Green hydrogen production at 2 EUR/kg in Europe requires significant cost reductions; 3 EUR/kg is more realistic over the next two decades

We have analysed the cost of producing hydrogen from electrolysers via four distinct business models for eight European countries. These countries were chosen by their attractiveness for hydrogen investment according to Aurora’s Hydrogen Market Attractiveness Rating report. The countries include Germany, the Netherlands, the United Kingdom, France, Norway, Spain, Italy, and Sweden.

Key findings of the report include:

  • Clean hydrogen offers a route to decarbonise sectors of the economy such as industry, heavy transport, and heating. The global pipeline of hydrogen electrolyser projects has reached 340GWs, of which 200 GWs is in Europe
  • Aurora Energy Research released a major study assessing the costs of clean hydrogen production from electrolysers across eight European countries
  • Aurora concluded that electrolysers reach cost parity with blue hydrogen production (from methane) in the 2030s
  • Norway will see the lowest electrolysis costs in the 2030s, followed by Spain and Great Britain. The cheapest form of green hydrogen production comes when the electrolyser is co-located with both onshore wind and solar on the same site
  • Connecting the electrolyser to the grid usually increases the cost of production, due to high grid connection charges and other fees. If governments were to waive these fees, grid-fed hydrogen could compete on cost with blue hydrogen by 2034
  • Only by 2050 does electrolysis hydrogen in Europe reach a benchmark of 2 EUR/kg

This is a restricted, public version of our subscriber content. Why not find out more about our European Hydrogen Market Service?

 

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