Cost-Effective Green Hydrogen Production: A Simulation Study on Energy Mix Optimization

The European regulatory framework establishes that the production of green hydrogen (H2) must be supported either from the electricity grid through a power purchase agreement (PPA), or from intermittent renewable energy sources (RES) plants owned by the hydrogen producer. In this paper, a mixed-integer linear programming (MILP) problem, assuming as objective function the overall cost minimization of the allowed energy mix for green hydrogen production, has been formulated. Through simulation results on several scenarios considering different H2 production targets, RES production, and cost for PPAs, we estimated the cost for green H2, and it is compared with that of grey H2, i.e. generated from natural gas, or methane.