How Stargate Hydrogen’s improved electrolyser efficiency impacts LCOH
Stargate Hydrogen’s reported stack efficiency of 48 kWh per kilogram offers a practical route to lower green hydrogen costs. For a 5 MW installation, the comparison below estimates that integrating this performance could reduce LCOH from EUR 6.13 to EUR 5.91/kg in Germany from EUR 5.42 to EUR 5.22/kg in Finland, and from EUR 7.34 to EUR 7.08/kg in the Netherlands. At unchanged annual electricity input, that is a reduction of about 3.6% in all three locations.
Walerian Majewski ·
The reduction of about 3.6% in all three locations translates to approximately 18 tonnes of additional hydrogen each year.
We present illustrative plant costs under stated electricity-supply and investment assumptions, rather than national averages or a quotation for a Stargate installation. The purpose is to show how improved efficiency translates into economic value, while distinguishing the performance of the stack from that of the complete plant.
From stack efficiency to whole plant performance
The October 2026 STARDUST announcement describes ceramic electrode technology delivering reported stack consumption of 48 kWh/kg without platinum-group metals. The manufacturer reports availability in stacks up to 0.5 MW, with 5 MW stack integration under way. A 5 MW AC installation in this analysis is an economic comparison scale: it is not equivalent to a confirmed specification or quotation for that 5 MW stack.
The reference system consumes an assumed 54.58 kWh/kg, represented by 50 kWh/kg at the stack plus 4.58 kWh/kg for power conversion and auxiliaries. Replacing the stack assumption with 48 kWh/kg gives 52.58 kWh/kg for the installation. The reference decomposition is an analytical assumption, not a measured earlier Stargate product. Auxiliary demand moderates the system-level improvement, but the resulting 3.66% reduction in specific electricity consumption remains valuable.
Electricity procurement and contrasting network charges
The PPA assumptions are EUR 52.1/MWh in Germany, EUR 28.9/MWh in Finland and EUR 51.4/MWh in the Netherlands. All come from the same KYOS June 2026 assessment of onshore-wind contracts for 2027–2036 deliveries. They are modelled P25-equivalent fixed-price assessments, after a risk discount, rather than executable offers to a 5 MW buyer. Contract size, credit support, balancing and renewable matching can change the achievable price. The additional EUR 5/MWh allowance is not a quotation for fully shaped RFNBO-compliant supply.
For Finland, a 20 kV connection is represented using Caruna Espoo’s published 2026 industrial tariff. The effective network and public-charge assumption is approximately EUR 11.30/MWh at the selected operating pattern. This is one local distribution-network example, not a national tariff. It includes recurring energy, capacity and basic charges and the assumed industrial tax treatment; no additional Fingrid tariff is added on top.
Germany provides an important exemption for eligible electrolysers. Section 118(6) EnWG allows exemption from ordinary network-access fees for 20 years, subject to the applicable commissioning window and conditions. The analysis assumes commissioning by 3 August 2029 and qualification for that exemption. It can apply to distribution-connected electrolysis as well as transmission-connected installations.
The calculation retains applicable remaining charges and assumes separate eligibility for green-hydrogen levy relief and process-electricity tax relief. The resulting reference allowance is approximately EUR 1.13/MWh.
The Dutch case uses Liander’s 2026 standard firm tariff for contracted demand above 2 MW, with 5 MW contracted and reached in each month. The effective recurring network cost is approximately EUR 24.07/MWh, compared with EUR 11.30/MWh for the Finnish network-and-tax example and EUR 1.13/MWh of remaining charges in the eligible German case. The Dutch allowance is predominantly capacity-based. No second TenneT charge is added. Eligible hydrogen-production electricity is assumed to receive energy-tax relief; this is distinct from exemption from network charges.
Figure 1. LCOH at unchanged annual AC electricity input. The improved case includes the reported 48 kWh/kg stack consumption plus the assumed auxiliary allowance.
The output increase is approximately 3.80%, or 18.3 tonnes per year. More kilograms spread annualised investment and fixed operating costs over greater production. This explains why the LCOH improvement is larger than the direct electricity saving calculated for a fixed hydrogen output. All three countries benefit even though their electricity costs and tariff structures differ.
The Netherlands has the highest LCOH in this comparison despite its PPA assumption being slightly below Germany’s. Its recurring network charge contributes approximately EUR 1.31/kg at reference efficiency, compared with EUR 0.06/kg of remaining regulated charges in Germany. This accounts for most of the Dutch–German cost difference. Finland benefits from the lowest energy-price assumption, partly offset by higher regulated charges than in the exempt German case.
At unchanged annual electricity input and peaks, the Dutch annual network bill remains approximately EUR 632,460. Higher hydrogen output reduces its contribution from EUR 1.314 to EUR 1.265/kg. This EUR 0.048/kg improvement is a spreading of the same annual bill over more output, not a cash reduction in network payments. The full Dutch LCOH saving of EUR 0.267/kg also includes the lower energy requirement per kilogram and dilution of fixed plant costs.
Figure 2. Components of plant-gate LCOH. Annualised capital includes the discounted replacement-stack allowance.
A positive step towards more competitive hydrogen
Stargate’s achievement improves a fundamental driver of hydrogen economics: the electricity needed for each kilogram. At complete-installation level the benefit is moderated by auxiliaries, yet the 5 MW example still shows a meaningful cost reduction and additional production from the same electricity budget. This is useful progress for smaller industrial installations as well as larger developments.
Turning that progress into a bankable plant requires guaranteed system efficiency, operating range and stack life, together with an appropriate connection and renewable supply contract. A low-priced PPA alone does not establish RFNBO compliance. The applicable additionality, geographical and temporal requirements, including hourly matching from 2030 under the relevant provisions, still need to be addressed. The annual model illustrates the economics; it does not certify renewable hydrogen production.
LCOH is calculated as annualised initial investment and discounted stack replacement, plus annual operating costs, divided by annual hydrogen production. The model uses no tax shield, residual value, inflation escalation or separate degradation curve. Keeping these assumptions explicit allows supplier data and site-specific electricity terms to be incorporated without obscuring the contribution made by improved stack efficiency.