Source
http://web.archive.org/web/20210129080421/http://www.concept.co.nz/uploads/2/5/5/4/25542442/h2_report1_summary_v4.pdf — original source (opens in a new tab; the file is not redistributed)
Concept Consulting (2019) — Hydrogen in New Zealand, Report 1 (Summary)
NZ energy-consultancy techno-economic study (Concept Consulting Group Ltd; sponsored by Contact, Meridian, Powerco, First Gas, MBIE, EECA) assessing whether hydrogen has a role in decarbonising the NZ economy or as an export opportunity. Establishes NZ green-hydrogen production-cost reference estimates — headline
8.91/kg NZD** today for bulk-storage production (85% capacity-factor large-scale electrolysis; =63/GJ =0.23/kWh), a full Table-1 matrix by use case (6.80–12.56/kg current), and a **hydrogen-from-hydrocarbons (SMR+CCS) estimate of2.7/kg. All values are NZD.⚠ Its load-bearing NI/thesis finding is that green hydrogen is unlikely to be cost-competitive with direct uses of electricity (EVs, electric process-heat boilers, heat pumps) for most applications at any carbon price, because of large process losses (≈3× the renewable electricity of an EV; ≈2× a heat-pump boiler; ≈6× a heat-pump space heater) — hydrogen’s viable niches are remote off-grid locations, 24/7 return-to-base freight, and high-carbon-price seasonal/dry-year peaking. ⚠ This is the SUMMARY report; Report 2 (full technical analysis) and Report 3 (background) are not held. The “14 NZD/kg” figure LIT_033 attributes to this source is NOT in this Summary (see Notes).
Summary
Concept Consulting’s Hydrogen in New Zealand, Report 1 – Summary (Jan 2019) is the summary volume of a three-report study, sponsored by two generators (Contact, Meridian), two network/gas companies (Powerco, First Gas) and two government agencies (MBIE, EECA), examining hydrogen’s potential role in decarbonising the NZ economy and as an export product. The analysis centres on green hydrogen (renewable electricity → electrolysis → water-split H₂) but also covers hydrogen-from-hydrocarbons (steam-methane reforming with carbon capture and storage, SMR+CCS). It builds reference production-cost estimates (present-day and projected 20 years out) and then tests hydrogen’s competitiveness against direct-electric and other low-carbon alternatives across four end uses — heavy transport, industrial process heat, household space/water heating, and utility-scale power generation — plus the export case (principally to renewables-poor Japan/South Korea).
The headline present-day green-hydrogen reference cost is 8.91/kg (NZD), including tank storage** (= 63/GJ = 0.23/kWh), of which electricity is >75% and equipment ~a quarter. Table 1 gives a full current/future cost matrix by use case (current: gas-injection 6.80–7.57, bulk storage 8.91, service-station 11.30, off-grid bulk storage 12.56 /kg). SMR+CCS is estimated at **2.7/kg (19/GJ) at a 100/tCO₂ carbon price. Across every mass-market end use the study finds hydrogen loses to direct electrification (battery-electric vehicles, electric/heat-pump heating, electric process-heat boilers) because of the compounding electrolysis/compression/storage losses and capital costs — no carbon price reverses this for process heat, and gas→hydrogen home heating only turns economic at 650/tCO₂. Hydrogen's surviving niches are **remote off-grid supply**, **return-to-base freight**, and **seasonal/dry-year peaking generation at high carbon prices** (underground Ahuroa storage could compete with gas at ~200/tCO₂ on fuel cost alone, but non-fuel factors push this much higher). This is the primary source behind the $8.91 NZD/kg-H₂ benchmark cited in LIT_033 (whose own off-grid design achieves 6.97 NZD/kg) and underpins the NZ hydrogen-framing sources CR_040 / CR_042 / OT_081 already in the corpus.
Key claims
- claim: "Reference estimate for producing green hydrogen in New Zealand today is $8.91 per kg, including the cost of storage in a tank. For comparison with other fuels, $8.91 per kg translates to $63 per GJ or $0.23 per kWh. For reference the wholesale cost of natural gas is currently $6/GJ and the wholesale cost of electricity is approximately $0.075/kWh. [All values NZD.]"
source_location: "Section 3.1 Green hydrogen, printed p.6"
- claim: "Cost-component split of the $8.91/kg green-hydrogen reference estimate: electricity (wholesale + network) makes up more than 75% of the cost of production; equipment (electrolyser + storage capital & operating) makes up nearly a quarter; the reference assumes a relatively large-scale facility accessing wholesale electricity and commercial network rates, on-site short-term bulk storage, and an 85% capacity factor. Process losses assumed: 30% at electrolysis and 10% at compression (for storage)."
source_location: "Section 3.1 Green hydrogen, printed p.6"
- claim: "Table 1 — Projected hydrogen production costs ($/kg NZD), by use case, columns [Current | Future Opportunistic | Future Large-scale]: Gas Dx injection 7.57 | 2.97 | 5.93; Gas Tx injection 6.80 | 2.67 | 5.33; Bulk storage 8.91 | 4.65 | 6.94; Service station 11.30 | 6.55 | 9.11; Off-grid bulk storage 12.56 | 9.22 | 9.22. [Table source note: Tech_Eval_v05.xlsm. The highest CURRENT figure is off-grid bulk storage 12.56 $/kg; no figure of 14 $/kg appears in Table 1.]"
source_location: "Table 1 'Projected hydrogen production costs ($/kg)', printed p.7 (embedded image; transcribed from rendered page)"
- claim: "Future-cost assumptions (20 years out): a highly renewable electricity supply causing prices to collapse in abundant-production periods, with hydrogen production targeting only those low-price ('opportunistic') periods; more cost-reflective future network tariffs; and worldwide equipment scale-up delivering electrolyser and storage capital-cost reductions of 50% and 40% respectively. Caveat: low-cost 'opportunistic' production only works if hydrogen is a small share of demand — large-scale production drives the need for new renewable generation, raising the electricity-cost component."
source_location: "Section 3.2 Future Green Hydrogen, printed pp.6–7"
- claim: "Hydrogen from hydrocarbons (steam methane reforming): reference estimate of $2.7 per kg ($19 per GJ), assuming very large-scale production with carbon capture and storage (CCS), excluding hydrogen storage costs (production fed straight into a transmission pipeline). Assumes a carbon cost of $100 per tonne CO2 (CCS is uneconomic at a low carbon price) and that CCS removes only 75% of CO2, with the balance attracting an emissions obligation. Using hydrocarbons could be lower cost than green hydrogen for carbon prices up to the $500–600/tCO2 range."
source_location: "Section 3.3 Hydrogen from Hydrocarbons, printed p.8; key finding 7, printed p.3"
- claim: "Overall competitiveness finding: in most cases hydrogen is unlikely to become cost-competitive with more direct uses of electricity (electric vehicles, electric process-heat boilers, heat pumps), because direct-electric options have significantly lower process losses — almost three times more renewable energy is required to power a hydrogen vehicle than an electric vehicle, and approximately twice as much renewable energy to fuel a hydrogen boiler/heater than an electric boiler or heat pump. Hydrogen's competitive niches are 24/7 on-site freight-loading operations, remote off-grid locations, and (at high carbon prices, likely over $300–400/tCO2) firing gas turbines for peak or seasonal generation."
source_location: "Key findings 4, 4a, 5, 6, printed pp.2–3"
- claim: "Heavy transport: heavy battery-electric trucks (EVs) currently cost 45% more than diesel trucks and heavy hydrogen trucks (HVs) cost 180% more; projected 20-year capital-cost penalties relative to diesel fall to 10% (EV) and 45% (HV). Future EV fuel costs are projected to be less than a third of the fuel costs for diesel and hydrogen vehicles. The heaviest battery-electric trucks are assumed to suffer an ~18% productivity penalty (unproductive recharging downtime + battery-weight payload loss), rising to 38% for vehicles travelling twice the average annual distance — but this affects less than 30% of heavy-freight fuel consumption and ~5% of NZ transport emissions."
source_location: "Section 4.1 Transport, printed pp.9–10"
- claim: "Industrial process heat (focus: intermediate steam-raising 100–300°C, very large boilers, at $100/tCO2): gas remains competitive where available even at $100/tCO2; coal is starting to become uneconomic vs direct-electric and biomass; green hydrogen is NOT projected to be competitive relative to direct-electric and biomass, and there is no carbon price which will alter this evaluation. Twice as much primary renewable electricity is required to power a hydrogen-electrolyser-fuelled boiler as an electric boiler."
source_location: "Section 4.2 Industrial process heat, printed pp.11–12"
- claim: "Space and water heating (household scale; direct fossil use = 4–5% of NZ greenhouse-gas emissions): a changeover from natural gas to hydrogen does not become economic until carbon prices reach $650/tCO2, whereas switching from gas to an electric heat pump is economic at much lower carbon prices. Heat-pump efficiency can be as high as 350% (space heating) and 130% (water heating) vs up to 90% for a condensing boiler; almost six times as much renewable electricity is required to heat a home with green hydrogen as with a heat-pump space heater (just over twice as much for water heating). Hydrogen can be blended into existing gas pipelines only up to around 10% before a full changeover is required."
source_location: "Section 4.3 Space and water heating, printed pp.13–14"
- claim: "Power generation (14% of NZ emissions in 2016; ~half from baseload fossil plant, ~half from firming/seasonal/peaking plant): the most plausible hydrogen niche is storing low-price-period energy to power higher-price peaking generation. Ammonia storage is relatively expensive (~$50 per GJ), needing a very high carbon price of ~$750/tCO2 to compete with natural gas. Underground storage (Ahuroa) is less costly and on fuel cost alone could compete with gas at a carbon price as low as $200/tCO2 — but non-fuel factors (turbine re-powering, reservoir bacteria treatment/compressor upgrades, and hydrogen's lower volumetric energy density reducing Ahuroa's energy-storage capacity to less than a third of its natural-gas capacity) push the threshold much higher, so hydrogen turbines may struggle vs biomass or over-building renewables."
source_location: "Section 4.4 Power generation, printed p.14"
- claim: "Export: the delivered cost of green hydrogen produced in New Zealand and shipped to Japan could be around $44 per GJ by 2040, vs liquified-natural-gas (LNG) prices of approximately $14 per GJ — meaning NZ green hydrogen would be competitive at a carbon price of around $550/tCO2. Renewables-poor importing countries (Japan, South Korea) would face energy costs three to four times higher than renewables-rich countries going the direct-electric route. To fully decarbonise via imported green hydrogen, Japan would need to call on foreign renewable generation 125 times greater than New Zealand's own extra decarbonisation generation."
source_location: "Section 4.5 Export, printed pp.15–16; key findings 8–9, printed p.3"
- claim: "Scale-of-generation estimate: to meet its own decarbonisation requirements New Zealand will need to DOUBLE its generation (majority from wind and solar farms) via the direct-electric route, or TRIPLE it via the green-hydrogen route (owing to hydrogen's higher process losses)."
source_location: "Key finding 10a + footnote 1, printed pp.3, 6; Section 4.5, printed p.15"Neobiome Intelligence relevance
This is the primary consultancy source behind the NZ green-hydrogen production-cost benchmark that NI already carries second-hand through LIT_033, and it materially sharpens both the D01 cost data and the I01 feasibility posture. Its value is three-fold.
- NZ green-H₂ production-cost anchor, in NZD, with a full use-case matrix (D01 / hydrogen_storage). The headline
8.91/kg (=63/GJ =0.23/kWh)** is the present-day large-scale bulk-storage reference, ~75% of it electricity cost, at an 85% capacity factor. Table 1 spreads this by use case — **current6.80–7.57/kg (pipeline injection),8.91 (bulk storage),11.30 (service station),12.56 (off-grid bulk storage)**, falling in the "future large-scale" scenario to **5.33–9.22/kg. Crucially for NI, all values are NZD (NZ firm; MBIE/EECA/utility sponsors; benchmarked against NZ wholesale gas6/GJ and electricity0.075/kWh) — this is a clean-currency anchor, unlike the currency-ambiguous marine-tech costs in LIT_068. The **off-grid bulk-storage12.56/kg current** figure is the row most directly relevant to a Neobiome remote community (no network connection, lower electrolyser capacity factor, more storage) — it is the appropriate upper anchor, not the8.91 grid-connected reference. - Feasibility gate: hydrogen is a niche, not a core lever, for remote communities (I01 / D01). The study’s central conclusion — green hydrogen loses to direct electrification across transport, process heat and home heating at any carbon price, on ~2–6× worse end-to-end energy efficiency — tells NI to treat community-scale hydrogen as a seasonal / dry-year storage and remote-off-grid option, not a primary generation or heating pathway. This corroborates CR_040 (round-trip efficiency vs batteries; seasonal-storage niche), CR_042 and OT_081 (hydrogen for hard-to-electrify uses, not community storage), and the seasonal-H₂ modelling in LIT_061. Notably the report explicitly names “meeting energy demand for remote off-grid locations” as one of hydrogen’s few surviving niches — the exact Neobiome use case — which is why LIT_033’s off-grid Rakiura design uses a hydrogen chain despite these costs (and beats this benchmark at 6.97 NZD/kg with fully on-site opportunistic production).
- Carbon-price thresholds and the direct-electric efficiency multipliers (I01 / thesis). The report supplies a usable set of break-even carbon prices — home gas→H₂
650/tCO₂**, ammonia-storage peaking **~750/tCO₂, underground-storage peaking floor ~200/tCO₂** (fuel-cost only), SMR+CCS-beats-green up to **500–600/tCO₂, export-to-Japan competitiveness ~$550/tCO₂ — and the efficiency-penalty multipliers (~3× for H₂ vehicles vs EV, ~2× for H₂ boilers, ~6× for H₂ home space heating vs heat pump). These are the quantitative backbone for the thesis technology-landscape argument that direct electrification, not hydrogen, is the default decarbonisation route for a NZ remote community — with hydrogen reserved for the seasonal/off-grid residual.
Thesis angle (context: both). Beyond the NI cost cells, the report is a well-sourced NZ primary for the strategic argument that a self-sufficient remote community should electrify directly and hold hydrogen only for the seasonal-storage / dry-year niche — the same efficiency-first logic that runs through the D01 evidence cluster.
Research targets
Documents to retrieve
- RT_166 (still open on this leg) — Concept Consulting (2019) Hydrogen in New Zealand, Report 2 – Analysis (the full technical report) and Report 3 – Background Research. Report 1 (this Summary) references both as its supporting volumes. Report 2 would carry the full cost model, sensitivity ranges and the small-scale/decentralised production figures — the likely home of the “14 NZD/kg (small-scale)” figure that LIT_033 attributes to “Concept Consulting 2019” but which does NOT appear in this Summary (Table 1’s highest current figure is off-grid bulk storage
12.56/kg). Retrieving Report 2 would verify or refute the 14 figure and close RT_166's residual cost-benchmark leg. *No new RT minted — the retrieval need is carried on the still-open RT_166.* → D01, I01 → **RESOLVED:** Report 2 (Analysis) + Report 3 (Background) now ingested as [[ot_151_concept-2019-hydrogen-nz-r23|OT_151]]. Report 2's complete-model use-case matrix reproduces this Summary's Table 1 exactly (highest current = off-grid12.56/kg); the ‘14 NZD/kg’ figure is confirmed absent. RT_166 moved to Done.
Research gaps
- (No new RT — RT-list closing.) An updated, post-2019 NZ green-hydrogen production LCOE would recalibrate the 2019
8.91/kg (and12.56/kg off-grid) benchmarks against current electrolyser and electricity prices, but this recalibration is already carried by the existing residual in LIT_033’s research-gaps section (recalibrate the 6.97 / 8.91 / 14 NZD/kg figures) and partly served by the 2024-era framing in CR_040 / OT_081. No separate RT raised.
Resolved / advanced
- RT_166 — RESOLVED (doc retrieved and ingested → this page; kept OPEN on the “14” leg): Concept Consulting (2019) “Hydrogen in New Zealand, Report 1” retrieved, read verbatim and ingested. ⚠ Scope of resolution: RT_166 was raised to source the “8.91–14 NZD/kg-H₂” benchmark LIT_033 attributes to this report. The **
8.91/kg** figure is fully verified here (Section 3.1 + Table 1 bulk-storage current), **in NZD**, with its full cost-component split and a complete use-case cost matrix (6.80–12.56/kg current). The “14 NZD/kg (small-scale)” figure is NOT present in this Summary report — Table 1’s highest current value is off-grid bulk storage **12.56/kg**. The row is therefore left **OPEN and annotated** (not moved to Done): the residual 14-figure / Report 2 – Analysis leg is unresolved. Do not treat "14 NZD/kg" as verified against a primary until Report 2 is obtained. ⟶ 2026-07-19: the Report 2 – Analysis leg is now closed by [[ot_151_concept-2019-hydrogen-nz-r23|OT_151]]; the "14 NZD/kg (small-scale)" figure does NOT appear in Report 2 or Report 3 (highest current production cost = off-grid bulk storage12.56/kg). Attribution error in LIT_033; do not treat “14 NZD/kg” as verified.
Notes
Grey-literature consultancy report (Concept Consulting Group Ltd, Wellington), Hydrogen in New Zealand, Report 1 – Summary, Version 04, saved 29-Jan-2019; sponsored by Contact, Meridian, Powerco, First Gas, MBIE and EECA, but stated to represent Concept’s own analysis. source_type: other (ot_ prefix), stored in source-files/07_other/. Read verbatim via pdftotext -layout; Table 1 and Figures 1–3 are embedded raster images that did not extract as text — Table 1 was rendered at 150 dpi and every value transcribed cell-by-cell (Gas Dx 7.57/2.97/5.93; Gas Tx 6.80/2.67/5.33; Bulk 8.91/4.65/6.94; Service 11.30/6.55/9.11; Off-grid 12.56/9.22/9.22), so data_quality: verified. Figures 1–3 (transport $/vkt, process-heat economics, energy-loss diagram) are qualitative charts and are not cited as numeric claims.
⚠ Currency = NZD (confident). Every “" in the report is NZD: a NZ consultancy, six NZ Govt/utility sponsors, and the explicit benchmarks "wholesale natural gas … 6/GJ” and “wholesale electricity … $0.075/kWh” are NZ figures. This is the clean-currency counterpart to the currency-ambiguous marine costs in LIT_068.
⚠ The “14 NZD/kg” attribution gap (load-bearing for RT_166). LIT_033 (its ref [77]) cites “Concept Consulting 2019” for green-hydrogen production LCOEs of 8.91 (large-scale) and 14 (small-scale) NZD/kg. The 8.91 is verified here — though note LIT_033 labels it “large-scale” whereas this report presents 8.91 as the current bulk-storage reference (an 85%-capacity-factor large-scale facility), so the label is loosely consistent. The 14 figure is not in this Summary; the nearest current values are off-grid bulk storage 12.56 and service station **11.30 /kg**. Most probably the 14 is drawn from **Report 2 (Analysis)** — a decentralised/small-scale or higher-storage case not shown in the Summary — or is a rounding by LIT_033. Flagged, not reconciled; carried on the still-open RT_166 (Report 2 – Analysis leg). Do NOT enter "14 NZD/kg" into any NI cell citing *this* page. **RESOLVED 2026-07-19 → [[ot_151_concept-2019-hydrogen-nz-r23|OT_151]]:** Report 2 (Analysis) read in full — no 14/kg green-H₂ production cost exists in Reports 2 or 3; the “14” is an unsubstantiated attribution (nearest values: off-grid 12.56/kg, service-station 11.30/kg, or a plotted ENEA comparator ~$15/kg).
⚠ Vintage. 2019 study — electrolyser capex and NZ electricity/carbon prices have moved since; treat the cost figures as a 2019 NZ reference point, not current, and pair with the 2024-era framing in CR_040 / CR_042 / OT_081 (recalibration carried by LIT_033’s existing research-gap residual — no new RT).
⚠ Author field. The corporate author is Concept Consulting Group Ltd; the PDF-metadata author “simon” is the file creator, not a citable author. Report 1 lists no individual bylines.
Corpus fit. Joins the D01 hydrogen evidence cluster — LIT_033 (off-grid Rakiura MECM, 6.97 NZD/kg), LIT_061 (seasonal H₂ storage), CR_040 / CR_042 (NZ community-H₂ viability & policy framing), OT_081 (MBIE Hydrogen Action Plan 2024), URL_016 (EU REMOTE off-grid H₂) — as the foundational NZ cost-and-role primary these mostly derive from or corroborate.
Connections
Links to
Referenced by
EDT domains (1): D01: Renewable Energy & Storage Systems
SSI indicators (1): I01: Financial & Economic Self-Sufficiency
Technologies (1): Hydrogen Storage (community-scale, seasonal)