In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
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The UKs new, long-awaited hydrogen method provides more information on how the government will support the advancement of a domestic low-carbon hydrogen sector, which today is practically non-existent.
Firm choices around the degree of hydrogen usage in domestic heating and how to guarantee it is produced in a low-carbon way have actually been delayed or put out to assessment for the time being.
Experts have alerted that, with hydrogen in brief supply in the coming years, the UK must prioritise it in “hard-to-electrify” sectors such as heavy industry as capacity expands.
In this post, Carbon Brief highlights crucial points from the 121-page method and takes a look at a few of the main talking points around the UKs hydrogen plans.
Why does the UK need a hydrogen method?
The document includes an expedition of how the UK will expand production and develop a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has actually been wanting to import hydrogen from abroad.
Hydrogen is widely seen as an important element in strategies to achieve net-zero emissions and has been the topic of significant hype, with many countries prioritising it in their post-Covid green recovery plans.
Prior to the brand-new strategy, the prime ministers 10-point plan in November 2020 included plans to produce 5 gigawatts (GW) of yearly low-carbon hydrogen production capacity in the UK by 2030. Currently, this capacity stands at practically zero.
The strategy likewise called for a ₤ 240m net-zero hydrogen fund, the creation of a hydrogen area warmed with the gas by 2023, and increasing hydrogen mixing into gas networks to 20% to minimize dependence on gas.
A recent All Party Parliamentary Group report on the role of hydrogen in powering market consisted of a list of needs, specifying that the federal government needs to “expand beyond its existing commitments of 5GW production in the forthcoming hydrogen strategy”. This call has been echoed by some market groups.
Nevertheless, similar to many of the governments net-zero method files so far, the hydrogen plan has been delayed by months, resulting in unpredictability around the future of this recently established industry.
Today we have published the UKs first Hydrogen Strategy! This is our plan to: kick-start a whole market unleash the market to cut costs increase domestic production unlock ₤ 4bn of personal capital assistance 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
Critics likewise characterise hydrogen– the majority of which is currently made from gas– as a way for nonrenewable fuel source business to preserve the status quo. (For all the benefits and disadvantages of hydrogen, see Carbon Briefs thorough explainer.).
Its versatility means it can be used to deal with emissions in “hard-to-abate” sectors, such as heavy market, but it presently struggles with high rates and low effectiveness..
The Climate Change Committee (CCC) has actually kept in mind that, in order to hit the UKs carbon budgets and accomplish net-zero emissions, decisions in areas such as decarbonising heating and vehicles require to be made in the 2020s to permit time for facilities and car stock modifications.
In its brand-new method, the UK government makes it clear that it sees low-carbon hydrogen as a crucial part of its net-zero plan, and states it desires the nation to be a “global leader on hydrogen” by 2030.
Hydrogen growth for the next decade is anticipated to begin slowly, with a federal government goal to “see 1GW production capability by 2025” set out in the technique.
Hydrogen demand (pink location) and proportion of final energy intake in 2050 (%). The main range is based upon illustrative net-zero consistent situations in the 6th carbon budget impact assessment and the complete range is based on the entire range from hydrogen technique analytical annex. Source: UK hydrogen strategy.
The level of hydrogen use in 2050 envisaged by the strategy is rather higher than set out by the CCC in its newest guidance, however covers a comparable range to other research studies.
Companies such as Equinor are pushing on with hydrogen advancements in the UK, but market figures have warned that the UK threats being left. Other European nations have promised billions to support low-carbon hydrogen expansion.
There were likewise over 100 referrals to hydrogen throughout the federal governments energy white paper, reflecting its possible use in numerous sectors. It also includes in the commercial and transportation decarbonisation techniques launched previously this year.
However, as the chart listed below shows, if the governments strategies concern fruition it might then expand significantly– comprising between 20-35% of the nations overall energy supply by 2050. This will need a significant expansion of facilities and skills in the UK.
The method does not increase this target, although it keeps in mind that the government is “familiar with a potential pipeline of over 15GW of tasks”.
In some applications, hydrogen will take on electrification and carbon capture and storage (CCS) as the very best methods of decarbonisation.
What range of low-carbon hydrogen will be prioritised?
The CCC has actually previously specified “suitable emissions decreases” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
The method mentions that the percentage of hydrogen provided by specific innovations “depends on a variety of assumptions, which can just be checked through the markets response to the policies set out in this method and real, at-scale release of hydrogen”..
CO2 equivalent: Greenhouse gases can be expressed in terms of co2 equivalent, or CO2eq. For a given quantity, various greenhouse gases trap various quantities of heat in the environment, a quantity understood as the global warming capacity. Co2 equivalent is a method of comparing emissions from all greenhouse gases, not just co2.
In May, S&P Global Platts reported that Rita Wadey– hydrogen economy deputy director at the Department for Business, Energy & & Industrial Strategy (BEIS)– stated that, instead of “blue” or “green”, the UK would “think about carbon strength as the primary consider market development”.
There was considerable pushback on this conclusion, with other scientists– consisting of CCC head of carbon spending plans, David Joffe– pointing out that it relied on really high methane leak and a short-term measure of global warming potential that emphasised the impact of methane emissions over CO2.
The previous is essentially zero-carbon, however the latter can still lead to emissions due to methane leaks from gas infrastructure and the truth that carbon capture and storage (CCS) does not capture 100% of emissions..
In the example selected for the consultation, natural gas routes where CO2 capture rates are below around 85% were omitted..
The CCC has formerly stated that the government ought to “set out [a] vision for contributions of hydrogen production from various paths to 2035” in its hydrogen technique.
Many researchers and ecological groups are sceptical about blue hydrogen given its associated emissions.
This opposition capped when a current study led to headlines stating that blue hydrogen is “worse for the climate than coal”.
Glossary.
” If we wish to demonstrate, trial, start to commercialise and after that present the use of hydrogen in industry/air travel/freight or any place, then we need enough hydrogen. We cant wait up until the supply side deliberations are total.”.
As it stands, blue hydrogen made utilizing steam methane reformation (SMR) is the cheapest low-carbon hydrogen available, according to government analysis included in the strategy. (For more on the relative expenses of various hydrogen ranges, see this Carbon Brief explainer.).
The chart below, from a document detailing hydrogen costs released along with the main technique, shows the anticipated declining expense of electrolytic hydrogen over time (green lines). (This consists of hydrogen made using grid electrical energy, which is not technically green unless the grid is 100% sustainable.).
Green hydrogen is used electrolysers powered by sustainable electrical energy, while blue hydrogen is made utilizing gas, with the resulting emissions recorded and stored..
Close.
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a provided quantity, various greenhouse gases trap different amounts of heat in the environment, an amount referred to as … Read More.
The file does not do that and instead says it will provide “further information on our production technique and twin track technique by early 2022”.
The CCC has actually cautioned that policies must establish both green and blue alternatives, “instead of simply whichever is least-cost”.
Comparison of rate estimates throughout different innovation types at central fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.
Short (hopefully) reflecting on this blue hydrogen thing. Basically, the papers computations possibly represent a case where blue H ₂ is done really severely & & with no reasonable policies. And after that cherry-picked a climate metric to make it look as bad as possible. https://t.co/Jx0FdDfdx5— David Joffe (@david_joffe) August 13, 2021.
Prof Robert Gross, director of the UK Energy Research Centre, informs Carbon Brief that, in his view, it is “probably a bit unhelpful to get too preoccupied with the green vs blue hydrogen argument”. He states:.
It has likewise launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which takes a look at optimum acceptable levels of emissions for low-carbon hydrogen production and the method for calculating these emissions.
At the heart of many conversations about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The brand-new technique mostly avoids utilizing this colour-coding system, but it states the federal government has devoted to a “twin track” approach that will include the production of both varieties.
Supporting a variety of jobs will give the UK a “competitive benefit”, according to the government. Germany, by contrast, has said it will focus solely on green hydrogen.
For its part, the CCC has actually suggested a “blue hydrogen bridge” as a helpful tool for accomplishing net-zero. It states permitting some blue hydrogen will reduce emissions much faster in the short-term by changing more nonrenewable fuel sources with hydrogen when there is insufficient green hydrogen offered..
The strategy keeps in mind that, in many cases, hydrogen made utilizing electrolysers “might become cost-competitive with CCUS [carbon storage, utilisation and capture] -allowed methane reformation as early as 2025”..
The government has actually launched a consultation on low-carbon hydrogen standards to accompany the technique, with a pledge to “settle design elements” of such requirements by early 2022.
The figure below from the assessment, based on this analysis, shows the effect of setting a limit of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production approaches above the red line, including some for producing blue hydrogen, would be omitted.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a declaration that the government should “be alive to the danger of gas industry lobbying triggering it to devote too greatly to blue hydrogen and so keeping the nation locked into fossil fuel-based technology”.
How will hydrogen be utilized in various sectors of the economy?
Reacting to the report, energy scientists indicated the “small” volumes of hydrogen anticipated to be produced in the near future and prompted the government to pick its top priorities carefully.
Some applications, such as commercial heating, might be essentially difficult without a supply of hydrogen, and numerous specialists have actually argued that these hold true where it ought to be prioritised, a minimum of in the brief term.
Government analysis, included in the strategy, suggests prospective hydrogen need of up to 38 terawatt-hours (TWh) by 2030, not including mixing it into the gas grid, and rising to 55-165TWh by 2035.
Juliet Phillips, senior policy consultant and UK hydrogen expert at thinktank E3G informs Carbon Brief the technique had “exposed” the door for usages that “dont include the most worth for the environment or economy”. She adds:.
Require evidence on “hydrogen-ready” commercial devices by the end of 2021. Require proof on phaseout of carbon-intensive hydrogen production in industry “within a year”. Stage 2 of the ₤ 315m Industrial Energy Transformation Fund.A ₤ 55 million Industrial Fuel Switching 2 competitors in 2021.
It consists of prepare for hydrogen heating trials and assessment on “hydrogen-ready” boilers by 2026.
Commitments made in the new method include:.
The government is more optimistic about using hydrogen in domestic heating. Its analysis suggests that approximately 45TWh of low-carbon hydrogen might be put to this use by 2035, as the chart below shows.
The technique also consists of the choice of using hydrogen in sectors that may be much better served by electrification, especially domestic heating, where hydrogen has to compete with electrical heat pumps..
In the real report, the government stated that it expected “overall the need for low carbon hydrogen for heating by 2030 to be fairly low (<< 1TWh)".. " As the strategy admits, there will not be substantial quantities of low-carbon hydrogen for some time. [] we need to utilize it where there are couple of options and not as a like-for-like replacement of gas," Dr Jan Rosenow, director of European programs at the Regulatory Assistance Project, in a statement. The CCC does not see comprehensive use of hydrogen beyond these minimal cases by 2035, as the chart below programs. One noteworthy exemption is hydrogen for fuel-cell automobile. This is consistent with the governments focus on electrical cars, which lots of researchers deem more cost-effective and efficient innovation. " Stronger signals of intent could guide public and private investments into those areas which include most worth. The government has actually not plainly set out how to choose which sectors will benefit from the initial planned 5GW of production and has rather mainly left this to be identified through pilots and trials.". The new method is clear that industry will be a "lead option" for early hydrogen usage, beginning in the mid-2020s. It likewise states that it will "likely" be essential for decarbonising transportation-- especially heavy items vehicles, shipping and air travel-- and stabilizing a more renewables-heavy grid. Michael Liebrich of Liebreich Associates has actually arranged the use of low-carbon hydrogen into a "ladder", with present applications-- such as the chemicals market-- given leading priority. So, my lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! For anybody brand-new to all this, the ladder is my attempt to put use cases for clean hydrogen into some sort of merit order, because not all usage cases are similarly most likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. The committee stresses that hydrogen use ought to be limited to "areas less suited to electrification, particularly shipping and parts of industry" and providing versatility to the power system. However, the starting point for the range-- 0TWh-- suggests there is substantial unpredictability compared to other sectors, and even the highest price quote is just around a 10th of the energy presently used to heat UK homes. Low-carbon hydrogen can be used to do everything from sustaining cars to heating houses, the truth is that it will likely be limited by the volume that can probably be produced. Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen technique. Coverage of the report and government promotional materials stressed that the governments plan would supply sufficient hydrogen to change gas in around 3m homes each year. This remains in line with the CCCs recommendation for its net-zero path, which sees low-carbon hydrogen scaling as much as 90TWh by 2035-- around a third of the size of the existing power sector. 4) On page 62 the hydrogen strategy states that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. Existing energy need in the UK for area and hot water heating is 435 TWh according to Ofgem. 1 TWh is 0.2%. Thats about 67,000 homes.-- Jan Rosenow (@janrosenow) August 17, 2021. Lastly, in order to produce a market for hydrogen, the government states it will take a look at blending up to 20% hydrogen into the gas network by late 2022 and aim to make a final decision in late 2023. Gniewomir Flis, a project supervisor at Agora Energiewende, informs Carbon Brief that-- in his view-- mixing "has no future". He describes:. Much will hinge on the development of expediency research studies in the coming years, and the federal governments upcoming heat and structures method may also provide some clearness. " I would suggest to go with these no-regret alternatives for hydrogen need [in market] that are currently offered ... those need to be the focus.". How does the government plan to support the hydrogen market? Much of the resulting press protection of the hydrogen technique, from the Financial Times to the Daily Telegraph, concentrated on the strategy for a hydrogen industry "subsidised by taxpayers", as the cash would come from either higher bills or public funds. Sharelines from this story. These contracts are developed to overcome the expense space in between the favored innovation and fossil fuels. Hydrogen producers would be given a payment that bridges this space. Hydrogen demand (pink area) and percentage of final energy usage in 2050 (%). My lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! Call for evidence on phaseout of carbon-intensive hydrogen production in industry "within a year"." As the technique confesses, there will not be considerable amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen technique states that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. The 10-point plan consisted of a promise to develop a hydrogen organization design to motivate personal financial investment and a profits mechanism to supply funding for the company model. The brand-new hydrogen method validates that this company design will be settled in 2022, allowing the first contracts to be assigned from the start of 2023. This is pending another consultation, which has been launched together with the primary method. As it stands, low-carbon hydrogen stays expensive compared to nonrenewable fuel source options, there is uncertainty about the level of future need and high risks for companies aiming to enter the sector. Now that its method has been released, the federal government states it will collect proof from assessments on its low-carbon hydrogen standard, net-zero hydrogen fund and business model:. According to the governments news release, its preferred model is "developed on a comparable property to the overseas wind contracts for difference (CfDs)", which significantly cut expenses of brand-new overseas wind farms. Anne-Marie Trevelyan-- minister for energy, clean growth and environment change at BEIS-- informed the Times that the expense to supply long-lasting security to the market would be "really little" for private families. " This will offer us a much better understanding of the mix of production innovations, how we will satisfy a ramp-up in need, and the role that brand-new innovations might play in accomplishing the levels of production required to fulfill our future [sixth carbon spending plan] and net-zero commitments.".