Techno-Economic Feasibility of Green Hydrogen Production Utilizing Geothermal Energy in Indonesia ^†

This study provides a comprehensive techno-economic assessment of green hydrogen production utilizing geothermal energy, conducted by PT Pertamina Geothermal Energy Tbk, Indonesia. Leveraging Indonesia’s abundant geothermal resources, ranked second globally, the research evaluates the feasibility of producing green hydrogen and its derivatives—green ammonia and methanol—through geothermal-powered electrolysis. Technical analysis considered alkaline, proton exchange membrane (PEM), and solid oxide electrolysis (SOE), concluding that PEM technology offers optimal efficiency and technological readiness. A pilot plant producing 100 kg/day of hydrogen via PEM electrolysis requires approximately 236 kW, consuming 900 kg/day of water and producing 800 kg/day of oxygen by-product. Scaling to a 10 MW geothermal facility could yield approximately 4 tons/day of hydrogen, alongside 33 tons/day of oxygen. Market analysis indicates significant domestic demand for green hydrogen in sectors such as fertilizers and biodiesel yet highlights economic challenges due to higher production costs compared to conventional hydrogen. The financial evaluation places green hydrogen production costs at around USD 8.69/kg, significantly above conventional hydrogen (USD 1–4/kg). Green ammonia and methanol also currently exhibit cost premiums over their conventional counterparts. Regulatory analysis identifies gaps in national policies supporting green hydrogen. Recommendations include developing robust regulatory frameworks, implementing fiscal incentives like carbon taxes and subsidies, and streamlining permitting processes to accelerate industry growth. Additionally, international collaboration and knowledge exchange are encouraged to enhance local capacities and align with global sustainability standards. In conclusion, geothermal-based green hydrogen production in Indonesia is technically viable and environmentally beneficial. Strategic policy interventions, technological advancements, and market incentives are critical for addressing economic challenges and enabling a sustainable energy transition.