Application of Levelized and Environmental Cost Accounting Techniques to Demonstrate the Feasibility of Green Hydrogen-Powered Buses in Brazil

Background: This study applied levelized cost of hydrogen (LCOH) and environmental cost accounting techniques to evaluate the feasibility of producing green hydrogen (GH2) via alkaline electrolysis for use in a bus fleet in Fortaleza, Brazil. Methods: A GH2 plant with a 3 MW wind tower was considered in this financial project. A sensitivity analysis was conducted to assess the economic viability of the project, considering the influence of production volume, the number of electrolysis kits, financing time, and other kay economic indices. Revenue was derived from the sale of by-products, including green hospital oxygen (GHO2) and excess wind energy. A life cycle assessment (LCA) was performed to quantify material and emission flows throughout the H2 production chain. A zero-net hydrogen price scenario was tested to evaluate the feasibility of its use in urban transportation. Results: The production of GH2 in Brazil using alkaline electrolysis powered by wind energy proved to be economically viable for fueling a hydrogen-powered bus fleet. For production volumes ranging from 8.89 to 88.9 kg H2/h, the sensitivity analysis revealed high economic performance, achieving a net present value (NPV) between USD 19.4 million and USD 21.8 million, a payback period of 1–4 years, an internal rate of return (IRR) of 24–90%, and a return on investment (ROI) of 300–1400%. The LCOH decreased with increased production, ranging from 56 to 25 USD/MWh. Over the project timeline, GH2 production and use in the bus fleet reduced CO2 emissions by 53,000–287,000 t CO2 eq. The fuel cell bus fleet project demonstrated viability through fuel cost savings and revenue from carbon credit sales, highlighting the economic, social, and environmental sustainability of GH2 use in urban transportation in Brazil.