrolysis)

$8 – $10 per kilogram of hydrogen

Hydrogen from nuclear (via electrolysis)

$7.50 – $9.50 per kilogram of hydrogen

Hydrogen from nuclear (via thermochemical cycles – assuming the technology works on a large scale)

$6.50 – $8.50 per kilogram of hydrogen

Hydrogen from solar (via electrolysis)

$10 – $12 per kilogram of hydrogen

Hydrogen from solar (via thermochemical cycles – assuming the technology works on a large scale)

$7.50 – $9.50 per kilogram of hydrogen

As mentioned above, a cost of hydrogen of $4 to $12 per kilogram is equivalent to gasoline at $1.60 to $4.80 per gallon.

[Photo credit: basykes]

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