Hydrogen Economy

If You Can’t Beat Them – C-MACC Enters the Mythical Hydrogen Pricing Game!
January 17, 2024
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Next Week:

The Hydrogen Economy #29

If You Can’t Beat Them – C-MACC Enters the Mythical Hydrogen Pricing Game!

  • Weekly Theme: A Cost-Based Pricing Model
    • News Update
    • Projects Update
    • Ammonia/Methanol Update
    • Power Update
  • Next Week: Hydrogen’s Role in Clean Fuels – This Year

Key Points

  • We introduce the C-MACC Hydrogen Cost Model, which others are calling pricing. This will be updated once a month, and we welcome input about how we can make the service more helpful/relevant.
  • Current large-volume power costs show production of green hydrogen as prohibitively expensive everywhere except a pocket of large-scale curtailed power in Western China – hence the investment momentum there.
  • Blue makes a lot of sense in Europe and the US, especially when accounting for the carbon cost of grey hydrogen in Europe and the relative carbon benefit of blue. 45Q leaves the US in a dominant position.
  • But the real challenge is the narrow focus of trying to make green hydrogen from only wind and solar power. Capacity factor matters, and hydro and nuclear are real opportunities – or we focus on blue hydrogen.

Exhibit 1: The “Green Dream” will not happen without cheap power – note China.

Source: Bloomberg, Capital IQ, and multiple other sources – C-MACC Analysis

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