Hydrogen in Decarbonized Energy Systems

Key messages from the report:

Hydrogen brings system benefits in addition to decarbonising hard-to-abate sectors

• Resource-rich regions need to prioritize connecting renewable resources to demand centres via hydrogen pipelines
• Resource-poor regions need to focus on maximising the value of limited renewables available, and can use curtailed power to make hydrogen
• Islanded power systems need to pay extra attention to flexibility, which electrolyzers and hydrogen turbines can provide

Renewable hydrogen production will add flexibility to energy systems and consequently reduce the cost to decarbonize

• Electrolyzers can respond to market prices to help alleviate supply-demand crunches in systems relying on high levels of intermittent wind and solar
• Hydrogen to power provides resilience against most challenging part of the year when renewable load is low and energy demand is high. It complements the role of batteries and CCS in doing so

Network infrastructure and sensible market design rules are critical enablers for decarbonisation using hydrogen

• Hydrogen and CO₂ pipelines will enable production while storage is key to unlocking flexibility benefits
• Allowing electrolyzers to respond to prices will ensure lower overall energy costs and less price volatility