Comparing Optimal Operation Policies: Underground Hydrogen Storage vs. Conventional Storage Across Multiple Demand Scenarios

This paper examines and compares optimal operation policies of an underground hydrogen storage system and a conventional surface-level storage tank. Hydrogen is produced through electrolysis powered by an intermittent renewable energy source and distributed across varying demand scenarios. To recreate this setup, an optimization model is developed and solved using Pyomo, a Python-based optimization language, and the Gurobi Optimizer. Special emphasis in the modeling framework is placed on hydrogen losses and quality degradation of the hydrogen retained in the underground storage. The model analysis reveals that flexible demand patterns and strict requirements on the quality of extracted hydrogen reduce the viability of the underground storage. These effects are found to be more significant when overall hydrogen demand is high. However, both storage systems are utilized across all demand scenarios and quality constraints, suggesting that underground storage is essential as a large-scale hydrogen reservoir when large quantities of hydrogen need to be stored.