1. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 1/15 Integration of a Hydrogen Economy into the German Energy System: an Optimising Modelling Approach EHEC 2005 “2 nd European Hydrogen Energy Conference” November 22 – 25, 2005 Zaragoza, Spain Michael Ball, Otto Rentz (University of Karlsruhe, Germany) Martin Wietschel (Fraunhofer ISI, Karlsruhe, Germany)

2. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 2/15 Objective and model approach Model approach: The MOREHyS model  MOREHyS (Model for Optimisation of Regional Hydrogen Supply)  based on the open-source BALMOREL © model  technology-based (bottom-up), mixed-integer, linear optimisation model (myopic optimisation) - Technologies are described by techno-economic parameters - Optimisation criteria: cost minimisation - Several bounds: emission restrictions, use of renewables, etc. Objective: Development and application of a novel modelling approach to assess by means of an energy system analysis the economic and environmental effects of implementing a supply infrastructure for a hydrogen-based transport system

3. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 3/15 Major features of MOREHyS  conventional energy supply system (electricity and heat generation)  integration of hydrogen supply infrastructure (production, transport, distribution)  tradeoffs between hydrogen and electricity production (energy system analysis)  time horizon: 2010 – 2030  geographic distribution of hydrogen demand centres based on population density  application of Geographic Information System (GIS)

4. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 4/15 Penetration rates of hydrogen vehicles

5. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 5/15 Selected scenarios NameAssumptions Infrastructure scenarios  low natural gas price  cap of CO 2 emissions for power generation Reference “URB”initial hydrogen penetration primarily in urban areas “RUR”immediate hydrogen penetration in urban and rural areas “URB aggr.”high geographic aggregation of demand areas in model “LH 2 ”50 % of vehicle hydrogen is required as LH 2 Energy price scenarios “gas high, CO 2 cap”high natural gas price with CO 2 cap on electricity generation “gas high, no CO 2 cap”high natural gas price without CO 2 cap on electricity generation  further scenarios: surplus wind electricity, hydrogen from nuclear energy, etc.

6. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 6/15 Hydrogen production (Infrastructure scenarios)

7. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 7/15 Total supply costs (Infrastructure scenarios)

8. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 8/15 Total supply costs (LH 2 scenario)

9. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 9/15 Hydrogen production (High gas price scenarios)

10. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 10/15 Load curve electrolysis (2030, no CO 2 cap) marginal electricity generation costs [ct/kWh] used power electricity generation [MW]

11. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 11/15 Load curve IGCC (2030, CO 2 cap) marginal electricity generation costs [ct/kWh] used power electricity generation [MW]

12. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 12/15 Total supply costs (High gas price scenarios)

13. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 13/15 CO 2 emissions

14. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 14/15 Major conclusions  production mix highly sensitive to gas/coal price ratio (total supply costs relatively unchanged)  introduction of hydrogen in high-demand areas leads to economies of scale in hydrogen production  LH 2 trailer transport/distribution economic for large production plants and dispersed hydrogen demand  large production plants imply higher transportation costs  industrial by-product hydrogen important source for initial hydrogen supply

15. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 15/15 Major conclusions (continued)  production dominates total supply costs (7 – 8 ct/kWh)  hydrogen is competitive at crude oil prices around 50 $/barrel (no taxes, no vehicle costs included)  positive CO 2 balance: CO 2 savings transport > CO 2 emissions hydrogen production  coproduction of electricity and hydrogen with IGCC (CCS) especially interesting with cap on CO 2 emissions  use of renewables for electricity rather than hydrogen production, if CO 2 emissions are to be reduced

16. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 16/15 Thank you very much for your attention

17. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 17/15 Back-up slides

18. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 18/15 Outlook and further research  application of Geographic Information System (GIS) for location planning of production sites  integration of conventional transport and supply chains of other alternative fuels  optimal penetration rates  further focus on tradeoffs between hydrogen production and electricity generation

19. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 19/15 Schematic structure of MOREHyS Transmission constraints Production constraints CHPRenewables potential Emissions Fossil fuel potential Current capacity New capacity Heat generation Electricity generation Heat demand Electricity demand Transmission Balance constraints Capacity constraints Hydrogen production Hydrogen demand H 2 balance constraint H 2 transport & distribution constraints Current capacity New capacity H 2 transport & distribution Current capacity New capacity H 2 capacity constraints Current capacity New capacity

20. French-German Institute for Environmental Research (DFIU/IFARE) University of Karlsruhe Fraunhofer ISI Institute Systems and Innovation Research 20/15 Hydrogen infrastructure options Ruhr area Stuttgart Munich Area  h2 Area ah2 Area ah2 ’ GH 2 LH 2 GH 2 LH 2 GH 2 LH 2 GH 2 LH 2 Central production On-site production Virtual node Trailer Large Pipeline Pipeline network GH 2 LH 2 Munich BERLIN Hamburg Ruhr area Stuttgart