Hydrogen Tech World October 2024 | Page 11

[ cover story ] revenues to recoup investments . Secondly , offtakers require stable hydrogen production to feed downstream processes and meet high consumption targets . This perspective stands at odds with electrolysis as a flexible demand provider . So , the question is : can the two objectives be combined ?
Regulation and grid perspective
In the case of the Netherlands , the spot market comprises day-ahead and intraday markets , with prices determined by supply and demand dynamics . The local system operator , TenneT , ensures the balance between electricity supply and demand , procuring flexible resources for load adjustments through various mechanisms . Asset flexibility – the ability to quickly adjust load up or down – is crucial for managing supply and demand fluctuations , leading to more stable prices and system security .
Therefore , power-to-gas , specifically through electrolysis , holds significant potential in the energy sector as a provider of such flexibility . Electrolysers can indeed consume power during periods of high renewable generation and minimise consumption when power is scarce , playing a key role in surplus utilisation and preventing negative prices . Flexible operation combined with market optimisation contributes to balancing the grid , facilitating the rollout of renewable sources and enhancing the financial performance of hydrogen projects .
Flexible operation of electrolysers is also supported by European legislation , such as the Renewable Energy Directives ( RED ) and its Delegated Act , which state that to be considered green , hydrogen must follow temporal ( hourly after 2030 ) correlation with renewable generation .
TenneT ’ s Adequacy Outlook explores the resources needed in a net-zero carbon emission energy system . The outlook assumes 50 gigawatts
Megawatt project in progress in the Port of Rotterdam , the Netherlands
of electrolyser installed capacity with an average load of approximately 20 %, far from roundthe-clock utilisation . Hydrogen projects are not expected to be major grid service providers but can benefit from them by lowering energy costs and adding new revenue streams .
From the regulation and grid perspective , electrolysers are needed as providers of flexible demand to reduce the imbalance between intermittent renewables and fixed demand for electricity .
Project development perspective
The hydrogen value chain is gradually being implemented with projects of increasing scale , focusing on green hydrogen production and delivery to industry and mobility . Developers face numerous barriers , including high hydrogen production costs , limited willingness to pay a
Hydrogen Tech World | Issue 18 | October 2024 11