Hydrogen Heating at Cartier’s Manufacture
Partner organization: Cartier
Context: In a world where climate change becomes critical and as Manufacture Cartier Horlogerie uses hydrogen in production process, the Manufacture de Cartier wishes to study the various possibilities for phasing out natural gas heating in favor of less carbon-intensive energy. This project aims at evaluating hydrogen heating from three aspects: technical, financial, and environmental.
Methodology: The most relevant scenario to evaluate, in terms of costs and available space, is a hydrogen system designed to cover peaks of heating demands. The remaining electricity generated from solar PVs will be auto-consumed or reinjected into the grid. The peaks have been estimated by a Heating, Ventilation, and Sanitation (HVS) Engineering Office, which proposed, in addition of a heat recovery facilities in place, that the remaining heating needs could be covered by heat pumps.
- 1. Technical Feasibility: To cover the peaks, the heating system should provide about 85 MWh, the equivalent of 2.5 tons of hydrogen. Some of it will directly be used for heating, and the rest will have to be stored. This system requires a storage tank capacity of 1 ton of hydrogen, that will be filled and emptied over time. In this scenario, the rate of use of the electrolyzer is only about 20%. The rest of the energy produced by solar panels can be consumed by the factory or reinjected in the grid.
- 2. Financial Analysis: The hydrogen system alone would cost around 1’500’000 CHF, which is a significant investment. After this investment, the annual savings of this system are 16’200 CHF per year, and the Net Present Value over its lifespan (25 years) is 316’280 CHF. This corresponds to a ROI of -79%, and will not be profitable. The annualized return of this investment is -6%. However, PVs are an integral part of the system; when they are considered for the analysis, the resulting ROI is 103%, given the annual savings of gas and electricity, and the system will break even after 11 years.
- 3. Environmental analysis: Not only would this system allow the manufacture to move away from natural gas consumption, but it will also allow it to be more self-sufficient. After 17 years, the hydrogen system, which emits 2’095 tons of CO₂, will provide a better environmental payback than current systems, which would emit by then 3’113 tons of CO₂.
Key Takeaway: Hydrogen for carbon neutrality!
The most financially profitable option to reduce the emissions of the manufacture is to (i) install solar panels for self-consumption, (ii) install heat pumps and heat recovery facilities for heating, (iii) and to keep the gas boiler for peak heating demands. However, to fully decarbonize the manufacture’s heating system, which would make Cartier stand out among its competitors, then a hydrogen system becomes highly relevant.
Transformative Project’s Lead: Samuel Wicki