Digital levers for enhancing and accelerating the development of low-carbon hydrogen

Delivering greater value from your low-carbon hydrogen assets by using better asset information to improve investment decisions and operations.

The low-carbon hydrogen economy has made significant progress in recent years, with demand projected to grow massively to 38 Mt by 2030.

However, major challenges stand in the way of widespread deployment, with only a fraction of announced projects currently in the final investment decision (FID) or construction phase.[1] This is primarily a budget issue: the production cost of low-carbon hydrogen ranges from €6-9/kg versus €1.5-3/kg for hydrogen from natural gas reforming.[2] The steep levelised cost of hydrogen (LCOH) for low-carbon hydrogen produced via electrolysis is caused by several factors, including power costs, equipment costs, and operational expenses.

Fortunately, a growing number of projects are advancing into the early stages of development, with asset developers actively seeking ways to mitigate costs. Digitalisation is emerging as a key strategy to support these developers and the wider low-carbon hydrogen ecosystem.

Siemens and Capgemini have analyzed digital solutions and identified specific levers to lower LCOH. This approach, designed to assist project developers, operators, and asset managers, addresses challenges across various stages of a low-carbon hydrogen project.

The approach encompasses:

• Enhancing design and construction efficiency through digital simulations and 3D computer-aided design (CAD)
• Streamlining operations with real-time data and digital maintenance, improving productivity and asset reliability
• Ensuring traceability of carbon content for regulatory compliance
• Optimising asset portfolio management, integrating new assets with existing ones, and informing investment decisions with simulation tools.

The collaboration aims to drive the hydrogen economy forward, supporting the development of sustainable fuels and decarbonisation across various sectors. In our joint white paper, we delve into the digital levers that can reduce the LCOH, focusing on hydrogen production – particularly in the context of electrolysis.

Read the full paper to discover how to leverage the opportunities of low-carbon hydrogen production.

[1] https://www.iea.org/reports/global-hydrogen-review-2023/executive-summary (accessed on 21/06/2024)

[2] https://hydrogencouncil.com/wp-content/uploads/2023/12/Hydrogen-Insights-Dec-2023-Update.pdf#:~:text=URL%3A%20https%3A%2F%2Fhydrogencouncil.com%2Fwp (accessed on 21/06/2024)