Demonstration of large-scale steam electrolyser system in industrial market

Topic description

Specific Challenge:

More than 90% of total hydrogen demand comes from large industrial applications, e.g. chemical, refinery and metal works. Today, the vast majority of this hydrogen is produced centrally from natural gas using steam reformers at very low costs (<3 €/kg). Steam reformers typically have capacities of up to 10,000 kg/h hydrogen production and emit 8-11 kg CO2 per 1 kg of hydrogen. Large-scale, efficient electrolysis technologies to produce green hydrogen from renewable electricity could significantly reduce those emissions, if costs can be reduced.
High temperature steam electrolysis (SOEC) has the potential to decrease green hydrogen costs to a level close to fossil hydrogen, as it can use low-cost waste heat or steam at low temperatures (< 200°C) from industrial process to reduce the electrical energy requirement. With availability of steam the electricity consumption can be reduced to <40 kWh/kg. This promises a significant reduction of hydrogen costs for industrial applications.
With support from FCH 2 JU, steam electrolysis has reached TRL 4-5. The challenge is now to scale-up the technology to a level relevant for industrial customers, bring the steam electrolysis closer to the TRL of PEM and alkaline electrolysers and show a perspective for the reduction of hydrogen costs close to steam reformer level.
Furthermore, the proof of the high efficiency, degradation rates and stack lifetime requires long-term testing under industrial conditions. This is key for achieving competitive hydrogen costs in industrial applications, as well as the reduction of CAPEX of steam electrolysers from today’s 10-12 M€/(t/d) to below 3 M€/(t/d). The reduction of CAPEX requires large-scale application and an increase in production volumes.
A scale-up to ‘megawatt class’ is considered an important milestone in system development in the electrolysis industry, when targeting large scale applications. At this scale, specific costs of balance of plant components become more competitive and industrial, more affordable components can be used in the electrolysis systems.

This topic calls for a large-scale steam electrolyser with an output of at least 15 kg/h to be demonstrated in a relevant industrial environment (iron and steel works, refinery, or industry with excess heat / steam that uses H2). The system must use renewable electricity either through direct connection to a renewable power source or through a contractual relationship with a renewable power source (e.g. via a power purchase agreement). In the latter case, the procedure and pitfalls as well as learnings and best practices should be reported. The electrolyser system needs to be equipped with all necessary ancillary equipment for steam and electricity supply as well as hydrogen processing to meet the customer’s expectations in terms of purity, volume and pressure.
The electrolyser should operate for at least two years, whereas a scheduled stack replacement is not foreseen within this time period.
The demonstration should validate prospects for the business case for industry-scale steam electrolysis. The valorisation of any side product (e.g. oxygen) within the industrial environment should be investigated aiming to improve the business case.
The project should aim to the following:

• Development of an improved steam electrolyser system of at least 15 kg/h hydrogen production capacity and demonstration in an industrially relevant environment to benchmark the requirements from the industrial hydrogen consumer against the capability of fossil-based systems. The evaluation will consider innovative business models that could motivate industrial consumers to switch from fossil-based systems to renewable ones;
• A cumulated production of at least 50 tons of renewable hydrogen;
• Specific electricity consumption (beginning-of-life): < 40 kWhel/kg (<3.6 kWhel/Nm³) @ rated power based on external steam supply and without compression; the steam must be provided by the industrial source directly or created from waste heat. The electrical production of steam for the electrolysis is not eligible within this project;
• Demonstrate the hot start from min to max power in less than 5 mins, to provide secondary grid balancing services, as well as the capability of steam electrolysers to follow the fluctuations of renewable power production;
• Average specific electricity consumption (over the project period) should be documented;
• Demonstrate the production of renewable hydrogen, based on the definition of the CertifHy project [19];
• Maintenance and repair costs will be reported and compared to a target of 225 €/(kg/d)/year by 2020, as well as the CAPEX target of 4,500 €/(kg/d) by 2020 and recommendations to meet this target will be given;
• Perform a techno-economic analysis that proves the feasibility of the business case over the lifetime of the system. This analysis should also incorporate the expected operational behaviour of the system during lifetime due to stack degradation;

The grid connection costs, electrolyser costs and the electricity costs for the commissioning phase are eligible for funding. Electricity costs during demonstration / business operation are not eligible and should be covered through the sale of hydrogen.
The proposals should provide the evidence that a suitable electrolysis system can be made available for the project.
The consortium should include at least the electrolyser developer and an industrial hydrogen consumer, who can substitute a substantial amount of its present fossil hydrogen demand with hydrogen production out of steam electrolysis.
TRL at start: 5 and TRL at end: 7.
Any safety-related event that may occur during execution of the project shall be reported to the European Commission's Joint Research Centre (JRC) dedicated mailbox JRC-PTT-H2SAFETY@ec.europa.eu, which manages the European hydrogen safety reference database, HIAD.
Test activities should collaborate and use the protocols developed by the JRC Harmonisation Roadmap (see section 3.2.B "Collaboration with JRC – Rolling Plan 2018"), in order to benchmark performance of components and allow for comparison across different projects.

The maximum FCH 2 JU contribution that may be requested is EUR 4 million. This is an eligibility criterion – proposals requesting FCH 2 JU contributions above this amount will not be evaluated.
A maximum of 1 project may be funded under this topic.

Expected duration: 4 years.

Footnote [19]: http://www.fch.europa.eu/project/developing-european-framework-generation-guarantees-origin-green-hydrogen

A large-scale steam electrolyser system is expected to demonstrate the current cost level, maturity, conversion efficiency advantages and CO2 reduction potentials against state-of-the-art hydrogen production routes (including water electrolysis) in an operational environment.
The project should demonstrate a power purchasing strategy that guarantees the renewable origin of the electricity; however, the electrolyser does not have to be physically connected to a renewable power generation source.

• Proof that steam electrolysers can operate reliably in an industrial environment and consume up to 20% less electricity compared to state of the art low temperature electrolysers;
• Demonstrate a successful operation for a duration of at least 12,000 hours with an availability of > 95 % and without the need of scheduled stack replacement;
• Allow a reliable evaluation of current investment costs (<12 M€/(t/d) in 2017 and 4.5 M€/(t/d) in 2020) with further recommendations for a pathway to capital cost reduction down to <2.4 M€/(t/d) after 2023;
• The hydrogen price after funding should be <7 €/kg and a clear perspective for costs <5 €/kg shall be demonstrated;
• Large-scale demonstration is needed for the development of common interfaces, for the integration and operation of steam electrolysers into an already existing infrastructure.

Type of action: Innovation Action
The conditions related to this topic are provided in the chapter 3.3 and in the General Annexes to the Horizon 2020 Work Programme 2018– 2020 which apply mutatis mutandis.