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Article

Technical–Economic Analysis of Renewable Hydrogen Production from Solar Photovoltaic and Hydro Synergy in a Pilot Plant in Brazil

by
Ana Beatriz Barros Souza Riedel
1,*,
Vitor Feitosa Riedel
1,
Hélio Nunes de Souza Filho
1,
Ennio Peres da Silva
2,
Renato Marques Cabral
3,
Leandro de Brito Silva
3 and
Alexandre de Castro Pereira
3
1
School of Mechanical Engineering, University of Campinas, Campinas 13083-970, Brazil
2
Interdisciplinary Center for Energy Planning, University of Campinas, Campinas 13083-970, Brazil
3
Eletrobras, E-Fuel Management (CMNSC), Goiânia 74993-600, Brazil
*
Author to whom correspondence should be addressed.
Energies 2024, 17(17), 4521; https://doi.org/10.3390/en17174521
Submission received: 14 July 2024 / Revised: 19 August 2024 / Accepted: 26 August 2024 / Published: 9 September 2024
(This article belongs to the Section B: Energy and Environment)
Browse Figures
Figure 1
<p>Installed capacity by source. Source: prepared by the authors with data from [<a href="#B18-energies-17-04521" class="html-bibr">18</a>].</p> "> Figure 2
<p>Renewable hydrogen plant in the Itumbiara Hydropower Plant. Source: Research Archive (2023).</p> "> Figure 3
<p>Control volume for this work. Source: Prepared by the authors (2023).</p> "> Figure 4
<p>Share of each electricity source in the plant. PPP stands for photovoltaic plant production, HPP for hydroelectric plant production. Source: prepared by the authors.</p> "> Figure 5
<p>Solar irradiation hourly distribution profile from solarimetric station data.</p> "> Figure 6
<p>Plant’s OPEX during its useful life. Source: prepared by the authors.</p> "> Figure 7
<p>Electricity cost per year. Source: prepared by the authors.</p> "> Figure 8
<p>Impact of selected parameters on the LCOH. Source: prepared by the authors.</p> ">
Versions Notes

Abstract

:
Renewable hydrogen obtained from renewable energy sources, especially when produced through water electrolysis, is gaining attention as a promising energy vector to deal with the challenges of climate change and the intermittent nature of renewable energy sources. In this context, this work analyzes a pilot plant that uses this technology, installed in the Itumbiara Hydropower Plant located between the states of Goiás and Minas Gerais, Brazil, from technical and economic perspectives. The plant utilizes an alkaline electrolyzer synergistically powered by solar photovoltaic and hydro sources. Cost data for 2019, when the equipment was purchased, and 2020–2023, when the plant began continuous operation, are considered. The economic analysis includes annualized capital, maintenance, and variable costs, which determines the levelized cost of hydrogen (LCOH). The results obtained for the pilot plant’s LCOH were USD 13.00 per kilogram of H2, with an efficiency loss of 2.65% for the two-year period. Sensitivity analysis identified the capacity factor (CF) as the main determinant of the LCOH. Even though the analysis specifically applies to the Itumbiara Hydropower Plant, the CF can be extrapolated to larger plants as it directly influences hydrogen production regardless of plant size or capacity.

1. Introduction

In order to ensure that the global community reaches the objectives of the Paris Agreement to keep biosphere warming below 2 °C, while making further efforts to limit it to 1.5 °C, it has been recognized that the speed and scale at which renewable energy and efficiency measures are deployed must increase significantly between now and 2030. This can be expected to boost the global movement towards making energy systems free from fossil fuels, with no carbon capture, well before the mid-century mark [1,2]. The intensification of global efforts to tackle climate change, as well as the acceleration of the sustainable economy in the wake of the COVID-19 pandemic and global crises, is contributing to the advancement of sustainable technologies [3,4].
In this context, renewable hydrogen obtained through the use of renewable energy sources—notably, water electrolysis—has gathered significant attention as a promising energy vector to deal with the challenges of climate change and the intermittency of renewable sources. Its application spans various sectors, such as transportation, electricity storage, and industrial processes, making it a versatile and appealing energy carrier, contributing to the reliability and security of the energy system [5,6].
As the share of renewable sources, such as solar photovoltaic (PV) and wind, increases in the electrical sector, new challenges associated with their intermittent nature have arisen. This is manifested not only as low availability in high-demand periods but also as great potential when demand is lower. In the latter case, electrolyzers can be used to produce hydrogen and oxygen, providing a viable solution. At present, it is necessary to shut down renewable electricity generation, and the growing participation of these sources tends to further increase these events [7].
The use of hydrogen as a means of storing renewable electricity has the advantage of relying only on the availability of electricity and water. Through consuming electricity, it is possible to break the water molecule down into its constituents, which are hydrogen and oxygen. From the mass balance in the chemical reaction formula for water breakdown, it is possible to determine that, for each 0.80 L of water, 1 Nm3 (normal cubic meter) of hydrogen is obtained, equivalent to 89.87 g. This water consumption follows the stoichiometric relationship, but, in practice, this consumption is higher and varies according to the electrolysis technology used [8].
In the electrolysis process, an electrolyzer is employed to generate hydrogen, which is stored in a local reservoir. Then, an electricity generator can be fueled by this hydrogen. Examples of this kind of generators are fuel cells and generator sets [9].
In recent years, several countries around the world have implemented ambitious initiatives to develop green hydrogen as a sustainable solution to decarbonize carbon-intensive sectors and accelerate the energy transition.
In the European Union, in November 2022, a EUR 3 billion (~USD 3.2 billion) call was launched to support large-scale projects focused on innovative technologies, including hydrogen. Following the success of the Important Projects of Common European Interest (IPCEI), the second IPCEI “Hy2Use” was approved in September 2022, with EUR 5.2 billion (~USD 5.5 billion) allocated to 35 projects focused on the production, storage, transportation, and use of renewable hydrogen in innovative industrial applications [10].
In Germany, in 2023 the European Commission approved a direct subsidy of EUR 550 million (~USD 579 million) and a conditional payment mechanism of up to EUR 1.45 billion (~USD 1.53 billion) to support ThyssenKrupp Steel Europe in decarbonizing its steel production and accelerating the use of renewable hydrogen [10].
In Spain, the government has expanded funding for the Strategic Project for Economic Recovery and Transformation in Renewable Energy, Hydrogen, and Storage in June 2023, with an increase of nearly EUR 5.5 billion (~USD 5.8 billion) in the Recovery and Resilience Plan [10,11].
Australia launched its National Hydrogen Strategy in November 2019, a framework that includes 57 nationally coordinated actions to develop the country’s hydrogen industry. The 2023–2024 federal budget allocated AUD 2 billion (~USD 1.4 billion) to the Hydrogen Headstart program, aimed at supporting large-scale renewable hydrogen projects [10,11].
In Japan, NEDO committed JPY 220 billion (~USD 1.7 billion) in 2023 for the next phase of a liquefied hydrogen supply chain project between Australia and Japan [10].
Chile plans to become the largest exporter of low-cost green hydrogen by 2040, leveraging the country’s solar and wind potential. The Chilean government is amending regulations to include hydrogen as an energy carrier and ensure security throughout its value chain. Production is expected to reach up to 1.6 million tons of green hydrogen per year, with a local market valued at around USD 33 billion, including USD 24 billion in exports [10,11].
In Brazil, with a predominantly renewable electricity matrix, the domestic energy supply reached 313.9 Mtoe in 2023, an increase of 3.5% compared to the previous year. In the case of electricity, renewable sources represented 89.2% of the electricity matrix, standing out for the use of hydraulic energy, the growth of wind and solar photovoltaic generation, and a reduction in the use of thermoelectric plants powered by fossil fuels [12].
This context is extremely favorable for the development of the hydrogen value chain in the country. The creation of “Renewable Hydrogen Hubs” is gaining momentum, with the development of pilot projects being seen in several regions of the country, and, now, new initiatives will be driven by Law 14,948, approved in August 2024. This law regulates the production of low-carbon hydrogen and establishes a voluntary certification system, defining that hydrogen will be considered low-emission if, throughout its life cycle, emissions are equal to or less than 7 kgCO2eq/kgH2 [13].
In addition to the ongoing initiatives with established legislation and allocated resources, numerous studies in various countries have been exploring the potential of renewable hydrogen production through water electrolysis [5,9,14,15]. These studies help to guide decision-makers in fostering further initiatives around hydrogen technology. However, research gaps still persist in several areas, some of which are addressed in this work, with a particular focus on the local context of Brazil.
Most studies have focused on direct comparisons between Europe, the United States, some Asian countries, and the Middle East regarding their renewable hydrogen production potential via solar PV and wind [5,16,17,18,19]. In Brazil, studies have focused on theoretical potentials, and case studies of operating plants are still scarce. This work fills this gap, presenting a technical analysis based on operational data for the years 2021 and 2023. Additionally, an economic analysis is carried out, with equipment investment cost from 2019 for the hydrogen pilot plant located in the Itumbiara Hydroelectric Plant, between the cities of Itumbiara (Goiás) and Araporã (Minas Gerais), Brazil, being taken into consideration.
Furthermore, most studies have not integrated both technical and economic factors in their analysis in a holistic manner. For example, many have not included operating (OPEX) and maintenance costs, which can significantly influence the viability of large-scale hydrogen production. This work also considers the capacity factor, along with economic factors, thus offering a broader and deeper understanding of hydrogen production in the chosen region.
Therefore, the research presented here contributes to the body of existing knowledge, filling some of these mentioned gaps, and ultimately aims to help in the decision-making process for other, larger-scale enterprises in different technical and economic contexts.
This research consisted of an analysis of the technical and economic benefits associated with the combined use of solar PV and hydro sources to produce renewable hydrogen. The metric used for this analysis was the levelized cost of hydrogen (LCOH) in USD/kg. This concept is widely applied for electricity production and refers to the cost to produce one unit of hydrogen. It includes capital and operating costs during the enterprise’s useful life, considering the time value of money [20].
The novelty of this work consists of the following aspects:
-
Geographical focus: This is one of the first studies using real operational data for a pilot plant producing renewable hydrogen in Brazil. It is a small-scale plant, developed within the research and development (R&D) project (PD 00394-1606/2016) of the 21st strategic call from the National Electrical Energy Agency (ANEEL, in Portuguese), that can help in decision-making regarding larger-scale enterprises. This analysis sheds some light on the many challenges and opportunities in this region, contributing in this way to the understanding of hydrogen in the national landscape as well as future renewable hydrogen initiatives.
-
Synergy between energy sources: Even though some studies have investigated solar PV or wind individually for renewable hydrogen production, this work combines solar PV with hydro—two renewable sources with great participation in the Brazilian electricity matrix—in line with the emerging concept of hybrid renewable energy systems. This approach acknowledges the intermittent nature of these sources, which is greater for solar PV than hydro, and maximizes the reliability of energy supply to produce hydrogen.
-
Economic analysis: This work investigates economic factors which influence renewable hydrogen production in the selected region. This allows for greater insight in regard to cost allocation, from renewable energy costs to investment and labor. These insights are valuable for policymakers and investors in terms of comprehending the economic viability of renewable hydrogen production both in the selected region (between the states of Goiás and Minas Gerais) and in Brazil in general.
Reinforcing the innovation and originality of this study and the pilot plant, in November 2023 the Brazilian Electricity Commercialization Chamber (CCEE)—in accordance with European guidelines and standards for the certification of hydrogen from renewable energy sources—issued the first certificate in Brazil for the production of renewable hydrogen by Eletrobras at the Itumbiara plant in Goiás [21]. This milestone underscores the originality of this project and article, as it analyzes the levelized cost of hydrogen (LCOH) for a real, operational, and certified renewable hydrogen production plant.
For this work, the most recent literature—both scientific and technical reports—was consulted, along with real operating data gathered by the authors for the period 2019–2023 regarding the renewable hydrogen plant within the Itumbiara Hydropower Plant.

2. Brazilian Electricity Matrix

The Brazilian electrical matrix is predominantly represented by renewable sources, with hydropower being the most important. In 2022, about 64% of its internal electricity supply was from this source, even though this number was reduced to 54% in April 2024 [22,23]. In 2022, the total electricity generation installed capacity, shown in Figure 1, reached 189.13 GW, reflecting a 7.52 GW increase compared to the previous year. The contributions of wind and solar increased by 14.3% and 82.4%, reaching 23.74 GW and 24.45 GW of installed capacity, respectively. This accelerated growth explains the reduction in the share of hydropower.
The National Electric System Operator (ONS, in Portuguese) is “the body responsible for coordinating and controlling the operation of electricity generation and transmission facilities in the National Interconnected System (SIN, in Portuguese) and for planning the operation of isolated systems in the country” [17,24].
The energy production and transmission system in Brazil is a large-scale thermal–wind–solar enterprise that is predominated by hydropower plants and has multiple owners. The SIN is subdivided into the following four subsystems: South, Southeast/Center-West, Northeast, and the greater part of the North [24]. The integrated nature of this system, through a mesh of transmission lines, allows for the transfer of electricity between subsystems, and thus synergistic gains can be considered to explore the diversity between the hydrological regimes of the basins.
The ONS expects the installed capacity to increase to 254.226 GW in 2028, with greater participation of distributed generation, wind, and solar PV, reaching shares of 16.7%, 13.7%, and 8.0%, respectively. These sources, which would represent 38.4% of the combined electrical matrix in 2028, are all intermittent (i.e., are not available for the whole day), thus bringing new challenges to the sector [24].
As the share of these sources increases, the need for technologies to store the potential renewable energy grows. This can be achieved by hydropower reservoirs and/or new technologies which allow for the storage of great amounts of electricity. These technologies can be divided into many categories, such as direct electricity storage (supercapacitors, superconductor magnets), mechanical storage (reversible hydropower plants, flywheels, gravity batteries, and compressed air), electrochemical storage (electrochemical batteries), and chemical storage (hydrogen) [25].
Within the scope of these technologies, this work focuses on the application of hydrogen in the electricity sector. In this context, hydrogen fundamentally serves as a means of storing electricity. Through exploring this specific application, we seek not only to better comprehend its benefits and challenges but also to examine the ways in which hydrogen can play a crucial role in the evolution and optimization of the electrical system, promoting both sustainability and operational efficiency.

3. Hydrogen Production in Brazil

Hydrogen production in Brazil comes mainly from natural gas steam reforming, with no CO2 capture or storage; thus, it is classified as non-renewable. This hydrogen is mostly used in the petrochemical sector for the hydrotreatment of gasoline, diesel, and lubricants to ensure their quality. Another H2 production route in this sector is as a subproduct in catalytic reforming (i.e., catalytic hydrocracking), with the main purpose being increasing octane in naphtha chains intended for gasoline production [26].
Refineries are the main H2 users, responsible for about 74% of industrial consumption. This not only due to the increasing demand for oil derivatives derived from hydrotreatment but also due to the tightening of environmental regulations, as well as the more recent inclusion of vegetable oils in the refining process [27].
However, renewable hydrogen production is gathering interest, and companies and public–private partnerships are fostering the development of this sector. In Brazil, the first initiatives began in 1975, with the creation of the Hydrogen Laboratory (LH2) in the State University of Campinas (São Paulo) [28]. Since then, despite alternating periods of intense development and innovation followed by decreased research, many actions have been carried out through the years with the aim of boosting the technological development for hydrogen production in the country. The National Hydrogen Program (PNH2) and the Hydrogen Three-Year Plan were introduced in 2022 and 2023 in order to plan and organize activities to develop the hydrogen economy in Brazil [29].
Table 1 lists projects relevant to the context of this study which have focused exclusively on the electrical sector, ranging from electricity storage to new applications within it.
Among the mentioned projects, this work focuses on Eletrobras’ storage of electricity via hydrogen at the facility installed in the Itumbiara Hydropower Plant.

4. Methods

This section describes the procedures for the technical and economic analysis of renewable hydrogen production, harnessing the synergies between solar PV and hydropower, and considering a pilot plant in Brazil.

4.1. Technical Analysis Modeling

To calculate the performance of an electrolysis system, the electrolyzer efficiency ( η E l e c t r o l y s e r ) needs to be obtained. This efficiency is the ratio between the electricity consumption by the equipment and the chemical energy of the hydrogen produced. In this calculation, the Higher Heating Value (HHV) is used to represent the total energy in a unit mass of gas. The real efficiency can be determined from the specific consumption, as described in Equation (1) [9]:
η E l e c t r o l y s e r = H H V × M H 2 E E × 100 % ,
where
H H V is the Higher Heating Value in k W h . k g − 1 ;
M H 2 is the hydrogen production, in kg, obtained from data measured in tests;
E E is the electrolyzer energy consumption, in kWh, measured during tests.
During tests, electricity consumption was measured and hydrogen production was calculated from the volume of gas produced (V, in m3), pressure (P, in Pa), temperature (T, in K), and the compressibility factor (Z) of the gas under these conditions [36]. With these parameters, the real mass of H2 produced in each test can be calculated using Equation (2), as follows:
M H 2 = P × V × 2.016 × 10 − 3 8.314462 × T × Z .
By dividing the electricity consumed by the electrolyzer by the mass of hydrogen produced, the electrolyzer’s specific consumption ( q ˙ ) is obtained, as in Equation (3), for each test:
q ˙ = E E M H 2 .
By substituting Equation (3) into Equation (1), the electrolyzer efficiency is obtained, according to Equation (4):
η E l e c t r o l y z e r = H H V q ˙ × 100 % .

4.2. Economic Analysis Modeling

  • Renewable hydrogen cost, usually referred to as the LCOH, is a function of the following factors [37,38]:
  • CAPEX, which depends on all initial investment costs;
  • The weighted average cost of capital;
  • The capacity factor, where, the longer the electrolyzer is in use, the more distributed the CAPEX component is;
  • The operational expenditure (OPEX), which is also classified as one of the main cost components. While electricity cost can be considered part of the OPEX, as this cost is particularly significant, it is usually presented separately.
Thus, in this work, OPEX does not include electricity costs but includes water and system maintenance costs. Water and water treatment costs are classified as secondary costs. According to [39], water treatment consists of water storage, pumping, and the production of distilled deionized water.
In this context, some studies have pointed out that, by 2030, the LCOH is expected to reach about USD 1.54 per kg, divided into electricity (USD 0.90 per kg), CAPEX (USD 0.27 per kg), water (USD 0.22 per kg), and OPEX (USD 0.14 per kg). Most of the cost reduction is attributed to the decrease in CAPEX, driven by a combination of technological innovation and economies of scale, as electrolyzer production intensifies. OPEX will also decrease due to improved operational efficiency [40].
The report published by [37] suggests that, with electrolyzer cost reductions, along with greater reductions in renewable electricity costs, low-carbon hydrogen could become competitive vis-à-vis fossil-based hydrogen by the second half of this decade in places where renewable resources are favorable.
The method proposed in this work enables an economic analysis of hydrogen production. The annual hydrogen production capacity via electrolysis, P H 2 R   k g H 2 y e a r , is obtained using Equation (5), which considers the capacity factor (CF, in %); hourly production measured in tests; M H 2 h o u r , in k g H 2 h o u r ; and the quantity of hours in a year.
P H 2 R = C F × M H 2 h o u r × 8760 h o u r s y e a r
CAPEX, according to [41], is considered the unitary cost of hydrogen, in U S D k g H 2 . This value is obtained with Equation (6), in which CA U S D y e a r represents the annualized investment cost necessary to produce hydrogen, considering the equipment’s useful life and discount rate, among other factors, divided by annual production ( P H 2 R ) , described above in Equation (5).
C A P E X = C A P H 2 R
The total electricity cost ( C E T ) in U S D k g H 2 is obtained using Equation (7), which relates electricity prices ( C E E ), in U S D M W h , obtained from solar PV auction prices in 2019, with the total electricity consumption in a year ( C T E ), in M W h y e a r , the plant’s capacity factor (CF), and the total hydrogen production ( P H 2 R ) .
C E T = C E E × C T E × C F P H 2 R
OPEX are the other costs associated with the enterprise, which are related to labor, component maintenance, and other expenditures. In this work, OPEX represents real costs for the pilot plant operation, as in Equation (8).
O P E X = A n n u a l O P E X P H 2 R
The LCOH, presented in Equation (9), relates all costs, i.e., CAPEX, OPEX, and C E T .
L C O H = C A P E X + O P E X + C E T

5. Case Study

The renewable hydrogen plant, which produces hydrogen through synergy between solar and hydro sources, is located within the Itumbiara Hydropower Plant, at a latitude of 18.4163° N and longitude of 49.1119° E. It is an Eletrobras enterprise and was commissioned within the scope of an R&D project, the ANEEL Strategic Call n° 21/2016 [42].
The Itumbiara Hydropower Plant is owned by Eletrobras, which is the largest electricity generation company in Brazil, with about 23% of the country’s electricity generation capacity. About 97% of its installed capacity is from low-emission sources. The company leads in electricity transmission, owning 38.49% of the transmission lines in the SIN [43].
The Itumbiara Hydropower Plant, located in the Paranaiba River, at the state border between Goiás and Minas Gerais, has six operating units, with 347 MW nominal power per unit, for a total 2082 MW of installed capacity, being of great importance for the SIN [44]. Figure 2 presents the renewable hydrogen storage plant.
Besides using the reservoir system to deal with annual seasonality, solar PV intermittencies are compensated by hydrogen storage and batteries, the former being for the medium term (months) and the latter for the short term (minutes, hours, or a few days) [45].
This joint operation of two primary energy sources allows for a better utilization of both, resulting in greater efficiency for the whole, with potential benefits for system reliability, lowering both the risk of hydrological deficit and the electricity generation cost. Furthermore, there are environmental benefits as it displaces thermoelectric sources, thus reducing fossil fuel consumption. Among the benefits of using solar PV along with hydroelectricity plants is the shared use of existing infrastructures, such as substations and transmission lines, to transmit the electricity produced [45]. The following sections describe the data used in this study.

5.1. Data Sources

The 800 kWp solar PV plant installed in the Itumbiara Hydropower Plant has 2052 panels and eight inverters. The panels were installed with an inclination of 14° in relation to the horizontal plane and zero azimuth angle. The panels were made by Trina Solar, model DE14H, with 390 Wp each, 19.7% efficiency, and monocrystalline cells, according to the manufacturer’s data. The frequency inverters are made by SMA with 75 kW and 380 V [45].
The electricity storage plant has an EPE-precision solarimetric station for parks of up to 100 MW.
The Hydrogen Energy Storage System uses hydrogen to store electricity and is composed of the following three pieces of equipment: an electrolyzer with alkaline technology and a maximum capacity of 51 Nm3/h at 27.5 barg of hydrogen production, provided by Accelera Zero (by Cummings, ex Hydrogenics); a pressurized reservoir with 30 m3 of physical volume and maximum operating pressure of 27.5 barg (equivalent to 825 Nm3 of hydrogen storage capacity), provided by the Brazilian company Nitrotec; and a fuel cell assembly capable of generating 300 kW of electricity, supplied by Accelera Zero.
As the objective of this work is to perform a technical and economic analysis of the hydrogen production and storage system, harnessing the synergy between solar PV and hydro sources, data for the fuel cell and batteries arranged in the electricity storage plant were not considered. Thus, for the plant’s control volume, the input energy is the electricity consumed by the electrolyzer and the energy produced is the hydrogen, as illustrated in Figure 3. As discussed in Section 4.2, the electricity costs already consider the total energy consumption by the plant, also including electricity for pumping water. Land cost was not considered, as the plant is installed in an area already available within the confines of the hydropower plant. On the other hand, additional benefits, such as the oxygen produced by electrolysis, were also not considered.

5.2. Parameters and Premises Used for the Analysis

For the energy balance in maximum hydrogen production conditions, the maximum hours that an electrolyzer can operate during a year must be considered, harnessing the synergy between the hydropower source from the grid and the solar PV plant. From this value, electricity consumption and hydrogen production by the electrolyzer can be quantified. In this regard, it was considered that the electrolyzer was in operation for 7884 h for the maximum hydrogen production case, using a capacity factor of 90%. For calculation of the hydrogen cost, its final use was not considered; as such, the only components in the analysis were the electrolyzer, piping, and reservoir.
It is important to highlight that data for the electrolyzer were collected at the beginning of operations, after installation and commissioning in 2021, and during continuous operations in the year 2023. This was performed to calculate the yearly efficiency loss of the system.
Table 2, Table 3 and Table 4 summarize the technical specifications for the equipment used in this study. These data were collected from the manufacturers’ datasheets. Calculations were carried out according to the solarimetric base installed in the plant and hydrogen plant operating reports.
For the economic analysis, investment costs for the production and storage of hydrogen (CAPEX) were obtained from data disclosed in the pilot project report. The values used in this work were those from 2019, the year when the equipment was purchased, with a 3.92 BLR–USD exchange rate. The investment costs are listed in Table 5.
The operating and maintenance expense (OPEX) is the cost required to keep the equipment operating. It considers labor costs, corrective and preventive maintenance, as well as consumables in the electrolyzer operating process, such as gasses, for sensor calibration, process purging, miscellaneous filters, tools, and equipment. For this work, a real value of USD 168,280.71 was used for a year of operation and the activities described above, as shown in Table 6.
To calculate costs for the electricity obtained through solar PV and hydro sources to generate the electrolytic hydrogen, values were obtained from the generation auctions in the Regulated Environment A-6, year 2019, from the ANEEL, as shown in Table 7 [46]. It is important to highlight that, in Brazil, electricity generation auctions are conducted by ANEEL, who are responsible for regulating and supervising the sector.
In this study, the solar PV source is predominantly used, complemented by hydro when the former is unavailable. This is carried out to guarantee a 24 h supply of electricity, allowing for the maximum operation of the electrolysis system.

6. Discussion

This section presents the results with the objective of analyzing the technical and economic benefits of the combined use of solar PV and hydro sources to produce renewable hydrogen. Initially, an energy balance for the renewable hydrogen plant was obtained, identifying the consumption of each energy source (solar PV and hydro) by the electrolyzer.
Figure 4 illustrates the solar PV generation profile in the Itumbiara Hydropower Plant, where part of the solar PV electricity generated is consumed by the electrolyzer and part is injected into the grid. The hydro source is used in periods of solar PV unavailability. In this work, solarimetric data were used for the simulation due to their greater statistical precision, allowing for annual averages to be obtained. The data collected from the solar panels were insufficient for the analysis, as there were missing data for some periods, which would compromise its precision.
As presented in Section 5, one of the renewable energy sources in this pilot project is solar radiation, which is converted into electricity in the 800 kWp PV plant. Figure 5 shows the irradiation profile (I) inside the PV plant area of the Itumbiara Hydropower Plant. These data were collected from the solarimetric plant for the year 2020, with I a v e r a g e equal to 5.65 kWh.m2day.
The solarimetric station provides detailed data for solar irradiance, which is essential for analysis of solar PV generation potential. However, generation curves for the solar PV panels were not available, resulting in a discrepancy between the solarimetric data and real data from the panels. This displacement of anticipated peak generation can be related to many factors, such as panel efficiency and specific operating conditions.
According to the PV panels’ installed capacity and the calculated average irradiance, we obtained an average solar generation of 4428.92 kWh/day.
Using the obtained values for the electrolyzer nominal consumption, solar PV plant installed capacity, and the hydropower supply for the electrolyzer when the solar potential was not available, hydrogen production was calculated using Equation (3) (in kilograms per day). The daily operation technical analysis results are described in Table 8.
It is worth noting that the solar PV plant generation was not totally used by the electrolyzer due to its power (800 kWp) being greater than the electrolyzer’s nominal consumption in the period around noon. This excess electricity generation from the solar PV plant was 1788.98 kWh, which was supplied to the grid. The share of solar PV in hydrogen production was 40.58%, while that of hydro was 59.42%.
Using a 90% capacity factor, as presented in Table 3, with data from Table 8, it was possible to obtain data for hydrogen production (using Equation (3)) and the annual electricity consumption, as detailed in Table 9.
To identify the loss of useful life in the electrolyzer system, efficiencies were calculated for the beginning of operations in 2021 ( η E l e c t r o l y z e r i ) and for continuous operations in 2023 ( η E l e c t r o l y z e r o p ). The efficiency for the hydrogen reservoir was not calculated as it only stores and releases the hydrogen according to electrolyzer production or hydrogen demand in certain processes. As such, it does not consume hydrogen or electricity during its operation. Therefore, using Equation (4) from Section 4.1, the efficiencies were obtained, as detailed in Table 10.
The results indicate the electrolyzer system’s performance over a period of two years and one month. Total efficiency loss was 2.65%, thus indicating an annual loss of 1.27%.
For the economic analysis, the LCOH calculation was based on data presented in Table 5, Table 6 and Table 7, including CAPEX, OPEX, and electricity costs. A discount rate of 7% per year was used to obtain the present values for these costs.
Furthermore, the premise of substituting the electrolyzer stack—the component responsible for water electrolysis—every 10 years was also considered. This information was obtained from the equipment manufacturer, with the cost shown in Table 6.
The investment cost for the hydrogen production and storage system, also known as CAPEX, includes the cost of equipment acquisition, engineering, installation, and commissioning of the plant. The values presented in this study were those from 2019—the year when the equipment was purchased—presented in Table 5. These data were obtained from reports made available by the company that owns the pilot plant and represents real project costs, including those related to piping, electrical connection, engineering, installation, and commissioning.
From these data, it is possible to confirm that the total CAPEX for the hydrogen production and storage system was USD 2,103,508.86. Using Equation (6), it is possible to obtain a value of USD 5.51/kgH2 for the unitary CAPEX cost.
The OPEX was calculated based on the operator’s labor costs, corrective and preventive maintenance, consumables in the electrolyzer operating process, electrolyzer stack replacement in the 10th operating year, and annual hydrogen production of the plant, reaching a value of USD 5.44/kg H2 using Equation (8). The OPEX for the plant during its useful life is presented in Figure 6.
To obtain the specific cost of electricity ( C E E ) , the shares of each electricity source were used along with costs according to the Energy Auction A-6 from the ANEEL, presented in Table 7. Thus, C E E was found to be equal to USD 32.55/MWh.
To obtain the total electricity cost ( C E T ) , a specific electricity cost of USD 32.55/MWh, a total electricity consumption of 2136.82 MWh/year by the electrolyzer, and a 90% capacity factor were used. Using Equation (7), the electricity cost per unit of hydrogen was found to be equal to USD 2.04/kgH2. Figure 7 presents the hydrogen plant electricity consumption, considering an efficiency loss of 1.27% per year.
As shown in Figure 7, the electricity cost increased due to the annual efficiency loss of the electrolyzer. In year 10, with a stack replacement (and, thus, increased efficiency), the system can operate for 10 more years, reaching the estimated end of the electrolysis plant’s useful life.
To summarize, Table 11 presents the costs for the production and storage of renewable hydrogen in the Itumbiara Hydropower Plant.
From these data, it was possible to obtain the LCOH of USD 13.00/kgH2 for the pilot plant using Equation (9). This LCOH for the Itumbiara Hydropower Plant is higher than those reported in other studies. There are three main reasons for this, as follows: first, this work is based on a pilot plant with a low production capacity; second, real-world data were used, not those from cost projections, as found in reviews of the literature; third, the LCOH was calculated without considering subsidies or financial incentives, which points to the competitive position of Brazil in this market. The analysis shows that the plant scale, capacity factor, and electricity cost in the region where the plant is located have significant impacts on the LCOH.
A previous report [47] showed that, even in only considering wind and solar PV potentials, Brazil will be capable of reaching very competitive values for renewable hydrogen by 2030. The LCOH values for Brazil in 2030 have been predicted to range from USD 2.7 to 5.6/kg of H2 depending on the region, resource availability, and storage costs. The South and Northeast regions have the most competitive LCOHs in the country, with the South benefiting from more constant winds, which reduces the need for hydrogen storage. In projections for 2050, values from USD 1 to 1.35 per kg of H2 are expected to be reached [48].
Scenario analyses presented in other studies and countries point to very different values. In [49], the LCOH for green hydrogen can be reduced by 49%, from USD 6.1/kg to USD 3.1/kg, through scaling a solar PV plant from 10 MW to 1 GW and by 36%, from USD 5.8/kg to USD 3.7/kg, when considering a wind power plant similarly.
Results from another study [50] indicated that Chile has the potential to produce green hydrogen at the lowest cost, projected at USD 2.8–4.5/kg by 2030. In Morocco, the LCOH is expected to range between USD 3.2 and USD 3.5/kg; in Australia, between USD 3.2 and USD 3.6/kg; and, in Colombia, from USD 4.1 to USD 4.9/kg by 2030. Simulations show that the LCOH is more sensitive to specific investment costs and electrolyzer utilization rates regardless of the country or scenario examined [39].
The study in [51] presented renewable hydrogen production projections for 30 European countries. The analysis showed that the LCOH values for renewable hydrogen production systems cover an ample range of values, starting from USD 2.3 up to USD 16.7 per kilogram in 2020, being reduced from USD 1.8 up to USD 9.9 per kilogram by 2050. The authors identified that the renewable hydrogen production costs differ with different technologies, locations, and points in time. In almost all countries, hybrid systems based on a combination of solar PV energy and onshore wind result in the lowest LCOH. For these systems, the LCOH can reduced to less than USD 2.6/kg by 2050 in 90% of countries.
In [41], a study published in 2020, the impact of incorporating electricity from the grid into renewable hydrogen production was investigated, aiming to increase the usage rate and supply of hydrogen in the North and South regions of Chile. The LCOH for PEM technology varies from USD 5.79/kg to USD 6.89/kg when using solar PV and from USD 5.60/kg to USD 5.97/kg when using wind power, depending on the proportion of grid electricity used.
Thus, it is important to highlight that, even though the LCOH was found to be slightly higher for the electrolytic hydrogen produced through the synergy of solar PV and hydropower in a small plant, Brazil has significant potential in regard to implementing electrolysis systems which are capable of producing large quantities of hydrogen. In contrast, previous research works have explored the costs associated with the production of hydrogen using only a single source, such as solar PV or wind. However, these studies did not analyze or compare the LCOH for both technologies in a specific location, as delineated in the hydrogen strategy in Brazil. When added to these factors, this obtained value provides a simplified reference for decision-makers who aim to install new facilities at a larger scale.

Sensitivity Analysis

To better understand the influence of parameters in the LCOH calculation, a sensitivity analysis was carried out. As such, five parameters were selected for analysis.
  • Electricity cost: this was varied by ±20% over the specific electricity cost previously obtained;
  • CAPEX: analogous with electricity cost, CAPEX was varied by ±20% over the value previously presented in this study;
  • OPEX: also varied by ±20% over the value presented above;
  • Solar PV share: the criteria for solar PV participation was that the electricity consumption has to be simultaneous with generation, and so its participation can vary between 0 and 54.2% due to the local distribution of solar irradiance, as illustrated in Figure 4;
  • Capacity Factor: as with the other parameters, it was reduced by 20% for the minimum value, but the maximum value was capped at 100% due to the nature of the parameter, thus representing a 11% increase over the baseline value of 90% used in this study.
  • The results of the sensitivity analysis are summarized in Figure 8.
Based on this analysis, the capacity factor is the main determinant of the LCOH. This occurs because any reduction in productivity increases costs, while an increase in productivity has the opposite effect. In the analysis, if the electrolyzer can be operated at its nominal capacity for the full number of available hours, the LCOH can be reduced by USD 1.10 per kilogram. Conversely, if the operating hours are decreased by 20%, the LCOH would increase by USD 2.74 per kilogram. Additionally, if the CAPEX were 20% higher, the LCOH would increase by USD 1.10 per kilogram. This demonstrates that the capacity factor is the most critical element influencing the LCOH in this particular plant, highlighting its sensitivity to the number of operational hours and the efficiency of the electrolyzer.
CAPEX and electricity cost impacts are direct and proportional; as these costs increase, so does the hydrogen cost, in a linear form. For OPEX, a lower cost results in a lower hydrogen cost while a higher OPEX incurs a higher H2 cost.
Solar PV participation has a positive impact on the cost of hydrogen, as the electricity generated by this source is cheaper than that from hydro. However, it is important to consider the instant generation and demand criterion, limiting it to 54.2% due to availability restrictions in the plant’s location. To guarantee a higher capacity factor—which is the most important LCOH parameter—the use of hydro source is needed, as it is a flexible renewable source that ensures an uninterrupted supply of high-quality electricity for hydrogen production. This is not possible when using only solar PV.
It is important to highlight that this analysis was only applied to the Itumbiara Hydropower Plant. However, the Capacity Factor can be extrapolated to larger plants, as it directly influences hydrogen production regardless of plant size.
As stated in [16], renewable energy sources and plant size have direct influences on the capacity factor of the water electrolysis system which, in turn, affects the economic viability of the plant. Depending on the region, the use of one or more renewable sources can be made possible, and the participation of each source must be considered in the sensitivity analysis.
For the specific case of the pilot plant installed in the Itumbiara Hydropower Plant, the sensitivity analysis makes the need for the use of different renewable sources clear. In this case, the solar PV guarantees a lower electricity cost while the hydro source allows the plant to operate with higher capacity factors, strongly contributing to the reduction in the LCOH.

7. Conclusions

In recent years, Brazil has seen constant growth in the share of renewable energy in its energy matrix, driven by cost reductions for its production. This tendency positions Brazil in a promising way for the production of renewable hydrogen, especially due to its favorable natural conditions and relatively low cost of renewable energy.
Renewable hydrogen produced via water electrolysis using electricity from renewable sources results in a zero-emission process. Even though the Brazilian electrical matrix already has a high share of renewable sources, there are concerns regarding its capacity to store electricity. Technologies such as hydrogen can help increase this capacity.
The objective of this work was to analyze the technical and economic benefits associated with the combined use of solar PV and hydro sources to produce renewable hydrogen in Brazil. Data were obtained from the operation of a real pilot plant, equipped with an alkaline water electrolysis system, installed in the Itumbiara Hydropower Plant, including information about the electrolysis conversion efficiency and investment costs.
The obtained results indicated that the capacity factor is the parameter that most impacts the LCOH. Furthermore, CAPEX, OPEX, and electricity costs directly and proportionately influence the hydrogen cost. The use of electricity from solar PV sources lowers the cost due to the cheaper cost of electricity; however, due to its intermittent nature, it can limit the productivity of the hydrogen plant. Thus, the use of a renewable and flexible source, such as hydro, is required to reach higher capacity factors. Therefore, the hydro–solar synergy allows for the optimization of production and of the LCOH while maintaining the quality of the renewable electricity supply.
In terms of efficiency, there was a 1.27% efficiency loss per year during the operation of the pilot plant, which is within acceptable levels. The LCOH was calculated at USD 13/kgH2, a value higher than that found in the literature, due to the specific characteristics of the pilot plant. The sensitivity analysis evidenced the importance of the capacity factor to reduce the hydrogen cost. Furthermore, the use of hydro along with solar PV allows the plant to reach a 90% capacity factor while remaining totally and continuously powered with renewable electricity.
For future work, it is necessary to analyze the use of hydrogen as an electricity vector associated with other applications in the economy from technical, economic, and regulatory points of view in order to guarantee its economic viability. The market for renewable hydrogen is in formation and can be expected to grow, especially for the substitution of non-renewable hydrogen and fossil fuels, such as natural gas, in many industrial sectors. However, it is fundamental to study and to develop demands and regulations which can effectively drive the use of hydrogen as an agent of energy transition.

Author Contributions

Conceptualization, A.B.B.S.R. and V.F.R.; methodology, A.B.B.S.R., V.F.R. and H.N.d.S.F.; formal analysis, E.P.d.S.; investigation, A.B.B.S.R.; resources, A.d.C.P., R.M.C. and L.d.B.S.; data curation, A.B.B.S.R., V.F.R. and H.N.d.S.F.; writing—original draft preparation, A.B.B.S.R.; writing—review and editing, E.P.d.S.; visualization, R.M.C. and L.d.B.S.; supervision, E.P.d.S.; project administration, R.M.C.; funding acquisition, A.d.C.P., R.M.C. and L.d.B.S. All authors have read and agreed to the published version of the manuscript.

Funding

This study was supported by a research scholarship from the Coordination for the Improvement of Higher Education Personnel (CAPES, in Portuguese; grant number 88887.661825/2022-00) and the Electric Energy National Agency (ANEEL, in Portuguese) R&D Fund (project number PD-00394-2204/2022).

Data Availability Statement

The original contributions presented in the study are included in the article, further inquiries can be directed to the corresponding author.

Acknowledgments

The authors thank ANEEL for its Strategic Call no 21/2016, Eletrobras for the Renewable Hydrogen plant development, and for the Coordination of Superior Level Staff Improvement (CAPES, in Portuguese) for the scholarships granted to the researchers.

Conflicts of Interest

Authors Renato Marques Cabral, Leandro de Brito Silva and Alexandre de Castro Pereira were employed by the company Eletrobras. The remaining authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

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Figure 1. Installed capacity by source. Source: prepared by the authors with data from [18].
Figure 1. Installed capacity by source. Source: prepared by the authors with data from [18].
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Figure 2. Renewable hydrogen plant in the Itumbiara Hydropower Plant. Source: Research Archive (2023).
Figure 2. Renewable hydrogen plant in the Itumbiara Hydropower Plant. Source: Research Archive (2023).
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Figure 3. Control volume for this work. Source: Prepared by the authors (2023).
Figure 3. Control volume for this work. Source: Prepared by the authors (2023).
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Figure 4. Share of each electricity source in the plant. PPP stands for photovoltaic plant production, HPP for hydroelectric plant production. Source: prepared by the authors.
Figure 4. Share of each electricity source in the plant. PPP stands for photovoltaic plant production, HPP for hydroelectric plant production. Source: prepared by the authors.
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Figure 5. Solar irradiation hourly distribution profile from solarimetric station data.
Figure 5. Solar irradiation hourly distribution profile from solarimetric station data.
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Figure 6. Plant’s OPEX during its useful life. Source: prepared by the authors.
Figure 6. Plant’s OPEX during its useful life. Source: prepared by the authors.
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Figure 7. Electricity cost per year. Source: prepared by the authors.
Figure 7. Electricity cost per year. Source: prepared by the authors.
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Figure 8. Impact of selected parameters on the LCOH. Source: prepared by the authors.
Figure 8. Impact of selected parameters on the LCOH. Source: prepared by the authors.
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Table 1. Projects developed or in development for renewable hydrogen production via water electrolysis in the electrical sector.
Table 1. Projects developed or in development for renewable hydrogen production via water electrolysis in the electrical sector.
CompanyExecutorApplicationLocationStage
Companhia Energética de São Paulo (CESP) [30]BASE Energia SustentávelElectricity storage from solar PV and wind sources, using batteries and hydrogen Rosana (SP)Pilot Project—Project Completed
Eletrobras
[30]		BASE Energia SustentávelElectricity storage for solar PV source through hydrogen and batteries, and synergies with hydropower plantItumbiara (GO)/
Araporã (MG)		Pilot Project—Initial Project completed in 2023
Eletrobras
[31]		BGEnergyO and M service development for green hydrogen plantsItumbiara (GO)/
Araporã (MG)		Service development—In Progress
Eletrobras
[32]		Parque Tecnológico de Itaipu (PTI)Solid Oxide Fuel Cell and solid-state hydrogen storage technology applicationItumbiara (GO)/
Araporã (MG)		Pilot Project—In Progress
Energia de Portugal (EDP) [33]HytronHydrogen production for thermal power plant input and use in boilers in coal powerplantsFortaleza (CE)Pilot Project—In Progress
Universidade Federal de Itajubá [34]HytronGreen hydrogen research center with multiple applications, including electricity storageItajubá (MG)Research center—Under construction
Parque Tecnológico de Itaipu (PTI) [35]Parque Tecnológico de Itaipu (PTI)Electricity storage using hydrogenFoz do Iguaçu (PR)Pilot Project—Initial Project completed, in operation
Table 2. Data for the PV plant.
Table 2. Data for the PV plant.
PV Plant
ParameterValueSource
Average solar irradiation in Araporã/MG5.659 kWh.m−2day−1Calculated by the authors
PV plant average production4428.92 kWh.day−1Calculated by the authors
Table 3. Electrolyzer technical data.
Table 3. Electrolyzer technical data.
Electrolyzer
ManufacturerAccelera ZeroManufacturer data
Country of originBelgiumManufacturer data
ModelHySTAT-50Manufacturer data
Production capacity51 Nm3.h−1Manufacturer data
Output pressure27.5 bargManufacturer data
Specific consumption (September 2021)59.31 kWh.kg−1Equation (3)
Specific consumption (October 2023)60.92 kWh.kg−1Equation (3)
Hydrogen purity grade99.995%Manufacturer data
Electrolysis system useful life20 yearsManufacturer data
Stack replacementYear 10Manufacturer data
Capacity Factor90%Manufacturer data
Water consumption in the stack 1.5 L/Nm3Manufacturer data
Table 4. Pressurized reservoir technical data.
Table 4. Pressurized reservoir technical data.
Pressurized Reservoir
ManufacturerNitrotecManufacturer data
Country of originBrazilManufacturer data
Side shell materialASTM A516 G70Manufacturer data
Wall thickness25.4 mmManufacturer data
Capacity825 Nm3Manufacturer data
Nominal work pressure27.5 bargManufacturer data
Table 5. CAPEX components.
Table 5. CAPEX components.
EquipmentAmount InvestedSource
ElectrolyzerUSD 1,450,664.59Research data
Storage tankUSD 91,326.53Research data
Engineering, Installations, and CommissioningUSD 561,517.73Research data
Table 6. OPEX components.
Table 6. OPEX components.
Parameter AmountUnit
Stack replacement USD 580,265.84Cost by the plant’s 10th year
OPEX USD 168,280.71USD per year
Table 7. Electricity cost (USD/MWh).
Table 7. Electricity cost (USD/MWh).
Electricity Cost
Solar PV source21.53 USD/MWh[46]
Hydropower source40.07 USD/MWh[46]
Table 8. Daily H2 production from hydropower and solar PV synergy.
Table 8. Daily H2 production from hydropower and solar PV synergy.
ParameterValueUnit
PV plant total electricity generation4428.92kWh/day
Useful PV plant generation for H2 production2639.93kWh/day
Hydropower generation3864.84kWh/day
H2 production109.68kg/day
Table 9. Annual H2 production via hydro and solar PV sources.
Table 9. Annual H2 production via hydro and solar PV sources.
ParameterValueUnit
Total electricity consumption by the electrolyzer2136.82MWh/year
H2 production36,029.25kg/year
Table 10. Electrolyzer efficiency in 2021 and 2023.
Table 10. Electrolyzer efficiency in 2021 and 2023.
EfficiencyValueSource
η E l e c t r o l y z e r i 39.4 59.31   ( T a b l e   3 ) × 100 % = 66.4 % Equation (4)
η E l e c t r o l y z e r o p 39.4 60.92   ( T a b l e   3 ) × 100 % = 64.7 % Equation (4)
Table 11. Costs for the H2 production in the Itumbiara Hydropower Plant.
Table 11. Costs for the H2 production in the Itumbiara Hydropower Plant.
Economic Analysis
CAPEXUSD 5.51/kgH2
OPEXUSD 5.44/kgH2
Total electricity costUSD 2.04/kgH2
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Barros Souza Riedel, A.B.; Feitosa Riedel, V.; Souza Filho, H.N.d.; da Silva, E.P.; Marques Cabral, R.; de Brito Silva, L.; de Castro Pereira, A. Technical–Economic Analysis of Renewable Hydrogen Production from Solar Photovoltaic and Hydro Synergy in a Pilot Plant in Brazil. Energies 2024, 17, 4521. https://doi.org/10.3390/en17174521

AMA Style

Barros Souza Riedel AB, Feitosa Riedel V, Souza Filho HNd, da Silva EP, Marques Cabral R, de Brito Silva L, de Castro Pereira A. Technical–Economic Analysis of Renewable Hydrogen Production from Solar Photovoltaic and Hydro Synergy in a Pilot Plant in Brazil. Energies. 2024; 17(17):4521. https://doi.org/10.3390/en17174521

Chicago/Turabian Style

Barros Souza Riedel, Ana Beatriz, Vitor Feitosa Riedel, Hélio Nunes de Souza Filho, Ennio Peres da Silva, Renato Marques Cabral, Leandro de Brito Silva, and Alexandre de Castro Pereira. 2024. "Technical–Economic Analysis of Renewable Hydrogen Production from Solar Photovoltaic and Hydro Synergy in a Pilot Plant in Brazil" Energies 17, no. 17: 4521. https://doi.org/10.3390/en17174521

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