The impact of temporal hydrogen regulation on hydrogen exporters and their domestic energy transition

Abstract

Abstract As global demand for green hydrogen rises, potential hydrogen exporters move into the spotlight. While exports can bring countries revenue, large-scale on-grid hydrogen electrolysis for export can profoundly impact domestic energy prices and energy-related emissions. Our investigation explores the interplay of hydrogen exports, domestic energy transition and temporal hydrogen regulation, employing a sector-coupled energy model in Morocco. We find substantial co-benefits of domestic carbon dioxide mitigation and hydrogen exports, whereby exports can reduce market-based costs for domestic electricity consumers while mitigation reduces costs for hydrogen exporters. However, increasing hydrogen exports in a fossil-dominated system can substantially raise market-based costs for domestic electricity consumers, but surprisingly, temporal matching of hydrogen production can lower these costs by up to 31% with minimal impact on exporters. Here, we show that this policy instrument can steer the welfare (re-)distribution between hydrogen exporting firms, hydrogen importers, and domestic electricity consumers and hereby increases acceptance among actors.