Achieving Water and Energy Independence, Economic Sustainability, and CO₂ Reduction Through Hybrid Renewable Systems: A Case Study of Skyros Island

Abstract

This study explores the challenge of achieving water and energy self-sufficiency in isolated regions through the design a hybrid renewable energy system (HRES) for Skyros, a Greek island not connected to the mainland grid. The proposed system integrates wind turbines, photovoltaics, pumped hydro, and hydrogen storage to ensure a stable supply, particularly during peak summer demand. Using advanced R simulations, three scenarios were analyzed on a 30 min basis. A combined storage system meets 99.99% of water demand and 83% of electricity needs. A pumped hydro-only system covers 99.99% of water demand and 74% of electricity needs. A hydrogen-only system supplies 99.99% of water demand but just 67% of electricity needs. The findings indicate annual CO₂ emission reductions exceeding 9600 tons. Economic analysis confirms the system’s feasibility, with a projected 10-year payback period. The cost of desalinated water is estimated at EUR 1/m³, while energy costs range from EUR 0.083/kWh for pumped hydro to EUR 0.093/kWh for hydrogen storage and EUR 0.101/kWh for the combined system. Overall, the results highlight the potential of hydrogen storage to enhance system flexibility and complement pumped hydro, offering sustainable water and energy solutions for isolated regions while addressing both environmental and economic challenges.

1. Introduction

In 2015, the United Nations (UN) established the 17 Sustainable Development Goals (SDGs) with a mission to promote global sustainable development by 2030. These objectives aim to address critical challenges, including the alleviation of poverty, environmental sustainability, and overall societal well-being while ensuring a balance between economic, social, and environmental factors. Among these, Goal 6 emphasizes the necessity of access to clean water and adequate sanitation for all, while Goal 7 focuses on universal access to affordable, reliable, and sustainable energy. Both goals are pivotal to fostering sustainable development, mitigating environmental concerns, and improving quality of life worldwide [1].

Hybrid renewable energy systems (HRESs) have emerged as a viable approach for optimizing water and energy management, particularly in remote regions [2]. Numerous research initiatives have examined different aspects of HRESs.

Some studies primarily focus on water management. For instance, Triantafyllou et al. [3] assessed the integration of solar-powered desalination units on Nisyros Island, providing a sustainable solution to water scarcity, while minimizing CO₂ emissions and operational costs. Another study [4] explored the incorporation of reclaimed wastewater into the water supply system of Sifnos Island, utilizing circular economy principles. Through an assessment of water balance scenarios from 2011 to 2041, the study underscored the escalating water deficit driven by tourism and population growth. The research recommended upgrading wastewater treatment plants to advanced systems as a mitigation strategy. Similarly, Travaglini et al. [5] evaluated the feasibility of a renewable energy-powered reverse osmosis desalination plant on Tilos, a small Mediterranean island, demonstrating substantial cost savings and reduced greenhouse gas emissions in alignment with sustainability objectives. Atay and Saladié [6] investigated the perspectives of hospitality stakeholders on Mykonos regarding water scarcity and climate change, revealing a strong awareness of these issues and recognition of desalination plants as a partial solution while emphasizing the need for a coordinated approach to sustainable water resource management. Abedi et al. [7] investigated the integration of solar chimneys with humidification–dehumidification desalination systems, introducing the concept of a “solar desalination chimney”. Their study demonstrated the feasibility of small- and large-scale autonomous desalination units powered exclusively by solar energy, offering a sustainable solution for freshwater generation in arid and remote regions. Lagaros et al. [8] examined an HRES in Serifos Island combining wind, solar, desalination, and both pumped hydro and hydrogen storage. Their scenarios achieved energy coverage exceeding 85% and water coverage surpassing 90%, highlighting the role of seasonal demand and existing infrastructure.

Other pieces of research have examined diverse energy production methods, system optimization, and economic assessments. Żołądek et al. [9] analyzed a hybrid energy system combining wind, solar, battery, and hydrogen storage on a Greek island, achieving a 97% reduction in fossil fuel use and demonstrating economic viability with a projected payback period of 11 to 15 years. Yang et al. [10] explored the benefits of hybrid battery and hydrogen energy storage systems, highlighting their unique potential for large-scale storage by addressing cost efficiency and capacity challenges. De Moura Altea et al. [11] compared pumped hydro storage with hydrogen storage, concluding that pumped hydro is roughly three times more energy-efficient while it covers 84% of exergy costs and emits 23% less CO₂ than hydrogen storage. Roy et al. [12] analyzed the energy needs of a rural Indian village, identifying an optimal HRES configuration featuring photovoltaic panels, wind turbines, biogas generators, batteries, electrolyzers, and hydrogen tanks, thus achieving reduced fuel consumption at a cost of USD 0.44/kWh. Additionally, Wang et al. [13] introduced the ISABO (Improved Subtraction-Average-Based Optimizer) algorithm for HRES optimization, demonstrating a 12% reduction in Net Present Cost and a 45% decrease in electrolyzer expenses while maintaining reliability with only a 0.8% decrease in Load Point Supply Probability during failures, therefore outperforming traditional optimization methods.

Further research has examined energy storage approaches. Papathanasiou et al. [14] investigated a wind-powered HRES utilizing both pumped hydro and hydrogen storage, concluding that combining both methods maximizes energy coverage and efficiency, making it a promising solution for remote areas. Skroufouta and Baltas [15] analyzed an HRES model for Karpathos, incorporating stochastic modeling to account for uncertainties in weather patterns of rainfall and fluctuating temperatures, ensuring stable water and energy supplies while maintaining economic feasibility with an internal rate of return between 10% and 17%. Bertsiou and Baltas [16] compared two energy storage approaches: a conventional pumped hydro system and a hybrid pumped hydrogen system, incorporating hydrogen production and storage as an additional storage method. While the former involved lower costs, the latter provided greater reliability and more consistent energy supply, particularly for electricity generation and desalination. Wind speed was identified as a key determinant in cost efficiency and load loss probability. Coelho et al. [17] developed the HY4RES model (hybrid model for renewable energy systems), an optimization framework integrating solar, wind, pumped hydro storage, and batteries. Using the GRG (generalized reduced gradient) and NSGA-II (Non-dominated Sorting Genetic Algorithm) methods, the model optimized three objectives: maximizing lifetime cash flow, minimizing grid energy consumption, and increasing hydropower output. A case study demonstrated that wind energy integration reduced grid dependency by up to 60% for high water demands, ensuring economic viability and proving the effectiveness of the HY4RES’s in autonomous energy solutions for remote areas.

This study builds on existing research by offering a detailed analysis of CO₂ emissions across different energy storage configurations, highlighting the environmental benefits of HRESs. Additionally, it presents a novel perspective on hydrogen storage in isolated island systems, using Skyros as a case study. Unlike other Greek islands previously studied, Skyros remains completely off-grid, lacking interconnection to the electricity network of the mainland. This makes it an ideal case for a self-sustaining, hydrogen-based energy system where surplus renewable energy can be converted into hydrogen for storage and future use.

Although hydrogen is widely discussed as a future energy carrier, its feasibility in real-world, small-scale island settings remains underexplored. This study demonstrates that integrating hydrogen storage within an HRES can enhance energy autonomy and facilitate green hydrogen production in isolated areas. By employing a high temporal resolution (30 min intervals) in energy modeling, this study provides a precise assessment of renewable energy fluctuations and storage performance, ensuring a comprehensive evaluation of system efficiency and viability. Addressing the operational feasibility of hydrogen production and storage within an isolated energy framework, this study offers valuable insights into the global transition toward sustainable, hydrogen-powered island communities.

This study introduces an innovative approach to water and energy management in remote regions, integrating both pumped hydro and hydrogen storage within an HRES framework. Unlike prior studies that focused on a single storage medium, this study combines both methods, achieving higher system efficiency and reliability, as corroborated by [16], particularly when utilizing wind turbines and photovoltaic energy generation.

The analysis of an HRES on Skyros, an island that faces seasonal water and energy challenges during peak summer demand, suggests potential applications for other isolated regions. Furthermore, this study evaluates environmental impact by quantifying total CO₂ emissions, an aspect often overlooked in previous HRES studies.

By integrating pumped hydro and hydrogen storage technologies in a comparative framework, this research advances the understanding of HRES implementation in isolated locations. Utilizing over a decade of real-world data, they provide practical insights into energy-efficient planning, addressing critical issues such as seasonal demand fluctuations and renewable energy variability, thereby contributing to sustainable solutions for energy and water security in remote areas.

To explicitly define the scope of the study, the following key research questions are addressed.

• To what extent can an HRES ensure both water and energy independence for a remote, non-interconnected island such as Skyros?
• How do different energy storage configurations—pumped hydro, hydrogen, or a combination—compare in terms of technical performance, economic feasibility, and environmental impact?
• Can the integration of hydrogen storage enhance the flexibility and resilience of HRESs in small-scale, off-grid island settings, and what are the implications for CO₂ emissions and seasonal reliability?

This paper is organized into five sections. Section 1 introduces the research problem, outlines the objectives of the study, and highlights the significance of achieving water and energy independence in remote island contexts. Section 2 presents the study area, and the methodological framework used for the design and simulation of the HRES. Section 3 discusses the scenario analysis and presents the results of the system’s performance under different storage configurations. Section 4 provides a discussion of the main findings in the context of the existing literature. Finally, Section 5 summarizes the key conclusions and suggests future research directions.

2. Materials and Methods

2.1. Study Area

As recorded in the 2021 Census [18], Skyros is an island of a total area of 209.5 km² and a permanent population of 2913 residents. The island remains disconnected from the mainland electricity grid of Greece [19]. Its primary water supply originates from the Anavalsa spring [20], although this water is non-potable. Due to seasonal tourism, the population surges to approximately 12,000 people during the summer months. The island is accessible throughout the year by both boat and airplane.

Climatic conditions on Skyros Island are characterized by strong wind patterns and high solar irradiance, making it suitable for renewable energy exploitation. According to data from the Hellenic National Meteorological Service, the average annual wind speed is 10 m/s, the average annual temperature is 17 °C, and the average annual relative humidity is 72%. The mean annual precipitation amounts to 428 mm, and the mean daily solar radiation reaches approximately 5.2 kWh/m²/day [21]. In Figure 1, a map of Skyros is presented, along with its relative position to Greece.

As a member of the European Union (EU), Greece is committed to achieving carbon neutrality by 2050, aligning with EU-wide initiatives to reduce greenhouse gas emissions and mitigate climate change [23]. Many Greek islands, particularly those not linked to the mainland grid, rely on diesel power plants for electricity. This reliance not only hampers Greece’s carbon neutrality efforts but also imposes significant economic costs due to carbon emissions taxation, estimated at approximately 0.64 kg CO₂-eq per kWh consumed. The carbon emissions tax ranges between 90 and EUR 120 per ton [24], serving both as an economic burden on fossil fuel-based power plants and an incentive to reduce emissions.

2.2. Methods

The proposed HRES for Skyros harnesses clean energy from wind turbines and photovoltaics. The total annual electricity demand for the island is 14,936 MWh, encompassing residential, commercial, and industrial consumption. These values were determined using historical data provided by the Public Power Corporation (PPC). A significant portion of this energy is allocated to desalination, a crucial process for ensuring a consistent freshwater supply [25]. The island’s total annual water demand stands at approximately 504,260 m³, requiring 1513 MWh for desalination. Water consumption calculations were based on an estimated usage of 200 L per day per resident and 300 L per day per visitor, including tourists and holidaymakers [16].

This study proposes a reverse osmosis desalination method [26], which requires approximately 3.0 kWh/m³ of energy [27]. Presently, Skyros utilizes a mix of methods for water supply, including traditional ones, but this research focuses on reverse osmosis as a sustainable future alternative [28]. Seawater salinity around Skyros, as in much of the Aegean Sea, is about 35 kg/m³ [29]. Reverse osmosis typically converts 50% of seawater input into freshwater, with the remaining 50% forming brine [30]. Brine disposal presents environmental concerns, including increased local salinity levels and potential harm to marine ecosystems [31].

Electricity and water demand calculations were derived from historical data spanning a decade (2012–2021) to incorporate both seasonal variations and long-term trends. This timeframe was selected to ensure representative conditions, minimizing distortions from extreme weather or anomalies in consumption patterns. Demand was initially modeled at a 30 min resolution to account for climatic and seasonal fluctuations, with results later aggregated into monthly averages for clarity.

During an average year, peak electricity demand reaches 2.9 MWh, while peak water demand amounts to 666 m³. On the highest consumption days, these values increase to 55 MWh and 3300 m³, respectively. Figure 2 illustrates the total monthly water demand, highlighting the seasonal surge due to tourism. The values were estimated based on average water consumption per resident and visitor, combined with monthly tourist arrivals to reflect seasonal population fluctuations and their impact on water demand.

The proposed system integrates four (4) wind turbines of the ENERCON E-92 model, each with a rated capacity of 2.35 MW, with a combined capacity of 9.4 MW and photovoltaic installations totaling 0.25 MW. The energy production units were sized to generate 1.5 times the total electricity demand to accommodate seasonal and daily fluctuations, particularly during peak summer months. This margin accounts for inefficiencies in energy storage and conversion, unexpected demand peaks, and ensures system reliability and energy autonomy.

Energy storage solutions include pumped hydro storage and hydrogen storage. The system also incorporates a potable water storage tank with a 50,000 m³ capacity to guarantee a stable freshwater supply. Additionally, a 200,000 m³ water reservoir is included. The pumped hydro storage system leverages a 300 m elevation difference between the upper reservoir and the sea, optimized for energy generation while considering geographical constraints. Hydrogen storage capacity is set at 3000 kg, equating to a volume of 36,405 m³ [32].

The reservoir is designed to provide 3 days of autonomy in water and energy, while the hydrogen tank supplies 1 day’s worth of backup power. This configuration reflects the complementary roles of both storage methods: pumped hydroelectric storage offers extended autonomy, covering most demand, while hydrogen serves as a short-term buffer for peak electricity consumption or prolonged periods of low renewable energy generation. This setup optimizes costs while ensuring system reliability.

In the pumped storage system, the lower reservoir is the sea, enabling flexibility and stability under fluctuating production and consumption conditions. The 3-day autonomy of the water reservoir ensures continuous supply during periods of low renewable energy availability, such as cloudy or windless days. Hydrogen storage acts as an additional safeguard, addressing sudden spikes in electricity demand or extended low-generation periods. This integrated approach guarantees a steady supply of both energy and desalinated water, even under challenging conditions.

The system simulation incorporates critical variables such as wind speed, solar radiation, and population trends to accurately predict HRES performance and its capability to meet local energy and water needs. Wind speed data inform wind turbine energy output estimates, while solar radiation data are essential for photovoltaic efficiency calculations. Population fluctuations, particularly during the tourist season, provide insights into varying energy and water consumption patterns.

The simulation was conducted with a high temporal resolution of 30 min, significantly improving the accuracy of energy balance calculations. This resolution captures short-term variations in energy production and demand, particularly fluctuations in wind energy, which might be overlooked in traditional hourly based models.

A key component of this study is the detailed simulation of hydrogen production and storage dynamics. Unlike traditional pumped hydro storage, which is constrained by geography, hydrogen offers a scalable and adaptable solution for long-term energy autonomy. The model accounts for electrolysis efficiency, hydrogen production energy requirements, and its subsequent reconversion to electricity via fuel cells. The hydrogen tank was sized strategically to mitigate seasonal energy shortages, ensuring that surplus renewable energy is effectively stored for periods of reduced generation. This comprehensive approach enhances system resilience and optimizes energy utilization, paving the way for sustainable and self-sufficient energy solutions on isolated islands.

This research highlights hydrogen as a key technology for off-grid island energy independence, demonstrating its integration into hybrid renewable energy solutions. By modeling hydrogen production and storage with high temporal resolution, this study provides valuable insights into the operational performance and feasibility of hydrogen-based energy autonomy in isolated regions.

Advanced coding techniques developed in the R programming language are used in order to simulate the operation of the system, enabling precise modeling and analysis of complex energy interactions. A custom-developed iterative algorithm balances energy production, storage, and consumption, ensuring the effective integration of multiple energy sources and storage methods. The algorithm accounts for key constraints, including 30 min electricity demand, renewable energy availability, and storage capacities. Historical data from 2012 to 2021 validate the model, ensuring accuracy and reliability in assessing long-term trends and system efficiency.

Wind energy generation is calculated using the turbine’s power curve [33], which relates wind speed to electricity output of the turbine. Wind speed data are adjusted for the turbine’s hub height to reflect real-world conditions accurately. With an average annual wind speed of 10 m/s, wind turbines generate 20,808 MWh annually. Equation (1), derived from the turbine’s power curve, accounts for wind speed variability and turbine efficiency.

$$E_{wind}={\displaystyle \frac{0.012688{ws}^6-{0.500166ws}^5+{6.881701ws}^4-{39.424139ws}^3{+107.328093ws}^2-101.323627ws+6.577794}{1000}}$$

(1)

In Equation (1), ws represents the wind speed in meters per second (m/s) and E_wind denotes the energy output in MWh.

Solar energy production is calculated using Equation (2) [34], incorporating factors such as solar irradiance, panel efficiency, and performance ratio. The total annual energy produced by photovoltaic panels is 2143 MWh.

$$E_{solar}=N·A·\eta ·SI·P·T$$

(2)

In Equation (2), N = 500 is the number of photovoltaic panels, A = 2 m² represents the total surface area of the photovoltaic panel, η = 15% is the efficiency or yield of the solar panel, SI (W/m²) stands for the Solar Irradiance of Skyros, P = 75% denotes the performance ratio accounting for losses, and T (s) refers to the number of hours in direct sunlight throughout a day and E_solar is expressed in Wh. The data for solar irradiance are sourced from the Photovoltaic Geographical Information System (PVGIS) of the European Commission [21], with SI values referring to tilted surfaces, thus accounting for the angle of incidence.

Pumped storage electricity generation is modeled using Equation (3) [35], where surplus energy pumps water to an elevated reservoir. When demand is high, stored water flows through a hydro turbine to generate electricity.

$$E_{hydro}=n_h·\rho ·g·Q·H$$

(3)

In Equation (3), n_h = 0.85 is the efficiency of the hydro turbine, ρ = 1000 kg/m³ is the density of water, g = 9.81 m/s² is the acceleration due to gravity, Q (m³/s) is the flow rate of water, H = 300 m is the height difference (head) between the upper and lower reservoirs and Ε_hydro is expressed in Wh [36]. The system’s total round-trip efficiency is approximately 68%, considering an 80% efficiency for pumping and 85% for hydroelectric generation. Both efficiencies are included in the energy balance calculations, ensuring that the energy losses are accurately reflected in the results.

This method converts the potential energy of water stored at a higher elevation into electricity. The efficiency factor provides an approximate estimation of energy losses during the process, such as pipe friction and turbine inefficiencies, based on standard assumptions.

Under pumping conditions, the energy required to lift water to the upper reservoir is determined by the height difference (head) and the efficiency of the pump system. The head is assumed to be constant in this study, calculated as the average height difference of 300 m between the upper and lower reservoirs. Variations in water level during operation are not explicitly modeled but are assumed to have a negligible impact on the overall efficiency due to the large reservoir capacity.

The pumped hydroelectric storage system utilizes an open reservoir for water storage. The reservoir’s design accounts for seasonal variations in demand and environmental conditions. While no specific evaporation prevention measures were implemented in the current configuration, the model assumes that evaporation losses are negligible.

Hydrogen production and storage offer a flexible backup energy source. Surplus renewable electricity powers electrolysis, converting water into hydrogen. Equation (4) estimates hydrogen production [37].

$$H_2={\displaystyle \frac{E_{elect}}{n_{elect}·E_{req}}}$$

(4)

In Equation (4), E_elect (kWh) is the surplus electrical energy used for electrolysis, n_elect = 0.75 is the efficiency of the electrolysis process [38], E_req = 45 kWh is the energy required to produce 1 kg of hydrogen through electrolysis, and H₂ (kg) is the mass of hydrogen produced [39]. Producing 1 kg of hydrogen requires 9 kg of water [40], sourced from the potable water storage tank. The hydrogen storage system deliberately operates without compression to minimize energy consumption.

The efficiency of each energy storage system is calculated (Equation (5)) as the ratio of the energy recovered during discharge (Ε_out) to the energy required to store that energy (E_in) expressed as follows [41]:

$$n_e={\displaystyle \frac{E_{out}}{E_{in}}}.$$

(5)

For the pumped storage system, E_in corresponds to the energy used to pump water to the upper reservoir, while Ε_out represents the energy generated as water flows back through the hydro turbine. An efficiency of 81% reflects losses during the pumping and generation processes. In the hydrogen storage system, E_in accounts for the energy used during electrolysis to produce hydrogen, and Ε_out corresponds to the energy produced when the hydrogen is converted back to electricity through a fuel cell. The overall efficiency of 45% incorporates losses from electrolysis, hydrogen compression/storage, and reconversion processes.

To summarize technical specifications across different scenarios,

Table 1. Technical parameters of each energy subsystem across the three scenarios.

Subsystem	Parameter	Scenario 1	Scenario 2	Scenario 3
Wind turbines	Total power	9.4 MW	9.4 MW	9.4 MW
	Number of units	4	4	4
Solar panels	Total power	0.25 MW	0.25 MW	0.25 MW
	Number of units	500	500	500
Desalination	Annual water production	504,260 m3	504,260 m3	504,260 m3
	Energy consumption	3.0 kWh/m3	3.0 kWh/m3	3.0 kWh/m3
	Tank capacity	50,000 m3	50,000 m3	50,000 m3
Pumped hydro storage	Reservoir capacity	200,000 m3	200,000 m3
	Height difference (head)	300 m	300 m
Hydrogen system	Tank capacity	3000 kg		3000 kg
	Energy consumption	45 kWh/kg		45 kWh/kg

compares key parameters of wind turbines, solar panels, desalination units, pumped hydro storage, and hydrogen storage. This table facilitates a direct comparison of each subsystem’s role in the proposed hybrid renewable energy solution.

Figure 3 details the research workflow from data collection to system simulation and key outputs. It presents the study’s findings on water supply reliability via desalination, energy reliability, economic feasibility, and environmental sustainability—important considerations for isolated regions such as Skyros Island.

In the first scenario, a combination of pumped hydroelectric storage and hydrogen storage creates a flexible and efficient system for managing surplus energy. Excess electricity is stored in both reservoirs and hydrogen reserves, ensuring a stable energy supply throughout the year by balancing seasonal fluctuations in renewable generation.

The second scenario relies solely on pumped hydroelectric storage, where surplus energy is used to pump water to a higher elevation, which is later released to generate electricity. While highly efficient and widely used, this method may be limited by geographical and storage capacity constraints.

The third scenario employs only hydrogen storage, converting excess electricity into hydrogen via electrolysis. The stored hydrogen is later used for electricity generation, offering flexibility but with lower overall efficiency compared to pumped storage.

In all scenarios, meeting water supply demand is prioritized before addressing electricity needs.

The selection of scenarios was guided by the geographical and energy context of the island. Pumped hydro storage was considered due to the island’s terrain, which allows for the development of a viable elevation-based reservoir system. Hydrogen storage was examined as an alternative for increasing energy autonomy, particularly important for non-interconnected islands like Skyros, and to address the sharp increase in demand during the tourist season. A combined scenario was also assessed to identify the most effective solution in terms of system performance and resource utilization.

The economic analysis evaluates both capital expenditures (CAPEX) and operational expenditures (OPEX) using data from comparable systems and the existing literature. Additionally, the study assesses the environmental impact by estimating CO₂ emissions reductions achieved through the transition from diesel-based generation to renewable energy sources [42]. These economic and environmental assessments are integrated into the model to provide a comprehensive understanding of the system’s benefits in each operational scenario.

3. Results

3.1. Scenario Analysis

The results indicate varying levels of water and energy demand fulfillment across different scenarios. In all cases, a potable water storage tank is used after desalination, ensuring that 99.99% of the water demand is consistently met. Electricity demand coverage differs by scenario: 83% in the first scenario, 74% in the second, and 67% in the third.

Annually, the combined wind turbines and photovoltaic panels generate 21,022 kWh of energy, demonstrating the HRES’s capacity to harness clean, renewable sources. The allocation of this energy varies depending on the scenario’s configuration, as illustrated in the pie chart in Figure 4. In the third scenario, in particular, where hydrogen storage is the primary method, 30% of the total energy is sent to the grid as surplus, making it available for local distribution. Additionally, 7.2% of the energy is allocated to desalination, ensuring a continuous supply of potable water, while 11.1% is consumed directly by residential and commercial users.

The data in Figure 4 are derived from a detailed simulation of the HRES operation, utilizing 30 min energy production data over a 10-year period. The simulation prioritizes energy allocation for desalination, residential and commercial consumption, and storage (both pumped hydro and hydrogen), while also accounting for energy losses and surplus energy. This approach provides an accurate representation of the system’s performance and energy distribution.

A significant portion, 24.3%, is allocated for pumped hydro storage, underscoring its role in maintaining energy reserves. Meanwhile, 13.2% is used for hydrogen production, enabling energy storage for periods of high demand or low renewable generation. Despite the system’s overall efficiency, 14.2% of the energy is lost due to storage limitations and fluctuations in real-time demand, highlighting the potential benefits of further optimization and integration of additional storage technologies.

While Figure 4 specifically illustrates the third scenario, the overall energy distribution trends remain consistent across all scenarios. The key difference lies in how storage is managed: in scenarios without hydrogen storage, the energy designated for hydrogen production is lost as surplus energy, and in scenarios without pumped hydro storage, the energy allocated for pumping is similarly discarded. This ensures that the insights derived from the third scenario provide a representative understanding of energy distribution dynamics across all configurations.

Figure 5 illustrates the average daily fluctuations in water reservoir volume over the course of a year, highlighting seasonal variations in water usage and storage. During the summer months (from June to August), reservoir levels drop significantly, falling below 50,000 m³, coinciding with peak tourist activity and increased water demand. In contrast, the highest water levels, reaching up to 175,000 m³, occur during winter and early spring, particularly in February and March.

These fluctuations highlight the necessity of efficient water management strategies to ensure a stable supply throughout the year. The data indicate that maintaining higher reserves during the off-peak season is essential for meeting elevated summer consumption, emphasizing the importance of effective storage solutions and resource planning.

In Figure 6, the chart illustrates the average daily hydrogen storage levels in the tank over the course of a year, measured in kilograms. These values were obtained through simulation, utilizing surplus renewable energy for hydrogen production via electrolysis. The calculations, based on Equation (4), account for an electrolysis efficiency of 75% and an energy requirement of 45 kWh per kilogram of hydrogen produced.

The data reveal distinct seasonal fluctuations, with hydrogen storage levels declining during the summer months (from June to August). This reduction corresponds to increased electricity demand during the peak tourist season, leading to higher hydrogen consumption. Conversely, the highest storage levels occur in February, exceeding 2000 kg, reflecting a period of lower energy demand and efficient storage utilization.

By June, storage levels approach near depletion, emphasizing the reliance on hydrogen reserves to meet summer electricity needs. These trends highlight the necessity of optimizing hydrogen production and storage strategies during periods of lower demand to ensure sufficient reserves for high-consumption seasons. This approach enhances system reliability and ensures stable energy availability throughout the year.

Figure 5 and Figure 6 reveal a similar seasonal trend in water reservoir levels and hydrogen storage, both of which decline significantly during the summer months due to increased demand for water and energy. Conversely, they rise again in winter as demand decreases and a surplus of renewable energy is stored.

Figure 7 presents a monthly breakdown of electricity demand and production on the island, showcasing the contributions of wind turbines, solar panels, hydroelectric power, and hydrogen storage. This chart highlights the balance between energy supply and demand throughout the year and illustrates the role of different renewable sources in sustaining the island’s electricity needs.

The energy production values depicted in Figure 7 were derived through simulation models utilizing historical weather patterns and system performance data. The wind turbine output was calculated using Equation (1), which factors in wind speed and the turbine’s power curve, adjusted for hub height. Solar energy production was estimated using Equation (2), incorporating solar irradiance, panel efficiency, and the performance ratio. Hydroelectric energy calculations followed Equation (3), considering head height, water flow rate, and turbine efficiency. Hydrogen production and conversion back to electricity were modeled based on available surplus renewable energy, as outlined in Equation (4).

Wind turbine energy generation fluctuates throughout the year, peaking during winter and early spring when wind speeds are highest. In contrast, solar energy output follows sunlight availability, reaching its maximum in summer when daylight hours are longest. This natural variation between wind and solar energy helps maintain a more consistent power supply across different seasons.

Figure 7 also highlights the stabilizing role of hydroelectric power and hydrogen storage. Pumped hydro storage ensures electricity availability when wind and solar alone are insufficient, while hydrogen storage provides a flexible backup, supplying energy during peak demand or periods of low renewable generation.

A key takeaway from Figure 7 is the seasonal disparity between energy production and demand. Electricity consumption spikes in summer, primarily due to tourism, but is partially offset by increased solar energy generation. In winter, despite stronger wind energy output, there are instances where demand exceeds supply. This underlines the critical need for efficient energy storage and management strategies to maintain a stable and reliable energy system year-round.

The pumped storage method achieves an energy efficiency of 81%, while the hydrogen storage method has an efficiency of 45%.

3.2. Cost and CO₂ Analysis

A cost–benefit analysis was conducted to assess the economic viability of the system, incorporating both financial performance and CO₂ emission reductions. Environmental taxes were also factored into the evaluation. The analysis was performed for each scenario, drawing from data in previous studies [43]. The reduction in CO₂ emissions was calculated by multiplying the annual electricity generated by the HRES by the diesel emission factor of 0.64 kg CO₂ per kWh, reflecting the emissions that would have occurred under conventional fossil-fuel generation.

Table 2. Installation costs for each scenario.

	Scenario 1 (EUR)	Scenario 2 (EUR)	Scenario 3 (EUR)
Wind turbines	10,000,000	10,000,000	10,000,000
Solar panels	800,000	800,000	800,000
Desalination	1,500,000	1,500,000	1,500,000
Pumped storage	3,000,000	3,000,000	-
Hydrogen system	1,500,000	-	1,500,000
Total	16,800,000	15,300,000	13,800,000

outlines the installation costs for the three scenarios, providing a breakdown of expenses related to key components, including wind turbines, solar panels, desalination units, pumped storage, and hydrogen systems. These cost estimates are based on findings from prior research [31,44,45]. Each scenario explores a different combination of energy storage technologies, aiming to balance cost-effectiveness with system performance optimization.

Scenario 1 integrates both pumped hydroelectric storage and hydrogen storage, resulting in the highest total installation cost of EUR 16,800,000. The increased expense reflects the additional infrastructure needed for dual storage capabilities, which enhances system flexibility and reliability.

Scenario 2 relies exclusively on pumped hydroelectric storage, leading to a slightly lower installation cost of EUR 15,300,000. The absence of hydrogen storage reduces costs while still providing an effective energy storage solution.

Scenario 3 employs only hydrogen storage, making it the most cost-effective option with a total installation cost of EUR 13,800,000. While hydrogen storage offers a flexible energy solution, its lower efficiency compared to pumped hydroelectric storage presents a trade-off in performance.

These cost comparisons highlight the balance required between investment, storage technology, and system efficiency. While Scenario 1 requires a higher initial investment, its comprehensive energy storage approach improves system stability and reliability. On the other hand, Scenarios 2 and 3 offer more budget-conscious alternatives but may face limitations, particularly during peak electricity demand periods.

Annual operation and maintenance costs play a crucial role in ensuring the system’s long-term functionality and efficiency. These expenses cover routine maintenance, repairs, equipment inspections, and necessary upgrades. Additionally, they account for the upkeep of wind turbines, solar panels, desalination units, and other infrastructure, along with the workforce and technical expertise required.

The distribution of these costs varies depending on installation size, environmental conditions, and system configuration.

Table 3. Operation and maintenance costs for each scenario.

	Scenario 1 (EUR)	Scenario 2 (EUR)	Scenario 3 (EUR)
Personnel	200,000	150,000	150,000
Wind turbines	100,000	100,000	100,000
Solar panels	30,000	30,000	30,000
Desalination	150,000	150,000	150,000
Pumped storage	100,000	100,000	-
Hydrogen system	200,000	-	200,000
Total	780,000	530,000	630,000

provides a detailed breakdown of operation and maintenance costs for each scenario, offering insight into the long-term financial viability and sustainability of the hybrid energy system. Cost estimates are derived from previous studies [46,47,48].

According to the data in Table 3, the annual operation and maintenance costs amount to EUR 780,000 for Scenario 1 (pumped storage and hydrogen), EUR 530,000 for Scenario 2 (pumped storage only), and EUR 630,000 for Scenario 3 (hydrogen storage only).

The project has a payback period of 10 years [15]. Over this timeframe, the total installation and operational costs are as follows: EUR 24,600,000 for Scenario 1, EUR 20,600,000 for Scenario 2, and EUR 20,100,000 for Scenario 3.

These findings are consistent with Żołądek et al. [9], who reported a 97% reduction in fossil fuel use for hybrid renewable systems in off-grid islands. In the case of Skyros, the diesel unit’s annual emissions amount to 9,600,000 kg CO₂-equivalent [33], resulting in an environmental tax of approximately EUR 1,000,000. With the implementation of the HRES, emissions are eliminated, removing this tax burden. Specifically, based on energy production, the system achieves annual tax savings of EUR 709,978 in Scenario 1, EUR 637,805 in Scenario 2, and EUR 577,498 in Scenario 3.

Revenue is generated from both desalinated water and electricity sales. Annually, the system produces 503,289 m³ of desalinated water across all scenarios. In terms of electricity, Scenario 1 generates 12,326 MWh per year, Scenario 2 produces 11,073 MWh, and Scenario 3 delivers 10,026 MWh.

Based on these production values, the marginal selling prices for desalinated water and electricity were calculated. The price of desalinated water remains consistent across all scenarios at EUR 1/m³, as each scenario yields the same water output. However, electricity prices vary due to differences in system costs and energy production levels. The marginal selling price for electricity is EUR 0.101/kWh in Scenario 1, EUR 0.083/kWh in Scenario 2, and EUR 0.093/kWh in Scenario 3. Scenario 2 (pumped storage) has the lowest electricity price, while Scenario 1 (pumped storage and hydrogen) has the highest.

This analysis prioritizes marginal selling prices over the levelized cost of energy (LCOE) to provide practical insights into each scenario’s operational costs and revenue potential. Marginal prices were calculated by dividing the total annual OPEX and CAPEX by the yearly output of desalinated water and electricity. This approach offers a clear and direct comparison of economic implications for end users, emphasizing the immediate financial feasibility of each system configuration.

A net present value (NPV) analysis was conducted to assess the long-term economic feasibility of the proposed system. The analysis considered time horizons of 10 and 25 years and applied discount rates ranging from 0% to 8% with 2% increments. NPV represents the value resulting from discounting to the present all the projected annual net cash flows over the entire time horizon of an investment and is expressed by Equation (6) [13].

$$NPV=\left[\sum _{t=1}^n{\displaystyle \frac{{NPV}_t}{{(1+i)}^t}}\right]-K$$

(6)

In Equation (6), n (years) is the lifespan of the project, i (%) is the discount rate, t (years) is the discounting period, and K (EUR) is the initial investment. The project’s time horizon, that is, the lifespan of the technical equipment, is assumed to be 25 years. The internal rate of return (IRR) is the indicator that measures the profitability of an investment and represents the interest rate at which the NPV equals zero [15].

4. Discussion

This study evaluates the reliability of HRESs that integrate wind turbines, photovoltaics, pumped hydro storage, and hydrogen storage to meet both water and electricity demands in isolated regions. Using Skyros Island as a case study, three scenarios were analyzed: one combining pumped hydro and hydrogen storage, one utilizing only pumped hydro storage, and one relying solely on hydrogen storage.

The results indicate that the hybrid system combining both pumped hydro and hydrogen storage (Scenario 1) is the most reliable solution, covering 99.99% of water demand and 83% of electricity demand. Additionally, it achieves a substantial environmental benefit by reducing CO₂ emissions by 9600 tons annually. This dual-storage configuration enhances system stability while maintaining economic feasibility, with a projected payback period of 10 years. Similar studies have highlighted the advantages of hybrid systems in reducing reliance on fossil fuels. Żołądek et al. [9], for instance, demonstrated a 97% decrease in fossil fuel use for a similar HRES on a Greek island, with an estimated payback period of 11–15 years, aligning with the economic performance observed in this study.

Previous research has shown that standalone wind or solar systems often struggle to meet electricity demand for water-intensive applications, particularly during periods of low resource availability [10]. By integrating pumped hydro storage and hydrogen production, this study ensures a more reliable energy supply. For example, Coelho et al. [17] reported a 60% reduction in grid energy dependence when wind power was combined with solar energy, a finding consistent with the outcomes presented here.

Efficiency analysis underlines the differences between storage technologies. Pumped hydro storage, with an efficiency of 81% (calculated using Equation (5)), demonstrates minimal energy losses during the pumping and electricity generation process. In contrast, hydrogen storage has a lower efficiency of 45%, accounting for losses during electrolysis and reconversion. These findings highlight the need to balance efficiency with flexibility when designing HRES solutions for isolated regions with fluctuating energy demands.

The cost–benefit analysis shows that, while Scenario 1 requires the highest initial investment, it delivers the greatest CO₂ savings and operational efficiency, making it the most sustainable option in the long run. Marginal cost analysis further supports this conclusion, with desalinated water priced at EUR 1/m³ and electricity at EUR 0.101/kWh. These competitive rates reinforce the financial viability of the hybrid system, ensuring affordable access to water and energy for the local population.

In contrast, the scenarios utilizing only pumped hydro (Scenario 2) or only hydrogen storage (Scenario 3) resulted in lower energy coverage and higher marginal energy costs. This underscores the benefits of integrating multiple storage technologies for improved system performance. Scenario 2 had the lowest marginal electricity cost at EUR 0.083/kWh but covered just 74% of the electricity demand, while Scenario 3 had a marginal cost of EUR 0.093/kWh and met only 67% of the demand. Despite these differences, the cost of desalinated water remained stable at EUR 1/m³ across all scenarios, demonstrating the system’s ability to maintain affordability irrespective of the chosen storage method.

The seasonal variation in both water and hydrogen storage (Figure 5 and Figure 6) directly influences energy costs. During the summer, increased reliance on hydrogen storage for desalination leads to higher operational expenses. In contrast, the surplus of renewable energy during the winter reduces the need for costly energy storage, thereby improving economic efficiency.

Regarding storage efficiency, De Moura Altea et al. [11] found that pumped hydro storage is approximately 3 to 4 times more efficient than hydrogen storage in terms of energy and exergy. This study supports that conclusion, as Scenario 2 (pumped hydro) demonstrated the lowest marginal energy cost (EUR 0.083/kWh) and the highest efficiency. However, the results also emphasize the value of hydrogen storage in ensuring system reliability during peak demand periods, particularly in isolated areas with fluctuating energy needs.

Finally, variations in wind speed significantly impact system performance, particularly concerning water desalination. This highlights the importance of using high-resolution (30 min interval) wind data for accurate energy generation and storage optimization. Bertsiou and Baltas [16] also demonstrated the influence of wind variability on cost and efficiency in wind-storage hybrid systems. The findings of this study reaffirm their conclusions, as wind energy plays a crucial role in electricity generation, supported by Skyros Island’s favorable average wind speed of 10 m/s.

The findings of this study provide a framework for planning HRESs in remote, non-interconnected regions. The methodology and simulation approach can be directly applied by local authorities, engineers, and energy planners to assess the feasibility of similar systems in other islands or rural contexts. In particular, the combination of pumped hydro and hydrogen storage offers a scalable solution for addressing seasonal demand fluctuations, while ensuring water and energy autonomy. Moreover, the detailed cost and CO₂ reduction analysis supports decision-making related to environmental policy, public investment, and sustainable infrastructure development.

While this study offers valuable insights into HRES design and performance for isolated regions, some limitations should be acknowledged. The simulations rely on historical climatic and demand data, and future deviations due to climate change or demographic shifts are not fully accounted for. Additionally, constant system efficiencies are assumed, without considering long-term component degradation. These aspects could be refined in future research by incorporating dynamic modeling, uncertainty analysis, and extended environmental assessments.

5. Conclusions

The proposed HRES for Skyros presents a viable solution for off-grid energy and water management, aiming to achieve energy independence, significantly reduce CO₂ emissions, and ensure a reliable and affordable water supply. By integrating pumped hydroelectric and hydrogen storage, the system enhances both efficiency and sustainability, demonstrating how a hybrid approach can effectively address the unique energy and water demands of isolated regions. This model can serve as a reference for similar locations worldwide, promoting renewable energy adoption and strengthening resilience against environmental and economic challenges.

While pumped hydroelectric storage remains one of the most mature and efficient energy storage technologies, it is geographically constrained. In contrast, hydrogen storage offers greater flexibility but operates at a lower efficiency due to energy losses during electrolysis, storage, and conversion back to electricity.

Overall, integrating multiple renewable energy sources with diverse storage methods enables a dynamic and resilient energy management strategy, ensuring year-round reliability for Skyros.

Future research could focus on optimizing HRES through advanced machine learning and AI to improve energy production and storage efficiency. Sustainable solutions for managing desalination byproducts, such as repurposing brine, could further minimize environmental impact. Additionally, adapting the system for other remote regions with different geographical constraints could enhance its broader applicability. Innovations in hydrogen production, particularly green hydrogen and advanced electrolyzers, may improve efficiency and cost-effectiveness. Finally, exploring carbon credit incentives could further enhance the economic feasibility of HRES, supporting long-term energy independence and carbon neutrality for remote communities.