DOE Technical Targets for Hydrogen Production from Electrolysis

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These tables list the U.S. Department of Energy (DOE) technical targets and example cost contributions for hydrogen production from water electrolysis. The tables are organized into separate sections for distributed electrolysis and central electrolysis.

More information about targets can be found in the Hydrogen Production section of the Fuel Cell Technologies Office's Multi-Year Research, Development, and Demonstration Plan.

Distributed Electrolysis

Technical Targets: Distributed Forecourt Water Electrolysis Hydrogen Productiona,b,c

Characteristics Units 2011 Status 2015 Target 2020 Target
Hydrogen levelized costd (production only) $/kg 4.20d 3.90d 2.30d
Electrolyzer system capital cost $/kg 0.70 0.50 0.50
$/kW 430e,f 300f 300f
System energy efficiencyg % (LHV) 67 72 75
kWh/kg 50 46 44
Stack energy efficiencyh % (LHV 74 76 77
kWh/kg 45 44 43
Electricity price $/kWh From AEO 2009i From AEO 2009i 0.037j

Distributed Electrolysis H2A Example Cost Contributionsa,b,c

Characteristics Units 2011 Status 2015 2020
Electrolysis system Cost contributiona,b,e $/kg H2 0.70 0.50 0.50
Production equipment availabilityc % 98 98 98
Electricity Cost contribution $/kg H2 3.00i 3.10i 1.60j
Production fixed O&M Cost contribution $/kg H2 0.30 0.20 0.20
Production other variable costs Cost contribution $/kg H2 0.10 0.10 <0.10
Hydrogen production Cost contribution $/kg H2 4.10 3.90 2.30
Compression, storage, and dispensingk Cost contribution $/kg H2 2.50 1.70 1.70
Total hydrogen levelized cost (dispensed) $/kg H2 6.60 5.60 4.00

a The H2A Distributed Production Model 3.0 used alkaline electrolysis parameters to generate the values in the table with the exceptions described in the notes below. Results are documented in the Current and Future H2A v3 case studies for Forecourt Hydrogen Production from Grid Electrolysis.
b The H2A Distributed Production Model 3.0 was used with the standard economic assumptions: All values are in 2007 dollars, 1.9% inflation rate, 10% After Tax Real Internal Rate of Return, 100% Equity Financing, 20-year analysis period, 38.9% overall tax rate, and 1% working capital (based on independent review input). A MACRS 7-year depreciation schedule was used. The plant design capacity is 1,500 kg/day of hydrogen. It is assumed that Design for Manufacture and Assembly (DFMA) would be employed and that production would have realized economies of scale.
c The plant production equipment availability is 98% including both planned and unplanned outages; four unplanned outages of 14 h duration per year; one planned outage of 5 days duration per year. The plant usage factor (defined as the actual yearly production/equipment design production capacity) is 90% based on over sizing of the production equipment to accommodate a summer surge in demand of 10% above the yearly average demand.
d The levelized cost is equivalent to the minimum required selling price to achieve a 10% annual rate of return over the life of the plant.
e Electrolyzer uninstalled capital costs based on independent review panel results [DOE 2009, Current (2009) State-of-the-Art Hydrogen Production Cost Estimate using Water Electrolysis, Independent Review, NREL/BK-6A1-46676, September 2009]. Electrolyzer capital costs are expected to fall to $380/kW for forecourt production. Escalated to 2007 dollars = $430/kW (purchased equipment cost).
f Electrolyzer cells capital replacement = 25% of total purchased capital every 7 years (DOE, 2009).
g System energy efficiency is defined as the energy in the hydrogen produced by the system (on a LHV basis) divided by the sum of the feedstock energy (LHV) plus all other energy used in the process.
h Stack energy efficiency is defined as the energy in the hydrogen produced by the stack (on a LHV basis) divided by the electricity entering the stack. Additional electricity use for the balance of plant is not included in this calculation. Stack energy efficiency is a guideline and the targets do not need to be met as long as the system energy efficiency meets the targets.
i Hydrogen cost is calculated assuming purchase of industrial grid electricity. Electricity prices are taken from the 2009 AEO Reference Case price projections to 2030. Prices beyond 2030 are not available in the 2009 AEO case so they are projected based on the PNNL MiniCAM model output. The average electricity price is $0.063/kWh ($0.061/kWh effective) over the modeled life of the plant for the current (2011) case and $0.070/kWh ($0.069/kWh effective) for the 2015 case.
j Electricity cost is assumed to be 3.7¢/kWh throughout the analysis period to meet the $4.00/gge target for dispensed hydrogen.
k Costs for the forecourt station compression and storage are consistent with the status and targets in the Delivery MYRD&D section. Storage capacity for 1,579 kg of hydrogen at the forecourt is included. It is assumed that the hydrogen refueling fill pressure is 5,000 psi for 2010 and it assumed that in 2015 and 2020, the hydrogen refueling fill pressure is 10,000 psi.

Central Electrolysis

Technical Targets: Central Water Electrolysisa,b

Characteristics Units 2011 Statusc 2015 Targetd 2020 Targete
Hydrogen levelized cost (plant gate)f $/kg H2 4.10 3.00 2.00
Total capital investmentb $ million 68 51 40
System energy efficiencyg % 67 73 75
kWh/kg H2 50 46 44.7
Stack energy efficiencyh % 74 76 78
kWh/kg H2 45 44 43
Electricity pricei $/kWh From AEO '09 $0.049 $0.031

Central Water Electrolysis H2A Example Cost Contributionsa,b

Characteristics Units 2011 Statusc 2015d 2020e
Capital cost contribution $/kg 0.60 0.50 0.40
Feedstock cost contribution $/kg 3.20 2.30 1.40
Fixed O&M cost contribution $/kg 0.20 0.10 0.10
Other variable cost contribution $/kg 0.10 0.10 0.10
Total hydrogen levelized cost (plant gate) $/kg 4.10 3.20 2.00

a The H2A Central Production Model 3.0 assumed alkaline electrolysis was used to generate the values in the table with the exceptions described in the notes below. Results are documented in the Current and Future H2A v3 case studies for Central Hydrogen Production from Grid Electrolysis.
b The H2A Central Production Model 3.0 was used with the standard economic assumptions: All values are in 2007 dollars, 1.9% inflation rate, 10% After Tax Real Internal Rate of Return, 100% Equity Financing, 40-year analysis period, and a 38.9% overall tax rate. A MACRS 20-year depreciation schedule was used. The working capital was set at 5% instead of the standard 15% based on input from the 2009 independent review of the "Current State-of-the-Art Hydrogen Production Cost Estimate Using Water Electrolysis". The plant design capacity is 52,300 kg/day of hydrogen. The cell stacks for central electrolyzers are assumed to be replaced regularly at a cost of 25% of the initial capital cost. The replacement period is every 7 years in the 2011 case and every 10 years in the 2020 target case. Power availability of 100% is assumed so the electrolysis capacity factor is 98%. The staffing requirement is 10 full time equivalents (FTE) in the 2011 case and 4 FTE in the target cases. The plant gate hydrogen pressure is 300 psi.
c The 2011 status is based on the H2A v3 case study on Current Central Hydrogen Production from Grid Electrolysis with modifications as outlined in the other footnotes. The uninstalled equipment cost of the electrolyzer system is $368/kW (2007$—equivalent to $327/kW in 2005$). They were calculated from the independent review panel's report. The panel reported a Total Depreciable Capital Cost of $50M (2005$) in table 4 (p 22). Using the H2A v2 default indirect costs of 1% for site preparation, 5% for Engineering and Design, 10% for Project Contingency, and 1% for up-front permitting (all percentages of the total direct capital cost), the calculated total direct capital cost is $43,000,000. Removing the installation factor of 1.2 results in a purchased cost of $35,700,000. At the panel's design capacity of 52,300 kg/day and electricity usage of 50 kWh/kg, the resulting purchased cost is $327/kW. The estimated system operation is 50 kWh/kg hydrogen resulting in an efficiency of 67%. The startup year is 2010 and the electricity prices over the plant's life are from the 2009 AEO's reference case projections (extrapolated for dates beyond 2030).
d The 2015 targets are intermediate targets between the 2011 status and 2020 targets. Uninstalled cost of the electrolyzer was set at $300/kW (2007$—equivalent to $267/kW in 2005$), system electricity requirement set at 46 kWh/kg (73% efficiency), and staffing set at 4 FTE. The startup year is 2015 and the electricity price is held constant at $0.049/kWh.
e The 2020 target is based on the capital cost and performance (energy efficiency) required to approach the production portion of the <$4/gge overall delivered hydrogen production cost target consistent with the 2020 delivery cost target of $2.00/gge. The startup year is set to 2025. Uninstalled cost of the electrolyzer is $242/kW (2007$—equivalent to $215/kW in 2005$) based on a 50% reduction in the stack cost from the 2010 status and a 20% reduction in the cost of power electronics resulting in an overall reduction of 34% from the 2010 status. Electricity requirement is reduced to 44.7 kWh/kg (75% efficiency). Electricity price was set to $0.031/kWh (constant over the analysis period) and staffing level was reduced to 4 FTE to achieve the targeted levelized cost of $2.00/kg.
f The H2A Central Production Model 3.0 was used to generate these values at the total invested capital and process energy efficiency indicated in the table.
g System energy efficiency is defined as the energy in the hydrogen produced by the system (on a LHV basis) divided by the sum of the feedstock energy (LHV) plus all other energy used in the process.
h Stack energy efficiency is defined as the energy in the hydrogen produced by the stack (on a LHV basis) divided by the electricity entering the stack. Additional electricity use for the balance of plant is not included in this calculation. Stack energy efficiency is a guideline and the targets do not need to be met as long as the system energy efficiency meets the targets.
i Hydrogen cost is calculated assuming purchase of industrial grid electricity. Electricity prices are taken from the 2009 AEO Reference Case price projections to 2030. Prices beyond 2030 are not available in the 2009 AEO case so they are projected based on the PNNL MiniCAM model output. The average electricity price is $0.067/kWh ($0.063/kWh effective) for the modeled life of the plant for the 2011 case. The electricity price for the 2015 target case is held constant over the plant's life at $0.049/kWh. The electricity price for the 2020 target case is held constant over the plant's life at $0.031/kWh.