Techno-economic viability of renewable electricity surplus to green hydrogen and biomethane, for a future sustainable energy system: Hints from Southern Italy

The fast deployment of renewable energy in Italy by 2030, according to the National Energy and Climate Plan, will lead to renewable electricity surplus mainly in Southern Italy where adequate energy storage is not currently available. In this paper, a Power to Green Hydrogen followed by a methanation process is proposed to accelerate decarbonisation and the integration of higher shares of variable renewable energies in Southern Italy. Green hydrogen can be injected directly into the natural gas grid or used to produce biomethane that can be injected afterwards into the natural gas grid. The main results of our assessment are: 1) 819 – 1,638 Mm³ green hydrogen that could be produced by water electrolysis using the renewable electricity surplus; 2) 160 Mm³ biomethane produced through biogas upgrading and 3) 14 – 117 Mm³ additional biomethane produced through methanation by using biogenic carbon dioxide from biogas upgrading. The approach would enable a) green hydrogen production cost competitive with grey hydrogen (44 €/MWh) only when the electrolysis system uses electricity for free and its load factor is above 1,800 h/y and 5,000 h/y for the optimistic and conservative case, respectively; b) biomethane production cost via biogas upgrading (about 58 €₂₀₂₀/MWh); and c) biomethane production cost via methanation competitive versus natural gas price (30 €/MWh) only when using electricity for free and operates at full load for over 5,400 h/y in the optimistic case.