Diesel Cost Parity

The cost of producing green hydrogen is primarily a function of (1) the cost of renewable energy; (2) the cost of equipment (CapEx) and (3) the efficiency of that equipment in converting renewable energy into hydrogen. Currently, it takes about 50 kWhs of renewable energy to produce 1 kg of hydrogen (~same energy as 1 gallon of diesel). At that level of efficiency, most models for green hydrogen cost parity require a renewable energy input of $0.02/kWh or less. Moreover, that threshold has already been achieved or surpassed in select geographies with plentiful renewable resources. An example is the high profile Haru Oni project led by a consortium of companies including Porsche and Siemens Energy (ENR.DE).  The group will capitalize on very favorable wind conditions in southern Chile near Patagonia to produce lower cost green hydrogen for shipment to Europe.  Among other uses, Porsche will employ some of the output to power its factories in Italy.