The worldwide shift toward decarbonization has made green hydrogen an essential energy carrier to transition to a sustainable world. Green hydrogen, as a multi-purpose, zero-emission fuel that is generated with renewable electricity, has a massive potential in solving climate problems in areas where direct electrification is difficult. Nevertheless, mass implementation of hydrogen technology is experiencing one main challenge: hydrogen storage. In contrast to conventional fuels, hydrogen is unique with regard to storage due to its low volumetric energy density (8 MJ/L for liquid hydrogen, 5.6 MJ/L for compressed hydrogen gas at 700 bar pressure, compared to 32 MJ/L for gasoline under ambient conditions), high diffusivity and compatibility issues with materials. This article examines the techno-economics of hydrogen storage technologies, considering their prices, efficiencies, scalability possibilities and their best uses in a developing green hydrogen economy.
Storage technologies
Hydrogen storage technologies are a wide and developing field, where every technology has its own technical characteristics and economic consequences. There are various types of hydrogen storage, and all the methods have their own merits and demerits.
Gaseous storage
Compressed hydrogen is stored in a high-pressure tank at 350-700 bar. The tanks are usually made of carbon fiber composites, aluminum alloys or steel, which are durable and strong. Compressed hydrogen has storage densities of ~23-42 kg H2/m3. The storage cost of compressed hydrogen varies between $16-20 per kg of hydrogen, and the capital cost of a compressed hydrogen tank is about $500-1000 per kg H2 storage capacity at 700-bar systems. The storage duration is long-term, but hydrogen can be lost to permeation at a rate of 0.1-1 percent per day. The compression process alone uses 10-15 percent of the energy stored in hydrogen, and therefore, energy efficiency is an issue. This method is most frequently used in the hydrogen fuel cell vehicles (FCVs), industrial gas supply and refueling stations. The major factors are the high cost of storage, the possible leakage of gases and the need for constant refueling since the energy density of gaseous hydrogen storage is lower than that of liquid or solid-state hydrogen storage.
Liquid hydrogen storage
Liquid hydrogen storage involves cooling hydrogen to -253 °C and storing it in stainless steel cryogenic tanks with vacuum insulation to reduce the rate of heat transfer. The storage density of this method is much greater (70.8 kg H2/m3) than that of compressed gas storage. The process of liquefaction is, however, energy-intensive and consumes 30-35 percent of the energy content of the hydrogen stored. Liquid hydrogen storage costs $12-15 per kg of hydrogen, and the capital costs of the cryogenic storage tanks are relatively expensive at $1,000-3,000 per kg H2 capacity. Its storage life is medium-term, and boil-off loss is about 0.1-1 percent per day; thus, it is not suitable for long-term storage. This is applied mainly in aerospace (rocket fuel), hydrogen refueling stations and in some transport systems. The major concerns involved are the high energy needed in liquefaction, stringent insulation and boil-off losses.
Metal hydride storage
Metal hydride storage makes use of metal alloys where the hydrogen is chemically bound under moderate pressures of 1-10 bar and temperatures of 200-400 °C. Typical hydride-forming materials are magnesium hydride (MgH2), titanium-based alloys and lanthanum-nickel (LaNi5). This technique has an extremely high storage density of 40-120 kg H2/m3, which is far more than that of compressed or liquid hydrogen storage. The cost is, however, very high, the storage cost being $50-150 per kg of hydrogen, and the capital cost between $1500-4000 per kg H2 capacity, depending on the metal alloy used. The storage time is high since hydrogen is stored chemically and will not leak as it does with gaseous or liquid hydrogen. There is the issue of energy usage, where heat is necessary to release hydrogen and it uses up 5-10 percent of the stored hydrogen energy. It is a common form of storage in stationary energy storage systems, submarines and portable hydrogen fuel cells. The factors to be considered are high weight of the system, slow rate of hydrogen release and high cost of special metal alloys.
LOHCs
Liquid organic hydrogen carriers (LOHCs) represent a safe, stable and economical method of storing hydrogen at ambient temperature and pressure through encapsulation in an organic liquid like dibenzyl toluene. The storage density of this method is about 57 kg H2/m3 which makes it competitive with compressed gas storage. The storage rate is comparatively cheap at $5-8 per kg of hydrogen, whereas capital costs vary between $500-1,500 per kg H2 capacity. The storage time is unlimited, as hydrogen remains chemically attached to the liquid carrier until usage. But this involves catalytic hydrogenation and dehydrogenation at temperatures of 150-300 °C, and this makes the process more complex in operation and requires extra energy. LOHCs are primarily applied in long-range hydrogen delivery and in stationary hydrogen storage. The factors to be considered are specialized reactors, increased complexity in the production of hydrogen and comparatively lower rates of hydrogen release compared to gaseous or liquid storage.
Cavern storage
Salt caverns, depleted natural gas fields or aquifers can be used to provide large-scale hydrogen storage, enabling cost-effective and high-capacity storage. Each location has the potential to store 100,000 tons of hydrogen, which makes it one of the most viable ways of storing large quantities of hydrogen. The low-cost storage has been as little as $0.1-1/kg hydrogen, and the capital cost as little as $1-10/kg H2 capacity, depending on the geological formation exploited. There is no time limit on storage, and there is very little loss of hydrogen. The energy cost of injecting hydrogen and retrieving it is also very low (~1-2 percent of the energy stored). This technique is mainly utilized in grid-scale energy storage, industrial hydrogen supply and renewable energy integration. But it is constrained by geological feasibility, which demands particular underground structures and is also expensive to initially invest in the infrastructure.
Cutting-edge advancements
New hydrogen storage methodologies are also fast maturing, enabling the world to use hydrogen safely, more efficiently and at a large scale. The 700-bar carbon fiber reinforced polymer (CFRP) tanks developed by Toyota are an established high-pressure gas system with 5.7 wt percent gravimetric and 40 kg/m3 volumetric storage capacity, advanced multi-layer safety, and real-time monitoring at a price of ~$150,00 per tank system. The cryo-compressed hydrogen (CcH2) technology developed by NASA and BMW presents a cryogenic cooling of -253 °C combined with 350-bar compression to a density of 65 kg/m³ and energy densities 50 percent more than gaseous systems, with vacuum-insulated vessels and active pressure control with ~$20/kg H2 capacity. The NU-1501 MOF developed by Berkeley Lab offers 14.4 wt percent and 67 kg/m3 storage capacity at 77K and 100 bar with good thermal stability and an estimated cost of $50/kg at scale due to its ultrahigh porosity. GKN Hydrogen’s HY2MEDI metal hydride system has 6.5 wt percent, 105 kg/m3, and nano-enhanced magnesium hydrides with passive cooling, 85 percent energy efficiency and a cost of $3000/kg H2. The storage of hydrogen in the form of LOHC technology developed by Hydrogenious’ has a storage capacity of 57 kg/m3 in a safe, ambient, non-explosive liquid form with a long shelf life, and the cost of storage is $3.48–5.8/kg. HyStock has a salt cavern-based storage facility in the Netherlands with underground capacity of 5,400 tons H2 per cavern at a price of $0.41/kg with both micro seismic monitoring and brine curtain systems, which is ideal for storing seasonal and grid-scale storage.
Toward a sustainable future
According to Nepal’s latest Energy Roadmap, the country is estimated to generate 28,500 MW of electricity by 2035. With domestic demand forecasted at just 7,589 MW, Nepal could have a surplus generation capacity of approximately 20,919 MW after domestic consumption and export commitments. If this surplus remains unutilized, it could result in an annual loss of trillions of Nepali rupees. But through the production of green hydrogen by converting the excess power into this fuel, and storing it, Nepal will be able to turn this possible loss into a good economic opportunity. Given that 1 MWh produces 20 kg of hydrogen, the country will be able to produce more than 2.2bn kg of hydrogen every year. There are different storage technologies, including high-pressure tanks, cryo-compressed systems, metal hydrides and LOHCs, that have various benefits regarding capacity, safety and cost. In Nepal’s context, whose infrastructure is still developing, the average price of storing hydrogen using these approaches is Rs 250/kg. This makes the complete cost of storage per year Rs 549bn. This, combined with the cost of electrolysis, results in a total investment of
Rs 1.28trn/year. Upon re-electrification during dry seasons, where imported electricity costs
Rs 16/unit, this hydrogen could generate electricity worth Rs 1.17trn, resulting in a net annual loss of Rs 114.78bn under current economic conditions.
However, this apparent loss must be seen through the lens of a circular economy. Although the financial outcome of the process seems to be negative at the moment, the internal economic value of the process is preserved by the fact that the country does not have to import expensive electricity in the dry season. Instead of losing money out of the national economy, it flows within the country in the form of local production and use of hydrogen. Moreover, the high initial infrastructure investment and technological immaturity are justified when considering the strategic role of hydrogen as a fallback mechanism. In case of any unavoidable circumstances, Nepal cannot export its surplus electricity, may be because of limitations of regional grid, due to geopolitical reasons or may be due to fluctuations in the demand, under such circumstances, hydrogen production and storage can be the only possible solution, which can prevent the total wastage of energy produced. This will make sure that even otherwise stranded zero-cost electricity will be monetized in terms of real economic goods.
Recognizing this potential, the government has already taken key policy steps, exempting income tax and customs duties on hydrogen-related equipment. However, additional incentives, subsidies and regulatory frameworks are necessary to make hydrogen one of the enablers of national energy security and economic resilience. With global hydrogen prices projected to fall below $1/kg by 2050, Nepal’s strategic transition, from high-pressure cylinders to advanced LOHCs and metal hydrides, will enable cost-effective and large-scale storage. This roadmap positions Nepal to transform surplus hydropower into a multi-billion-rupee green hydrogen economy, ensuring grid stability, energy independence and regional leadership in clean energy development.
