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 ■ Date: Sep 18, 2020
【Analysis of Hydrogen Transportation Cost in China】
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Hydrogen refueling station is a very critical part of the hydrogen energy strategy. With its hydrogen fuel reserve radiating the surrounding areas, fuel cell vehicles can replenish energy in time. The technologies of hydrogen production, storage and transportation, etc. will all affect whether the hydrogen used in fuel cells can be obtained conveniently, quickly and at low cost. 
From the cost perspective, this article mainly analyzes the economics of hydrogen transportation for gaseous and liquid hydrogen. 
1. Gas-hydrogen trailers will still be the main mode of transportation of hydrogen in the near future.
  • Cost is mainly related to driving mileage.
  • Based on the transportation distance of about 200km and the transportation scale of 5 tons/day, the hydrogen cost range is around 8.0 RMB/kg. The cost will be over 10 RMB/kg when the transportation scale of less than 1 tons/day which is clrealy not economical
2. Cryogenic hydrogen transportation is promising method in the future. With its transportation capacity more than 10 times that of gas-hydrogen trailers, and large-scale hydrogen production potential from renewable energy curtailment, cryogenic hydrogen is expected to transport hydrogen in large scale  and for long distance .
  • Liquefaction process (equipment investment and powe consumption cost) contribute most for the hydrogen transportation costs. 
  • With a scale of 5 tons/day, the transportation price is less sensitive to driving range. The price is stable around 11-15 RMB/kg.
3. INTEGRAL’s Suggestion: 
  • Increase hydrogen loading weight (higher compression pressure, 20MPa --> 40MPa)
  • Operation optimization so as to ameliorate the usage of trailers
  • Increase hydrogen refueling efficiency (for example, decrease refueling time from 5h to 3h; deploy swapping mode, etc.)
  • Decrease fixed cost (financial leasing, extend equipment utilization period, etc.)
1. Gaseous Hydrogen
Gaseous hydrogen is generally transported via tube trailers, which travels between the hydrogen plant and hydrogen refueling stations.
The operation process of hydrogen tube trailer transportation is simplified as follows:
    1) The empty-load tube trailer is hydrogenated to full load in hydrogen production plant , and then drives to the hydrogen refueling station.
    2) Long tubular storage cylinders are unloaded from tube trailer and left in hydrogen refueling station as the storage equipment directly.
    3) Empty cylinders are picked up and transported back to the hydrogen plant for a new round of loading.
According to the actual situation, we made some assumptions:
Figure 1 Assumption for projecting gaseous hydrogen transportation cost via tube trailer
Reference: Integral Report
Figure 2 Cost breakdown for gaseous hydrogen transportation via tube trailer (Beijing, 20MPa, 1000 & 5000kg/day)
Reference: Integral Report
Term explanation:
    [Mileage cost]: cost related to fuel consumption during the transportation period.
    [Vehicle cost]: include insurance, maintenance and toll expense.
   [Labor cost]: wage of necessary personnel, including tube trailer driver and operator for the loading and onloading of hydrogen
    [Equipment depreciation]: the depreciation of fixed assets, such as truck head, tube, compressor, etc.
    [Compressor electricity]: cost related to the compression process of hydrogen using electricity
Transportation cost of high-pressure gas is  clearly proportional to the driving range  (Figure 2). The cost get doubled when driving rage doubles.   The "jump" in transportation cost comes from the increase of required amount of tube trailers, which is related to mileage, equipment depreciation, vehicle as well as labor cost. When the transportation volume is small (e.g. 1000 kg/day), this increase is large compared with total cost, while for larger tranportation volume, this increase is proportionally smaller and the graph looks more smoother.
There are some scale merit to compress fixed cost as daily transportation volume increase, but the effect is negligible over  5,000 kg/dayMileage, equipment, vehicle,  and  labor cost  are major cost factors, and are variable to the transportation volume.
Based on the transportation distance of about 200km and the transportation scale of 5 tons/day, the hydrogen cost range is around 8.0 RMB/kg (Figure 5), meanwhile the cost will be over 10 RMB/kg when the transportation scale is less than 1 tons/day (currently most of the HRS in China has daily hydrogen demand of less than 1 tons), which is clearly not economical. So far, the cost of hydrogen supply is still relatively high. The average hydrogen procurement cost of domestic hydrogenation stations is 35-45 RMB, while in some hydrogenation stations, such as Foshan City, Guangdong Province, the cost is even higher than 50 RMB of which significant portion of the cost is occupied by the transportation cost. However, the retail price of hydrogen needs to be reduced to 30 RMB in order to keep pace with the price of the other energy sources (i.e. diesel fuel of ICEV). Thus, the transporation cost of high-pressure gas is currently a bottleneck of establishing economical hydrogen supply chain. Given above analysis, some measures could be taken to reduce the cost:
  • Considering that the main contributors of tranportation cost are related to vehicle and personnel expediture, we suggest the optimization of operation management. For example, make full use of the trailers and operators according to the transportation volume. Improved technologies and skills might make the refueling more efficient, for example, by decreasing refueling time from 5h to 3h or by deploying swapping hydrogen storage vessel mode, etc. These effort will reduce the required number of tube trailers for the transportation and thus reduce the cost of mileage, vehicle, and labor cost.
  • Find ways to decrease fixed cost.  For example, using financial leasing, or extend equipment utilization period, etc.
  • Increase hydrogen loading weight by applying higher compression pressure (i.e. 20MPa --> 40MPa), which also reduce the required number of tube trailers
2. Cryogenic Hydrogen
Liquid hydrogen is stored in specially insulated cryogenic tanks under pressure, which have provisions for cooling, heating, and venting. In liquid state, cryogenic hydrogen has a density nearly twice that of compressed hydrogen at 70 MPa. 
However, liquefaction is an energy-intensive process. The power consumption of liquefying hydrogen with the same calorific value is more than 11 times higher than that of hydrogen compression. In addition, the material and technology requirement of liquid hydrogen storage tank are higher, thus increasing the initial investment cost.
Figure 3 Assumption for projecting cryogenic hydrogen transportation cost via trailer
Reference: Integral Report
Figure 4 Cost breakdown for gaseous hydrogen transportation via tube trailer (Beijing, 1000 & 5000kg/day)
Reference: Integral Report
Unlike high-pressure gas, cryogenic hydrogen transportation cost is not sensitive to the driving range (Figure 4 ). According to our calculations, the costs related to the liquefaction process (equipment investment and power consumption costs) contribute most for the hydrogen transportation costs, reaching 70%-85% (vary with the transportation distance). Due to the strong scale effect of the liquefaction equipment, compression cost accounts for higher ratio with the increase of the transportation scale. Since the compression electricity cost is fixed depending on the volume, unit distance transportation cost (RMB/day/km) will decrease as the transportation distance increases.
Compared with high-pressure gaseous hydrogen, larger transportation and longer transportation distance will be factors that favor the development of cryogenic hydrogen. Actually, we could get a glimpse of the trend that cryogenic hydrogen is gaining more interest:
  • There are more and more civil projects other than previously prevailing military projects for the production and application of cryogenic hydrogen. (For details, please see our blog " Overview of Hydrogen Storage Technolocy in China ")
  • The standardization work has also been carried out, as 3 national standards regarding liquid hydrogen production, storage, and transportation safety are currently under final evaluation and are expected to put into effect in mid 2020. The release of these standards will fill the gap in civil liquid hydrogen sector and will accelerate its application in large scale.
With the expansion of project scale and project number, it is foreseeable that the cost of liquid hydrogen transportation will be reduced and the economy of scale will be further optimized. This in turn can also create a virtuous circle, which encourages more projects to use liquid hydrogen transportation.
【Comparison Gaseous VS. Cryogenic hydrogen transportation 】
When considering the average cost (cost per kg transported hydrogen), it can be inferred that:
1) For the same method, as transportation volume increases, average cost decreased and, due to scale effect, approach its theoretical limit.
2) For the same method, as transportation volume increases, the curve of high pressure gaseous hydrogen becomes smoother. The sudden "surge" comes from additional truck. Larger transportation volume brings larger total cost meanwhile the cost brought by the extra truck is proportionally smaller. 
3) The breakpoint of two methods exits and as the tranportation volume increase, the breakpoint decrease and stablize around 300-350km. Below this distance, gaseous hydrogen (with 5 tons/day) is more economical; whereas for longer distance, cryogenic hydrogen might be considered as a more economonical way for the transportation.

Figure 5 Comparison of average transportation cost of two methods (Beijing, 1000, 5000 & 10000kg/day)
Reference: Integral Report
【Future outlook】
- High-pressure gaseous hydrogen transportation has pricing advantages in short distance, usually a distance below 300km that correspond to the transportation within city is more suitable.
- On the contrary, for larger scale and longer distance, cryogenic hydrogen will be more economic option. Since we envision that with the development in hydrogen industry, there will be more demand and supply imbalance across regions and therefore RE, a promising hydrogen production method, requires inter-province or inter-city transportation. In this scenario, it is more realistic to use cryogenic hydrogen.
- In the future, a combined tranportation method might also be used to optimize total transportation cost. For example, for the cryogenic hydrgen can be used for bulk transportation from the region where RE-curtailed generated hydrogen is produced to the hub stations or level I stations in demand provinces/cites. Hydrogen will be divided in small portion into storage tubes and transported via tube trailers to different sub-stations across the city.
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