Which factors dominate the levelized costs of subsurface hydrogen storage in Pennsylvania, United States

The transition to a hydrogen future in the US will be driven by the demand for low-carbon energy carriers and enabled by the development of a robust hydrogen supply chain. Storing large quantities of hydrogen in the subsurface will likely be vital to this process. Two potential options to develop underground hydrogen storage (UHS) facilities are to repurpose existing subsurface gas storage facilities or to build new facilities. Regardless of the option chosen, the technoeconomics of UHS are not yet well understood. In this paper, we developed a technoeconomic analysis approach and applied it to a dataset of the technical characteristics of the existing underground natural gas storage facilities in the Commonwealth of Pennsylvania. The estimated levelized cost of hydrogen storage calculated for developing a new depleted hydrocarbon site ranged from $0.73 to $1.29/kg, while the cost to convert an existing site within PA’s size range was 67%–99% of a new facility and ranged from $0.72 to $0.88/kg H2. The highest LCHSs are for the Pennsylvania UHS facilities with the smallest capacities, but costs decrease as storage capacity increases only up to 1 Bcf. If cushion gas could be procured from a cheaper source, the median LCHS could be reduced by 36%. If an onsite electricity generation source, like solar or wind, is available to supplement electricity required and the overall price of electricity could be reduced by 50%, the LCHS could be reduced by 11% for a newly constructed storage site and 29% at a repurposed underground gas storage (UGS) site. Our results suggest that if existing UGS facilities in Pennsylvania were converted to store pure H2 rather than natural gas, approximately 88% of the state’s need for annual H2 demand buffering in 2050 might be satisfied given that those facilities operate like current UGS facilities. •The costs of hydrogen storage were found to vary by size and depth of reservoirs.•The major costs drivers included the costs of surface equipment and electricity.•Hydrogen stored in existing UGS sites in PA can cover its 88% of demand in 2050.