This page demonstrates creation and documentation of a project finance model for a hydrogen project. I show the project finance model and I also include a file for computing the levelised cost of an electrolyzer compared to the levelised cost of producing hydrogen from natural gas. I use a case study from Egypt with an electrolyzer from China. I have tried to explain the financial model using a power point presentation and with a video. The cost drivers and the hurdles to producing green hydrogen are emphasized as well as typical mis-understanding of drivers. I argue that producing hydrogen in Egypt is a way to transfer the solar energy from the Sahara Desert to Europe and to deal with the high natural gas price in Europe.
The power point slides below describe the modelling process including computing the LCOH and creating a comprehensive financial model.
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Hydrogen LCOH and Financial Model
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The slides and the powerpoint slides attached to the buttons below illustrate issues associated with computing the cost of green versus grey hydrogen. I have purposely made the analysis provactive with a very low cost hydrogen electrolyzer from a Chinese supplier. I suggest that from an economic perspective the idea of combining solar and wind to bring electricity to the hydrogen.
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Power Point Slides Describing Financial Model for Hydrogen Using Renewable Energy and Natural Gas
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The files below includes a hydrogen financial model that includes detailed a detailed hydrogen financial model and a levelized cost of hydrogen analysis. You can decide which is more valuable for different kinds of analysis.
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Excel File with Financial Model for Hydrogen Using Wind and Solar Power Compared to Natural Gas
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The file below is a template file for entering hour by hour data on wind, solar, battery and load. The file does not include a full data set because it would be very large. You should copy the data from PVGIS into the file and then copy the formulas to added lines to get a full set of data. Once you have filled in the data for your location, you can copy the month by month energy produced and used into a financial model like the model above.
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The third file is a simple input layout for making a basic financal model of hydrogen. I have included this file so that you can become comfortable in building a basic model and understanding things like the effect of the capital cost of the hydrogen project, the cost of electricity for the project, the capacity factor for the project and the efficiency of the project. The file is not filled in, but if you use the generic macro file, you should be able to do this analysis in a quarter of an hour or so. You can also use the example file to make a nice sensitvity analysis with a waterfall chart.
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