Smart Choices for Industrial Decarbonization: Impact of Electricity Grid Connection on Risk and Sizing of Photovoltaic-Electrolyzer Systems

Industrial decarbonization and the transition to
sustainable energy sources present a critical challenge. This study
addresses the fundamental trade-off between energy
independence and system efficiency in photovoltaic (PV)-
electrolyzer systems. We investigated the impact of electricity
grid connection on the risk and sizing of PV-electrolyzer systems
for industrial energy supply. A multi-method approach was
applied, combining fault tree analysis of grid-connected and
stand-alone configurations with a system sizing model based on
an industrial demand profile. Results revealed that grid fault
contributed minimally to total system risk, whereas off-grid
configurations demanded oversizing of PV and electrolyzer
capacities — up to 17× and 6× the average demand, respectively.
The findings suggest that while off-grid systems are technically
feasible, their complexity and cost (levelized cost of hydrogen
~ 15 $/kg H2) raise questions about practicality under standard
conditions. This study provides guidance for strategic decisions
around grid dependency, system robustness, and sustainable
design in industrial decarbonization