Investment feasibility of green hydrogen production from geothermal electricity: Navigating uncertainty with exploratory financial modeling and analysis
Penulis: AD Setiawan, S Marthen, MP Dewi, AO Moeis, A Hidayatno
Informasi
JurnalInternational Journal of Hydrogen Energy
PenerbitInternational Journal of Hydrogen Energy, 2025, Elsevier Ltd
Tahun Publikasi2025
ISSN03603199
Jenis SumberGoogle Scholar
Sitasi
Scopus: 1
Google Scholar: 1
PubMed: 1
Abstrak
Green hydrogen is increasingly recognized as a vital enabler of deep decarbonization; however, its economic viability remains uncertain, particularly in emerging markets like Indonesia. This study assesses the investment feasibility of green hydrogen production from geothermal electricity under uncertainty, employing an exploratory financial modeling and analysis approach. Key indicators such as net present value, internal rate of return, payback period, and levelized cost of hydrogen are used to assess feasibility. The analysis, which utilizes the scenario discovery technique, reveals that investment outcomes are most sensitive to the cost of electricity (COE), the debt-to-capital ratio, and the discount rate. Results are robust when COE stays below median thresholds, debt levels are moderate, and discount rates are under 10%. However, securing a payback period of less than seven years remains challenging under current assumptions. Two options are further analyzed: utilizing excess geothermal electricity, which improves competitiveness if allocation is reliable and costs are lower than current tariffs; and purchasing electricity from the state electricity company, which provides supply stability but raises operating costs—therefore requiring favorable conditions. Overall, the findings suggest that green hydrogen production from geothermal electricity offers promise for supporting Indonesia's energy transition; however, large-scale deployment will depend heavily on competitive electricity prices, a sound financial structure, and stable investment conditions. © 2025 Hydrogen Energy Publications LLC
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