Globally, hydrogen production costs are declining faster than erstwhile thought
RENEWABLE H2 COST COULD BE SEEN BREAK EVEN WITH GRAY H2 BEFORE 2030 IN OPTIMAL REGIONS
Three factors are driving this acceleration. First, capex requirements are dropping. We expect a significant electrolyzer capex decline by 2030 – to about USD 200-250/kW at the system-level (including electrolyzer stack, voltage supply and rectifier, drying/purification and compression to 30 bar).
That is 30-50% lower than we anticipated last year, due to accelerated cost roadmaps and a faster scale-up of electrolyzer supply chains. For example, several electrolyzer manufacturers have announced near-term capacity scale-ups for a combined total of over approximately 3 GW per year.
Electrolyzer capex savings can reduce costs quickly in a rapid global scale up
Including carbon costs emissions related to gray and low-carbon hydrogen production greatly influences the breakeven dynamics between gray and renewable hydrogen. Assuming a carbon cost of about USD 50 per ton of CO2e by 2030, USD 150 per ton CO2e by 2040, and USD 300 per ton CO2e by 2050, can bring the earliest breakeven for renewable hydrogen forward to a 2028 to 2034 timeframe. The exact year will depend on the availability of local resources.