The brief was prepared as part of the activities of the working group “Balancing and optimisation of large-size electrolyser plant”, which brings together hydrogen IPCEI projects to exchange knowledge and leassons learned as well as identify common drivers and barriers for deployment. The work contributes to the broader aim of IPCEI Hy2Use to share results across borders, support the development of a European hydrogen market and enable wider replication.
The brief focuses on a central challenge for large-scale electrolysers. From an energy system perspective, flexible hydrogen production can support renewable electricity integration, reduce balancing costs and improve the use of electricity and hydrogen infrastructure. From a project perspective, however, flexibility is often difficult to quantify, monetise and include in financing logic.
Most hydrogen investments are still structured around stable operating profiles to secure predictable revenues, equipment warranties and bankability. Flexible operation may introduce uncertainty related to efficiency losses, equipment degradation and lifetime performance. At the same time, revenues from flexibility depend on market conditions that may still be volatile, immature or inaccessible to hydrogen producers.
The brief highlights this as a structural misalignment between system value and project economics. While the wider energy system benefits from flexibility, the related costs and risks are often carried by individual projects.
The publication identifies several areas for action, including:
- improving electricity market access for hydrogen producers
- making flexibility revenues more predictable and bankable
- embedding flexibility into public funding and project assessment frameworks
- protecting climate integrity while enabling operational flexibility
The brief concludes that flexibility must become visible and remunerated in project economics if large-scale hydrogen production is to contribute fully to a renewables-based energy system.
Read the full brief below!
CLIC Innovation facilitates the working groups under IPCEI Hy2Use Knowledge Sharing Consortium.