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Power2Gas - Hype or Key to the Energy Transition?

Author: Anika Regett, Christoph Pellinger, Forschungsstelle für Energiewirtschaft e.V.   (As of March 2017) The following brief summary is based on the publication of the same name in et - Energiewirtschaftliche Tagesfragen [1], further information on the topic of Power2Gas can be found here.

The extraction of hydrogen or methane, using electrical energy in a chemical conversion process, is called Power2Gas. The hydrogen is thereby obtained by the electrolysis of water. In a subsequent methanation step, methane can be synthesized from the hydrogen - with the addition of CO2. The gases produced can be fed into the existing natural gas infrastructure, consisting of the gas grid and gas storage facilities, and stored there over long periods of time. The gas can also be used in other areas of the supply system, such as the heating or mobility sector, apart from re-conversion into electricity.

Technical parameters of Power2Gas systems

In the following, the technical parameters of Power2Gas systems are presented in tabular form. It can be seen that Power2Gas systems - especially in the case of additional methanation - have a low efficiency. For example, methane generation with an alkaline electrolysis system in 2030 would be associated with losses of 52%.

The achievable load gradients and the possibility of partial and overload operation suggest that intermittent operation in the seconds range is possible. Because of activationPower2Gas - Hype or Key to the Energy Transition? However, standby operation to maintain the operating temperature, which is accompanied by continuous energy consumption, is assumed. Due to higher load gradients and better partial and overload capability, proton exchange membrane electrolysis (PEMEL) is more suitable for dynamic operation than alkaline electrolysis (AEL).

Cost structure of Power2Gas systems
Figure 2: State of the art and future potential of specific investments including range of literature values for alkaline electrolysis (AEL), proton exchange membrane electrolysis (PEMEL) and a system including methanation (AEL + Meth.) (Image credit: FfE).

Economic evaluation of Power2Gas

For the calculation of the gas production costs of Power2Gas plants, electricity procurement costs are taken into account in addition to investments and fixed operating costs. Fig. 3 shows that even in the case of free electricity procurement, economic operation for specific investments of 500 €/kWel expected in 2030 is only possible when approximately 2,800 full load hours are achieved. These full load hours, which are necessary for economic viability, are compared to the number of hours with balance sheet 'surpluses' in 2030. These amount to less than 2,000 hours - neglecting transmission capacities abroad. An economic viability of Power2Gas for hydrogen production is therefore not given in 2030 due to the high specific investments.

Technical characteristics of electrolysis systems
Figure 1: Technical parameters of electrolysis systems (AEL = alkaline electrolysis; PEMEL = proton exchange membrane electrolysis) and methanation systems (photo credit: FfE).

Cost structure of Power2Gas systems

As shown in Fig. 2, manufacturers and research institutes expect a reduction in specific investments by 2030.

The wide ranges of specific investments can be explained by the costs for peripheral components, which are incurred almost independently of the capacity of the electrolysis system. Cost reduction is possible mainly by upscaling the system size. In addition to improving the technical parameters, such as increasing the power density, overload capacity and long-term stability, a cost reduction is aimed at for PEM electrolysis, in particular by reducing and substituting the platinum metal catalysts.

Hydrogen production costs
Figure 3: Hydrogen production costs as a function of full-load hours for different scenarios of specific investments (solid lines: including electricity procurement costs; dashed lines: free electricity procurement) (Image credit: FfE).

Potentials for Power2Gas

As very large storage capacities with low self-discharge rates are available within the natural gas infrastructure, Power2Gas is in principle an option for storing large amounts of energy in the TWh range. However, by 2030, the amounts of electrical energy to be stored and the hours of negative residual load are so small that it is not economically feasible to operate a Power2Gas facility given the expected investments and current market prices. Due to further conversion losses and higher investments, the economic relevance of the plant deteriorates in case of additional methanation. In addition to the improvement of technical parameters, a strong cost reduction must be achieved in order to be able to market Power2Gas plants economically in the future.

The already existing market for hydrogen in industry will - in the event of political promotion of hydrogen-based mobility - be supplemented by a further market in the short to medium term, if necessary. Taking into account the expansion targets of the German states, Power2Gas in 2030, on the other hand, is not yet relevant for the storage of electrical energy in times of load surpluses due to feed-in from renewable generators. However, with an expansion of renewables to a share of >50% of electricity generation, Power2Gas may become relevant beyond 2030 for the long-term storage of large amounts of electrical energy in the TWh range.

Reference:

[1] Regett, Anika; Pellinger, Christoph; Eller, Sebastian: Power2Gas - Hype oder Schlüssel zur Energiewende in: Energiewirtschaftliche Tagesfragen - 64th Jg. (2014) Heft 10. Essen: etv Energieverlag GmbH, 2014