HyXchange: Green Hydrogen Costs Decrease, Grey Gap Narrows

by Admin
Green Hydrogen HyXchange

HyXchange 2023 annual review of its hydrogen cost indicator, HYCLICX, reveals a decline in green hydrogen production costs in the Netherlands. Despite grey hydrogen remaining cheaper, the cost gap is narrowing. The HYCLICX, reflecting variable generation costs of green hydrogen during optimal wind and solar conditions, aligns with European green hydrogen regulations.

The HYCLICX estimates variable production costs for renewable hydrogen from electrolysis, focusing solely on production costs. Collaborating with E-bridge, HyXchange’s index, akin to Germany’s HYDEX, guides industry decisions.

Variable costs for all hydrogen types decreased in 2023, mainly due to declining green electricity prices. Green hydrogen’s competitiveness fluctuates with weather conditions, occasionally surpassing grey and blue hydrogen costs. The monthly HYCLICX, selecting the 50% cheapest electricity hours per month, exhibits green hydrogen nearing grey hydrogen costs in select months.

The daily HYCLICX, using six-hour blocks of cheap production, illustrates daily fluctuations. Some days show green hydrogen cost competitiveness, emphasizing solar and wind abundance’s importance.

Aligned with European rules, the HYCLICX ensures sustainable hydrogen production correlation with green electricity generation. Although 2023 correlation isn’t perfect, it meets requirements until 2030. Market simulations for 2030 anticipate improved hourly correlation, necessitating increased solar and wind capacity.

The HYCLICX index can be followed on HyXchange’s website.

The HyXchange Initiative

Hydrogen is increasingly recognized as a vital component of the energy transition due to its potential to serve as a climate-neutral energy carrier. The Dutch Climate Agreement Act places significant emphasis on hydrogen’s role in the future energy landscape. To facilitate the development of a hydrogen trading market, industry stakeholders have initiated the HyXchange initiative.

Supported by Gasunie, Port of Rotterdam, Port of Amsterdam, Groningen Seaports, North Sea Ports, and numerous market participants, HyXchange aims to establish an open and transparent hydrogen exchange. Key objectives include ensuring an accessible hydrogen transport infrastructure, diversifying hydrogen supply sources, and establishing a reliable and transparent trading platform.

HyXchange also contributes to the development of policy frameworks, advocating for transparent standardization of hydrogen origins through realistic certification systems. The initiative actively participates in policy discussions at national and European levels to promote sustainable hydrogen imports and advance certification standards.

Currently, HyXchange is involved in several projects, including pilot programs for hydrogen certificates, simulation of hydrogen spot markets, exploration of price index products, and the development of standard hydrogen trading contracts. These initiatives aim to foster market liquidity, reduce transaction costs, and promote the adoption of climate-neutral hydrogen.

Source HyXchange