Levelized Cost of Hydrogen Calculator

Blend total installed CAPEX, operating expenditures, financing assumptions, and annual hydrogen production to express a project’s levelized cost per kilogram.

Include EPC, grid connection, and commissioning costs for the full hydrogen facility.
Service life used for capital recovery factor calculations.
Sum fixed O&M, variable electricity costs, and water/feedstock spend for the year.
Metered hydrogen production sold or consumed over the same year.
Defaults to 8%. Use nominal WACC aligned with financing structure.
Defaults to 0. Include oxygen sales or incentives that reduce net annual cost.

Validate cost assumptions with project finance models before using the results for investment decisions.

Examples

  • CAPEX $450M, 20-year life, 8% WACC, $60M annual OPEX, 40M kg output, $5M credits ⇒ $2.52/kg with $45.83M annualized CAPEX
  • CAPEX $275M, 25-year life, 6% WACC, $38M annual OPEX, 35M kg output ⇒ $1.70/kg

FAQ

Why is the capital recovery factor required?

The factor annualises the one-time CAPEX so it can be combined with annual operating costs. It reflects the time value of money over the project lifetime.

How should I treat variable electricity pricing?

Aggregate electricity spend for the year in the operating expenditure input. If you hedge prices, use the settled cost including congestion and ancillary fees.

Can the levelized cost be negative?

It is possible if incentives or credits exceed annual costs, though in practice a negative LCOH would signal an input mismatch or temporary subsidy effect that should be documented.

What hydrogen output should I use?

Use net saleable hydrogen delivered to customers or storage after accounting for plant consumption, venting, and purity adjustments.

Additional Information

  • Capital recovery factor converts upfront CAPEX into an equivalent annual payment based on WACC and asset life.
  • Annual operating expenditure should include electricity, water, maintenance labour, and catalyst replacements within the selected year.
  • By-product credits lower the net annual cost if oxygen, waste heat, or incentives are monetised.

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