Open Collections

Cost optimization of hydrogen fuel supply chain with environmental policy integration: the case for British Columbia

University of British Columbia

By powering fuel cell electric vehicles hydrogen can contribute to greenhouse gas emissions reduction in British Columbia (B.C.) The province is well positioned to capitalize on its natural resources and policies towards the development of a hydrogen fueling supply chain (HFSC). However, such development requires significant investment with high risks of negative cash flow for years to decades. A spatially explicit multi-period optimization model was developed to design a minimum-cost HFSC based on a mixed integer linear programming formulation. The model was applied to the light duty passenger vehicle sector in B.C. under three hydrogen demand scenarios. The model considered different capacities for all components of the supply chain, covered the on-site production and capacity expansion options as well as minimum storage requirement for fueling stations. Different combinations of the current and potential environmental mandates and the government economic instruments were integrated in the model explicitly. The model measured the effectiveness of the policies on reducing the cost and greenhouse gas (GHG) emissions of the HFSC for each demand scenario. To this end, the GHG emissions were monetized using the social cost of carbon. The results suggested that hydrogen can be cost competitive with gasoline. However, the cost optimal hydrogen infrastructure relied heavily on steam methane reforming (SMR), with small GHG emissions reduction benefits. Nonetheless, the monetary benefits of well to wheels (WTW) GHG emissions reduction justified the switch from gasoline to SMR-based hydrogen. It was found that central electrolysis can be financially justified by addition of production tax credits or electricity incentives to the current provincial carbon control policies (i.e., carbon tax and low carbon fuel standard). This study assessed the effectiveness of current policies in emissions mitigation from the road freight transport. Moreover, the WTW energy requirement and GHG emissions reduction potential of the all-electric trucking were measured to meet the provincial emissions reduction targets. The results suggested that the B.C. hydroelectricity will fall short of generating sufficient energy to support all-electric trucking. Thus, B.C. has to undertake policies to incentivize electricity generation from diversified renewable energy resources.

Text

2020-07-16

Attribution-NonCommercial-NoDerivatives 4.0 International

http://hdl.handle.net/2429/75193

Mechanical Engineering

University of British Columbia

UBCV

http://creativecommons.org/licenses/by-nc-nd/4.0/