Hydrogen underground storage for grid electricity storage: An optimization study on techno-economic analysis

Chen, Yunzhi; Hill, Daniel; Billings, Blake; Hedengren, John; Powell, Kody

doi:10.1016/j.enconman.2024.119115

Hydrogen underground storage for grid electricity storage: An optimization study on techno-economic analysis

Journal Article · Thu Oct 03 00:00:00 EDT 2024 · Energy Conversion and Management

DOI:https://doi.org/10.1016/j.enconman.2024.119115· OSTI ID:2462855

Chen, Yunzhi ^[1]; Hill, Daniel ^[2]; Billings, Blake ^[3]; Hedengren, John ^[2]; Powell, Kody ^[1]

Univ. of Utah, Salt Lake City, UT (United States)
Brigham Young Univ., Provo, UT (United States)
Oak Ridge National Laboratory (ORNL), Oak Ridge, TN (United States)

Here, this study performs a techno-economic analysis of hydrogen underground storage systems for grid electricity storage, evaluating their economic viability at the plant scale using dynamic optimization. It explores the feasibility of various system configurations and revenue models in the context of volatile electricity prices and the necessity for multiple revenue streams. The hypothesis tested is that large-scale hydrogen storage, despite its low round-trip efficiency, can be economically viable with the right mix of revenue streams. This study uses scenario-based analysis to assess the impacts of different system configurations, including engaging in time-shifting arbitrage, ancillary service markets and blending hydrogen with natural gas. Results indicate potential annual net cash flows of up to $$\$$$$1.5 million from ancillary services integration and $$\$$$$5.2 million from natural gas blending, contingent on specific system sizes. The study concludes that hydrogen underground storage for grid electricity storage can be profitable, and emphasizes that proper system design and precise electricity price forecasting are crucial for optimizing system performance and economic returns. This research sets the stage for further investigations into the scalability of hydrogen storage systems and their broader implications for grid electricity storage and energy market dynamics.

View Accepted Manuscript (DOE)

Research Organization:: Oak Ridge National Laboratory (ORNL), Oak Ridge, TN (United States)

Sponsoring Organization:: Office of Energy Development (OED); USDOE

Grant/Contract Number:: AC05-00OR22725; EE0009708

OSTI ID:: 2462855

Journal Information:: Energy Conversion and Management, Journal Name: Energy Conversion and Management Vol. 322; ISSN 0196-8904

Publisher:: ElsevierCopyright Statement

Country of Publication:: United States

Language:: English

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