Techno-Economic Assessment of Hydrogen Production from Curtailed Wind Energy: A Case Study in La Guajira, Colombia

Abstract

Wind energy is essential for climate change mitigation, but its intermittency poses challenges for grid integration. Curtailment can occur when electricity supply exceeds demand or transmission capacity, especially in the absence of storage. Converting surplus electricity to hydrogen maximises renewable energy use and supports CO₂ emission reductions. This study conducts a techno-economic assessment of converting curtailed wind power into hydrogen under hypothetical wind development scenarios in La Guajira, Colombia, and compares this approach to hydrogen production from a dedicated wind farm. The analysis is carried out using a Python-based modelling approach. Hydrogen transport and storage costs are out of the scope. Assuming surplus electricity is available at zero cost, curtailment-driven hydrogen is cost-competitive at a reference price of €3/kg and scenarios with higher curtailment show the most favourable outcomes. The levelised cost of hydrogen (LCOH) ranges from €1.5-€2.2/kg, annualised benefits between €13.8-178 M/y and avoided emissions of 0.18-1.3 MtCO2/y. However, not all surplus energy can be economically converted to hydrogen, as it would require larger electrolysers to handle power peaks, increasing costs. As a result, some curtailment would remain. When surplus electricity is valued at its levelised cost of energy (LCOE), the LCOH increases to €3.4–€3.9/kg at a 100 MW electrolyser capacity, exceeding the reference hydrogen price. In this context, the dedicated wind farm offers a more competitive alternative, achieving an LCOH of €2.6/kg, annualised benefits of €10.9 M/y, and 0.28 MtCO₂/y of avoided emissions. This advantage stems from more consistent power output, which enables higher electrolyser utilisation and allows for a smaller, more cost-effective system size, and also from the wind farm’s relatively high-capacity factor of 49%. In contrast, curtailment-driven scenarios face peaks and extended periods without surplus energy, requiring larger electrolysers that operate at lower utilisation rates. In such cases, cost-effectiveness is primarily achieved under conditions of high curtailment, combined with an electrolyser CAPEX of €265/kW and a hydrogen price of €4/kg. In curtailment-driven hydrogen production, interannual variability—caused by wind speed patterns—can reach ±50% of the mean, compared to ±29% for the dedicated wind farms. Moreover, the dedicated wind farm is more cost-competitive across a wider range of conditions, including electrolyser CAPEX, hydrogen prices, and turbine costs. Overall, the findings indicate that while using curtailed electricity can complement wind farms in La Guajira, its cost-effectiveness is limited under realistic electricity cost assumptions. To make this strategy competitive, policy support—such as incentives or subsidies—will likely be required.