Carbon capture and utilization is an attractive technique to mitigate the damage to the environment. The aim of this study was to techno-economically investigate the hydrogenation of CO₂ to methanol and then conversion of methanol to dimethyl ether using Aspen Plus^® (V.11, Aspen Technology, Inc., Bedford, Massachusetts 01730, USA). Hydrogen was obtained from alkaline water electrolysis, proton exchange membrane and solid oxide electrolysis processes for methanol production. The major cost contributing factor in the methanol production was the cost of hydrogen production; therefore, the cost per ton of methanol was highest for alkaline water electrolysis and lowest for solid oxide electrolysis. The specific cost of methanol for solid oxide electrolysis, proton exchange membrane and alkaline water electrolysis was estimated to be 701 $/ton, 760 $/ton and 920 $/ton, respectively. Similarly, the specific cost of dimethyl ether was estimated to be 1141 $/ton, 1230 $/ton and 1471 $/ton, using solid oxide electrolysis, proton exchange membrane and alkaline water electrolysis based hydrogen production, respectively. The cost for methanol and dimethyl ether production by proton exchange membrane was slightly higher than for the solid oxide electrolysis process. However, the proton exchange membrane operates at a lower temperature, consequently leading to less operational issues.