Analysis of the economy of scale and estimation of the future hydrogen production costs at on-site hydrogen refueling stations in Korea

Abstract This paper deals with the analysis of the economy of scale at on-site hydrogen refueling stations which produce hydrogen through steam methane reforming or water electrolysis, in order to identify the optimum energy mix as well as the total construction cost of hydrogen refueling stations in Korea. To assess the economy of scale at on-site hydrogen stations, the unit hydrogen costs at hydrogen stations with capacities of 30 Nm 3 /h, 100 Nm 3 /h, 300 Nm 3 /h, and 700 Nm 3 /h were estimated. Due to the relatively high price of natural gas compared to the cost of electricity in Korea, water electrolysis is more economical than steam methane reforming if the hydrogen production capacity is small. It seems to be the best strategy for Korea to construct small water electrolysis hydrogen stations with production capacities of 100 Nm 3 /h or less until 2020, and to construct steam methane reforming hydrogen stations with production capacities of 300 Nm 3 /h or more after 2025.