Green Hydrogen for Process Steam:
5.40 ct/kWh Cheaper Than Natural Gas
A turnkey concept shows how industrial companies can switch their steam generation from natural gas to green hydrogen — with an internal rate of return of 16.22% and a cumulative advantage of 25M EUR over 20 years.
Electrolysis Capacity
1,000 kW
Steam Output
1,200 kg/h
Savings vs. Natural Gas
5.40 ct/kWh
Internal Rate of Return
16.22%
Natural Gas Dependency in Process Industry
Numerous industrial companies in Germany rely on natural gas for their process steam generation. Rising gas prices, CO₂ pricing through the EU ETS, and growing ESG pressure from investors and customers increasingly make this dependency a risk factor. At the same time, many companies face the question: How can the decarbonization of heat supply be implemented economically?
Conventional steam generation with natural gas currently costs around 16.47 ct/kWh — with an upward trend. Added to this are regulatory uncertainties and dependence on geopolitically volatile supply chains. For energy-intensive industries such as chemicals, paper, food and pharmaceuticals, this is a strategic problem.
System overview: PV → Electrolysis → H₂ Storage → Steam Generator
Why Previous Alternatives Fall Short
Previous approaches to decarbonizing steam generation — such as direct electrification with electrode boilers or biomass — each have limitations: electrode boilers require high connection capacities and are uneconomical with fluctuating electricity prices. Biomass is logistically complex and not sufficiently available in many regions. Hydrogen was long considered too expensive — but cost developments in electrolyzers and the expansion of renewable energy are fundamentally changing this equation.
Cost Comparison: Natural Gas vs. Hydrogen
Green Hydrogen: From Electricity to Steam
The concept combines photovoltaics and green electricity (PPA) with a hydrogen electrolysis plant. The produced hydrogen is stored intermediately and converted to process steam in an H₂ steam generator. The decisive advantage: the existing steam infrastructure remains — only the burner is replaced. Natural gas serves as backup for peak loads.
Green Power Generation
Photovoltaics and/or green power PPA supply the electricity for electrolysis. Dynamic operation optimally utilizes fluctuating feed-in profiles.
Hydrogen Electrolysis
The 1,000 kW electrolysis plant (Alpha EL) converts water into green hydrogen. The waste heat is used for preheating processes — maximum efficiency.
H₂ Storage & Steam Generation
The hydrogen is stored in pressure tanks and converted on demand in the H₂ steam generator to up to 1,200 kg of process steam per hour.
Turnkey Solution from a Single Source
Technology partner schrand.energy delivers with the Alpha EL system a modular, scalable complete solution — from the electrolyzer to the H₂ storage to the steam generator. The container-based design enables fast installation and flexible expansion.
Electrolyzer + Peripherals
Water treatment, drying, power electronics — all integrated
H₂ Tank & Battery Storage
Pressure storage for flexible steam generation, battery for grid stability
Energy Management
Fully automated control, grid-serving operation, waste heat extraction
Safety & Certification
Comprehensive safety concept, all relevant standards met
Alpha EL System — modular container solution by schrand.energy
25M EUR Advantage Over 20 Years
The economic calculation is based on a 1,000 kW electrolysis with 5,800 operating hours of the steam generator per year. The comparison with conventional natural gas steam generation shows a clear economic advantage — and this without considering rising CO₂ prices and possible subsidies.
System Parameters
Economic Results
Cumulative Advantage After 20 Years
approx. 25M EUR
over 20 years
Cumulative financial advantage over 20 years
More Than Just Cost Savings
Supply Security
Independence from natural gas suppliers and geopolitical risks. Own hydrogen production with local green electricity creates planning security.
ESG Compliance
Green hydrogen eliminates CO₂ emissions in steam generation. A strong signal to investors, customers and regulators — and a competitive advantage in ESG ratings.
Subsidy Eligibility
Hydrogen projects benefit from EU and federal funding programs (IPCEI, KfW, BAFA). The funding landscape is dynamically developing in favor of green H₂ projects.
Scalability
The modular container design allows step-by-step expansion. Today 1 MW electrolysis, tomorrow 5 MW — without rebuilding the existing steam infrastructure.
Transferable Insights
This case study shows that green hydrogen for industrial steam generation is not only ecologically sensible but already economically attractive today. The key insights are transferable to comparable industrial sites:
Hydrogen steam generation is already more economical at current natural gas prices — break-even is at 3–4 years.
The conversion only requires a burner replacement — the existing steam infrastructure remains fully intact.
Waste heat utilization from electrolysis significantly increases overall efficiency and improves the business case.
Dynamic operation of the electrolysis optimally utilizes fluctuating electricity prices — an advantage over rigid consumers.
The entrepreneur-for-entrepreneur approach connects technology partners with strategic consulting — and finds solutions that planners alone often don't see.
Technology Partner: schrand.energy
schrand.energy specializes in turnkey hydrogen electrolysis plants (Alpha EP / Alpha EL) for industrial applications — from planning through installation to operation.
Decarbonize Steam Generation?
Let us check in a non-binding sparring session whether green hydrogen is also the most economical solution for your site.