The cost of green hydrogen currently remains significantly higher than traditional energy sources such as natural gas and conventional hydrogen production methods, but it is rapidly decreasing and expected to become more competitive in the near future.
Current Cost Comparison
- Green hydrogen produced by electrolysis using renewable electricity typically costs between $10 to $15 per kilogram today, depending on the availability and region. This is about 3 to 5 times more expensive per unit of energy (Btu) than natural gas purchased in bulk, which costs roughly $0.50 per therm (a therm is about 29.3 kWh). In energy content terms, hydrogen is 3-5 times more expensive compared to natural gas using advanced electrolysis technology and 10-13 times more expensive using standard renewable electrolysis.
- Traditional hydrogen production methods, such as gray hydrogen made from natural gas without carbon capture, cost around $2 per kilogram in the US but can be higher in regions with expensive natural gas. Blue hydrogen (natural gas with carbon capture) costs about $5 to $7 per kilogram in the US and more in Europe and Australia.
- Innovative green hydrogen production methods, such as gasification of waste or other carbon-negative processes, can produce green hydrogen at lower costs, around $2 to $3 per kilogram today, which is competitive with the cheapest fossil-fuel-based hydrogen.
Future Trends
- The cost of green hydrogen is expected to decline substantially as renewable energy costs continue to fall and technologies scale. By 2030, green hydrogen costs are projected to reach around $2 per kilogram, comparable to or even below the cost of gray and blue hydrogen in many regions.
- This anticipated cost parity with traditional hydrogen forms and fossil fuels could make green hydrogen a truly competitive and widely adopted clean energy source within the next decade.
Summary Table
| Energy Source / Hydrogen Type | Current Cost per kg H2 | Cost per Unit Energy | Notes |
|---|---|---|---|
| Green hydrogen (electrolysis) | $10 – $15 | 3-13 times natural gas per Btu | Depends on renewable energy availability |
| Green hydrogen (innovative tech) | $2 – $3 | Competitive with fossil hydrogen | SGH2 method using gasification |
| Gray hydrogen (natural gas) | ~$2 (US) to $5-6 (EU/Asia) | Less expensive per Btu | Conventional steam methane reforming |
| Blue hydrogen (CCS) | $5 – $7 (US), up to $11 | Moderately more expensive | Natural gas + carbon capture |
| Natural gas (bulk purchase) | $0.50 per therm | Cheapest energy source | Reference baseline for comparison |
In conclusion, while green hydrogen is currently more expensive than traditional energy sources like natural gas and gray hydrogen, its cost trajectory is strongly downward. Green hydrogen is on course to become cost-competitive by 2030, paving the way for broader adoption in clean energy applications.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-the-cost-of-green-hydrogen-compare-to-traditional-energy-sources/
