Hydrogen Sources - Hydrogen and Fuel Cells: Advances in Transportation and Power - page 116

Water is the source of hydrogen for the electrolysis process. Decom-
posing water into hydrogen and oxygen using electricity is a mature tech-
nology widely used around the world to generate very pure hydrogen.
But, it is energy intensive and the faster you generate the hydrogen, the
more power that is needed per kilogram produced. Commercial electroly-
sis units need almost 50-kWh per kilogram, which represents an energy
efficiency of 70%. This means that more than 1.4 units of energy must be
provided to generate 1 energy unit in the hydrogen.
Most electricity comes from fossil fuels, and the average fossil fuel
plant is about 30% efficient, then the overall system efficiency is close to
20% (70% times 30%). Almost five units of energy are needed for every
unit of hydrogen energy produced.
Larger electrolysis plants are cheaper to build per unit output and
they would provide a lower price for electricity generation than smaller
ones at local filling stations. These smaller plants are sometimes called
forecourt plants since they are based where the hydrogen is needed.
Hydrogen can be generated at off-peak rates, but that is easier to do
at a centralized product facility than at a local filling station, which must
be responsive to customers who typically do most of their fueling during
the day and early evening, the peak power demand times. To circumvent
peak power rates, the National Renewable Energy Laboratory (NREL)
suggests that forecourt plants would need large oversized units operated
at low utilization rates with large amounts of storage. This would require
additional capital investment. It is estimated that the cost of producing
and delivering hydrogen from a central electrolysis plant is $7-$9/kg. The
cost of production at a forecourt plant could be $12/kg.
High cost is probably the major reason why only a small percent-
age of the world's current hydrogen production comes from electrolysis.
To replace all the gasoline sold in the United States today with hydrogen
from electrolysis would require a doubling of the electrical power that is
sold in the United States at the present time which is about 4 trillion kW.
HYDROGEN USE
Hydrogen use is continuing to grow in the United States, building
a national core competence in hydrogen applications. It is used as an in-
dustrial chemical, an energizing additive to fossil fuel, a coolant and an
aerospace fuel. Hydrogen is the lightest and most abundant element in