Hydrogen storage slashes the cost of grid-connected green H2 production by nearly half, reports steel consortium
Swedish pilot project powered its electrolysers with day-ahead and spot electricity for a month — and paired it with cavern storage
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By using the project’s underground storage facility, the partners were able to deliver hydrogen in a steady flow to SSAB, while also cutting costs by 25-40%, Hybrit reported.
“Despite the fact that Vattenfall optimised trading and operations against real electricity prices during a period with low price variations, the results were very good,” said Marie Anheden, senior project manager at Hybrit. “By applying it in actual circumstances, we were able to follow in real time how much money was saved by using what was stored.”
“The [storage cavern] design itself has proven to be well suited for rapid emptying and filling, interspersed by periods of less activity,” Hybrit reported. “The latest effort to lower the price of hydrogen production used a simulation tool, a new optimisation model and the 100 cubic meter pilot hydrogen storage in Luleå.”
It is not yet clear how the partners guaranteed the electricity was “fossil free”, although it is possible that they bought guarantees of origin for each MWh.
By way of comparison, Nord Pool’s system price for electricity today (Tuesday) is currently €34.08/MWh.
Bigger fluctuations between power prices — brought about by seasonal demand surges and a deeper penetration of variable renewables in the power mix — could result in more opportunities for price arbitrage using energy storage.
The Nord Pool power market encompasses power supply from Norway, Sweden, Denmark, Finland and the Baltic states of Lithuania, Latvia and Estonia.
It was funded by a joint investment of Skr200m ($18m) as well as a Skr52m investment from the Swedish government.
Ultimately the consortium partners plan to scale up the storage element of the project to 100,000–120,000 cubic metres, a facility capable of storing 100 GWh of electricity — enough to power a full-size steel mill’s production for up to four days.
Tests at the pilot facility are expected to continue into next year.
Hybrit has plans to build a bigger DRI and green steel pilot project in Sweden, for which it has landed €143m of grants from the EU Innovation Fund.
The majority of the cash would be used to fund a DRI plant in Gällivare, northern Sweden, that would use 500MW of electrolysers. The remainder will be spent on two new electric-arc furnaces at SSAB’s steel plant in Oxelösund, near Stockholm.
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