D3.1 Case studies of interest regarding risks and uncertainty in the hydrogen value chain

The scope of WP3 within the HyDelta project is to identify – together with stakeholders – risks, uncertainties, and collaboration opportunities that are crucial to understanding deployment strategies and policy in the hydrogen value chain, in particular:

• (Quantifiable) risks and (unquantifiable) uncertainties to market participants, including OPEX risk, price risk, macro-economic systemic risks, regulatory risks, and uncertainties
• Uncertainty and risks to policy makers at various levels, including local and national authorities
• Collaboration opportunities, needs and mechanisms for the sharing of revenues between collaborating parties, as well as the sharing of risk.

The purpose of the current report is to provide a more detailed scope. An initial list of risks and uncertainties has been identified through two stakeholder workshops, and is reported in this document. These risks span a wide range. Many of the key risks to individual actors are related to value chain coordination (e.g., demand, supply or storage not materializing at the same time, leading to a disconnected value chain), but there are also important risks related to the availability of key inputs (materials, but especially labor), wider economic factors, policy and regulation. Although we were able to flag some risks as particularly important, this is based on an initial analysis only, so these assessments may change after a full quantification. For some risks, there is less consensus. Several uncertainties and risks were identified in this stage of the research.

The outlined uncertainties and risks are clearly different for different types of hydrogen value chains, e.g., combined offshore wind and hydrogen production at source, backbone-connected large-scale production and industrial  use of hydrogen, and  local production of hydrogen with distributed take-off. Accordingly, three different case  studies have been identified to quantitatively assess the risks and uncertainties. We also outline different collaboration mechanisms which can help address these risks. These will be quantitatively analysed in the case studies, using a set of three energy system models which simulate the energy system at different geographical and timescales to capture a wide range of risks and uncertainties.