HyXchange: variable purchase price of green hydrogen is nearing that of grey hydrogen

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Production costs for green hydrogen decreased in the course of 2023. Although the costs for grey hydrogen were still lower, the gap between the two became smaller. This was the conclusion drawn by HyXchange, a hydrogen exchange initiative, in the 2023 annual review of its own ‘hydrogen indicator’, HYCLICX.

The variable generation costs for green hydrogen in the Netherlands during the ‘cheaper moments’ – periods during which a lot of wind and solar energy is generated – are represented in that index. As a recent HyXchange market simulation for 2030 has shown, that index is suitable for use in terms of the European green hydrogen regulations.

HYCLICX is an instrument that can be used to estimate the variable production costs for renewable electrolysis-based hydrogen in the Netherlands. For the time being, HYCLICX can only make estimates of the variable costs for making hydrogen. The regular investment costs for the electrolyser are still to be added to this. Those costs are substantial, but differ strongly per situation, which is why they have not yet been included in the estimate.
In creating the HYCLICX, HyXchange is cooperating with German company E-bridge, which publishes the German HYDEX hydrogen index. Many basic premises of the two entities are the same.

Decrease throughout 2023

In the course of 2023, the variable costs for all types of hydrogen decreased. Green hydrogen is created out of green electricity and as a result the price decreased. It still depends strongly on the weather: at times when a lot of wind and solar energy is being generated, green electricity – and, as a direct result, green hydrogen – can be cheaper than grey/blue hydrogen. At other times, however, it may be more expensive.

Correlation with European regulations for green hydrogen

HYCLICX runs parallel to the European regulations regarding green hydrogen. Those regulations require such correlation: that type of hydrogen must be made from green electricity that is generated simultaneously, in order to guarantee that the hydrogen is in fact sustainable. HyXchange has performed a research project for that purpose for 2023. In 2023, the low electricity price HYLICX hours also provided a lot more sustainable electricity than the average. The correlation in 2023 was considerable, i.e. it was not yet perfect, but sufficient to meet the monthly correlation requirements prescribed by the European regulations that will be in place through 2030.