top of page

Green Hydrogen current and projected production costs

Updated: Jan 3

Determining the Cost of Green Hydrogen

Studies have found that there is significant variation in the cost of electrolyzer systems, ranging from USD 306/kW up to USD 4,748/kW. Thus, demonstrating the challenge of finding representative numbers for capital and operation costs of electrolyzers (Saba, et al., 2020). As such, these costs are determined based on the combination of projected overall costs of green hydrogen along with the estimated cost breakdown of electricity costs, CAPEX, and OPEX.

Work by Jeffers, et al. (2021) shows cost breakdown estimates for green hydrogen in 2020 and 2050, as tabulated in Table 1. Using these values, the cost breakdown percentiles of green hydrogen in 2030 and 2040 can also be determined through extrapolation. The cost breakdown for each decade is presented in Figure 1.

Green hydrogen cost breakdown estimates
Table 1 - Green hydrogen cost breakdown estimates

Estimated green hydrogen cost breakdown
Figure 1 - Estimated green hydrogen cost breakdown

There are various studies that estimate the cost of green hydrogen based on a variety of other sources to improve accuracy. Three of which are by the European Commission, the U.S. Department of Energy, and the International Energy Agency (IEA).

The European Commission (2020) estimates the current cost of green hydrogen to be in the range of EUR 2.50-5.50/kg, whereas the U.S. Department of Energy (2020) estimates a range of EUR 4.44-5.32/kg, and the IEA (2021b) estimates a range of EUR 3.10-6.65/kg. Taking an average of the three, we can consider green hydrogen to currently cost around EUR 4.59/kg.

Projected future costs of green hydrogen have also been studied by various parties. By 2030, green hydrogen is expected to compete with fossil-based hydrogen (European Commission, 2020) with cost estimates of EUR 1.15-3.10/kg (IEA, 2021a), giving an average of EUR 2.13/kg.

There are fewer studies giving cost estimates for 2040, however, a study by Wood Mackenzie (2020) expects a fall in the cost of up to 64% compared to 2020 prices. Based on the cost estimate of EUR 4.59/kg for 2020, we can expect a 2040 price of around EUR 1.56/kg; a cost that also lines up with the extrapolation of 2030 and 2050 cost estimates.

Most studies project a cost for 2050 to be below USD 1/kg (EUR 0.89/kg) in locations with high potential for renewable resources (International Energy Agency, 2021; KPMG, 2021; PwC, 2021; BNEF, 2020), but to be conservative, a 2050 cost is estimated equal to EUR 0.89/kg. The estimated costs for all timeframes for this project are presented in Table 3.

Summary of green hydrogen cost estimates
Table 3 - Summary of green hydrogen cost estimates

Combining the estimated costs and cost breakdowns for each timeframe, the CAPEX and OPEX of green hydrogen can be determined, see Table 4. For clarity, the estimated CAPEX and OPEX of green hydrogen for each time period are presented in Figure 2, while Figure 3 presents these values converted into EUR/kW.

Structures Insider - Summary of current and future green hydrogen cost estimates
Table 4 - Summary of current and future green hydrogen cost estimates

Cost estimates of green hydrogen (EUR/kg)
Figure 2 - Cost estimates of green hydrogen (EUR/kg)



Cost estimates of green hydrogen (EUR/kW)
Figure 3 - Cost estimates of green hydrogen (EUR/kW)

Hydrogen Cost Convergence

Based on the projected costs of blue and green hydrogen previously discussed, the cost of both types of hydrogen can be expected to converge around 2029, see Figure 4. Past this point, green hydrogen becomes most cost-competitive than blue hydrogen, with the price gap increasing with time. As such, any hydrogen produced past 2029 with this project should be in the form of green hydrogen in order to maximize economics.

Structures INSIDER -  Cost convergence of blue and green hydrogen
Figure 4 - Cost convergence of blue and green hydrogen



ADFC (no date). Hydrogen Basics. [online] Available at: [Accessed 20 October 2021].

Antweiler, W. (2020). What role does hydrogen have in the future of electric mobility? [online] Available at: [Accessed 12 November 2021].

Azinheira, G., Segurado, R. & Costa, M. (2019). ‘Is Renewable Energy-Powered Desalination a Viable Solution for Water Stressed Regions? A Case Study in Algarve, Portugal’, Energies, Vol. 12, doi: 10.3390/en12244651.

Bezdek, R. H. (2019). ‘The hydrogen economy and jobs of the future’, Renew. Energy Environ. Sustain., Volume 4, January 2019, DOI:

BNEF (2020). ‘Hydrogen Economy’ Offers Promising Path to Decarbonization. [online] Available at: [Accessed 22 December 2021].

Bruce, S., Temminghodd, M, Hayward, J., Schmidt, E., Munnings, C., Palfreyman, D. & Hartley, P. (2018). ‘Australia’s National Hydrogen Roadmap’, CSIRO, Energy and Futures, Australia.

Cavana, M. & Leone, P. (2021). ‘Solar Hydrogen from North Africa to Europe through Greenstream: A simulation-based analysis of blending scenarios and production plant sizing’, International Journal of Hydrogen Energy, Vol. 46, pp. 22618-22637.

Cummins Inc. (2020). Electrolyzers 101: What they are, how they work and where they fit in a green economy. [online] Available at: [Accessed 20 October 2021].

Dawood, F., Anda, M. & Shafiullah, G. M. (2020). ‘Hydrogen production for energy: An overview’, International Journal of Hydrogen Energy, Vol. 45, Issue. 7, February 2020, pp. 3847-3869.

Deloitte (2020). ‘Investing in hydrogen – Ready, set, net zero’, November 2020.

Duren, M. (2017). ‘Energy in Times After the Energy Transition’, Understanding the Bigger Energy Picture, DOI 10.1007/978-3-319-57966-5_3, pp.45-87.

European Commission (2020). ‘A hydrogen strategy for a climate-neutral Europe’, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, Brussels, July 2020.

EIA (no date). Hydrogen explained- Production of hydrogen. [online] Available at: [Accessed 16 December 2021].

Einav, R., Harussi, K. & Perry, D. (2002). ‘The footprint of the desalination processes on the environment’, Desalination, Vol. 152, pp.141-154.

EERE (2021). Liquid Hydrogen Delivery. [online] Available at: [Accessed 20 October 2021].

Giovannini, S. (2020). 50 shades of (grey and blue and green) hydrogen. [online] Available at: [Accessed 03 December 2021].

Guo, Y., Li, G., Zhou, J. & Liu, Y. (2019). ‘Comparison between hydrogen production by alkaline water electrolysis and hydrogen production by PEM electrolysis’, Earth and Environmental Science, Vol. 371, 2019, doi: 10.1088/1755-1315/371/4/042022.

Hague, O. (2021). What are the 3 Main Types of Hydrogen? [online] Available at: [Accessed 03 December 2021].

Ibeh, B., Gardner, C. & Ternan, M. (2007). ‘Separation of hydrogen from a hydrogejn/methane mixture using a PEM fuel cell’, International Journal of Hydrogen Energy, Vol. 32, Issue 7, May 2007, pp. 908-914.

Ibrahim, J. M. & Moussab, H. (2020). ‘Recent advances on hydrogen production through seawater electrolysis’, Materials Science for Energy Technologies, Vol. 3, 2020, pp. 780-807.

IEA (2021a). Global Hydrogen Review 2021. [online] Available at: [Accessed 22 December 2021].

IEA (2021b). Net Zero by 2050 – A Roadmap for the Global Energy Sector. [online] Available at: [Accessed 14 December 2021].

Jeffers, B., Gutcher, S., Hassan, N., Pace, S. & Hoogendoorn, R. (2021). Hydrogen: Ready for Take Off?, University of Surrey, Multi-Disciplinary Design Project, 2020-21.

Kalamara, C. M. & Efstathiou, A. M. (2013). ‘Hydrogen Production Technologies: Current State and Future Developments’, Power Options for the Eastern Mediterranean Region, Conference Papers in Energy, November 2012, Limassol, Cyprus.

Khan, M. A., Al-Attas, T., Roy, S., Rahman, M. M., Ghaffour, N., Thangadurai, V., Larter, S., Hu, J., Ajayan, P. M. & Kibria, M. G. (2021). ‘Seawater electrolysis for hydrogen production: a solution looking for a problem?’, Energy & Environmental Science, Vol. 14, Issue 9, pp. 4831-4839.

KPMG (2021). The Hydrogen Trajectory. [online] Available at: [Accessed 22 December 2021].

Ludwig Bölkow Systemtechnik (no date). Hydrogen Data. [online] Available at: [Accessed 20 October 2021].

Mathiesen, B. V., Ridjan, I., Connolly, D., Nielsen, M. P., Vang Hendriksen, P., Bjerg Mogensen, M., Hojgaard Jensen, S. & Dalgaard Ebbesen, S. (2013).

Technology data for high temperature solid oxide electrolyser cells, alkali and PEM electrolysers, Department of Development and Planning, Aalborg University.

McMahon, M. (2020). New Technology Seamlessly Converts Ammonia to Green Hydrogen. [online] Available at: [Accessed 20 October 2021].

Melaina, M. W., Antonia, O. & Penev, M. (2013). ‘Blending Hydrogen into Natural Gas Pipeline Networks: A Review of Key Issues’, NREL, technical report, March 2013.

Milbrandt, A. & Mann, M. (2009). ‘Hydrogen Resource Assessment – Hydrogen Potential from Coal, Natural Gas, Nuclear, and Hydro Power’, NREL, Technical Report, February 2009.

National Grid (2021a). The hydrogen colour spectrum. [online] Available at: [Accessed 09 October 2021].

National Grid (2021b). What is hydrogen? [online] Available at: [Accessed 09 October 2021].

Petrofac (2021). The difference between green hydrogen and blue hydrogen. [online] Available at: [Accessed 03 December 2021].

PwC (2021). The green hydrogen economy – Predicting the decarbonisation agenda of tomorrow. [online] Available at: [Accessed 22 December 2021].

Statkraft (2021). Green Ammonia: Clime Friendly Fuel for Long Distances and Heavy Tasks. [online] Available at: Green ammonia: Climate-friendly fuel for long distances and heavy tasks ( [Accessed 20 October 2021].

U.S. Department of Energy (2021). Hydrogen Production: Electrolysis. [online] Available at: [Accessed 18 October 2021].

Vickers, J., Peterson, D. & Randolph, K. (2020). ‘Cost of Electrolytic Hydrogen Production with Existing Technology’, DOE Hydrogen and Fuel Cells Program Record, Department of Energy United States of America, September 2020.

Wang, A., Jens, J., Mavins, D., Moultak, M., Schimmel, M., Leun, K., Peters, D. & Buseman, M. (2021). ‘Analysing future demand, supply, and transport of hydrogen’, European Hydrogen Backbone, Guidehouse, June 2021.

Wijk, A. V. & Chatzimarkakis, J. (2020). ‘Green Hydrogen for a European Green Deal – A 2x40 GW Initiative’, Hydrogen Europe, March 2020.

Wood Mackenzie (2020). Hydrogen production costs to 2040: Is a tipping point on the horizon? [online] Available at: [Accessed 22 December 2021].

Zumdahl, S. S. (2020). Ammonia – Chemical Compound. [online] Available at: ammonia | Definition & Uses | Britannica. [Accessed 20 October 2021].

bottom of page