Green hydrogen production for oil refining – Finnish case

Abstract

This study investigates the production of green hydrogen for use in oil refining, as specified in the draft of European union delegated act published in May 2022. The European union plans to set strict requirements of additionality and reporting regarding the criteria of renewable electricity used in hydrogen production. Alkaline electrolyzer, proton exchange membrane electrolyzer and solid oxide electrolyzer are evaluated in various scenarios supplied by wind power: power purchase agreement-based scenarios and wind power investment-based scenarios. In power purchase agreement-based scenarios baseload and pay as produced power purchase agreements (with and without electricity storage) are assessed. According to results, the use of 600 MW compressed air energy storage could reduce the dependency on the grid by 7% but increase the cost of green hydrogen significantly. Investment-based scenarios produce green hydrogen with a lower operation cost, but higher break-even price compared to power purchase agreement-based scenarios. The cheapest green hydrogen can be achieved by alkaline electrolyzer with baseload power purchase agreement. Direct ownership of wind power is outside the operation of oil refining industry, thus power purchase agreements contracting is more likely to realize.