Integrated Renewable Energy for Urban and Remote Communities: Hybrid Solutions with Hydro Pumped Storage and Green Hydrogen Opportunities

ABSTRACT Urban and remote communities face persistent challenges associated with centralized power grids. This study investigates the potential of hybrid renewable energy systems with integrated storage solutions as a decentralized alternative to improve efficiency and resilience. The research combines a comprehensive theoretical review of configurations, focusing on hydro pumped storage and hydrogen storage, with the development and application of an optimization model for a remote community exposed to desertification risks. Generation and surplus forecasts were used to evaluate storage strategies, and a multicriteria optimization algorithm was applied to enhance demand–supply matching. The base‐case system consists of 13.5 kW of hydropower, 20 kW of solar PV, and 6 kW of wind capacity, assessed over a 35‐year project lifetime. Results indicate that solar and hydropower contribute approximately 90% of total generation, achieving a levelized cost of energy of 0.05 €/kWh, an internal rate of return of 17.5%, and a payback period of 5 years. The system can export up to 42 000 kWh annually to the grid or nearby users. Additionally, the integration of green hydrogen provides further flexibility, resulting in a levelized cost of hydrogen of 3.5 €/kg, an IRR of 10%, and a 14‐year payback period.