The colorful economics of hydrogen: assessing the costs and viability of different hydrogen production methods – a review

Increasing greenhouse gas emissions and the increase in renewable energy sources in electricity generation have led to an increasing interest in hydrogen in recent years. As an energy storage solution for renewable energy, hydrogen can contribute to decarbonizing industries and transportation sectors as well as balancing energy systems. In this paper, the primary objective is to examine different methods for producing hydrogen depending on the primary energy source. In addition, it evaluates the economic and environmental performance of three types of hydrogen, known as hydrogen colors, and the significant obstacles to widespread fuel cell adoption. The key finding is that hydrogen's environmental benefits depend heavily on how hydrogen is produced and what fuel is used to produce it. Green hydrogen can only be produced using wind, solar photovoltaic (PV), and hydroelectric power. The emissions from other sources, such as blue hydrogen that uses carbon capture, utilization, and storage (CCUS) or electrolysis using electricity from the grid, are significantly higher than those from grey hydrogen. Furthermore, establishing an international hydrogen market will reduce costs and allow hydrogen to be produced in optimal locations. Lastly, a key unresolved question is whether hydrogen, whatever its color, is economically competitive in any sector of the energy system, despite all external costs associated with it. A policy framework that supports technological advancements, cost reductions, and future priorities will determine hydrogen's success in the future. The transition from grey hydrogen to green hydrogen should be facilitated by this framework.

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