In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?

Firm decisions 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 consultation for the time being.

Experts have warned 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 capability expands.

Hydrogen will be “crucial” for achieving the UKs net-zero target and could fulfill up to a 3rd of the countrys energy needs by 2050, according to the federal government.

In this article, Carbon Brief highlights key points from the 121-page method and examines some of the main talking points around the UKs hydrogen plans.

The UKs brand-new, long-awaited hydrogen technique supplies more detail on how the government will support the advancement of a domestic low-carbon hydrogen sector, which today is virtually non-existent.

Why does the UK require a hydrogen strategy?

The level of hydrogen use in 2050 envisaged by the technique is rather greater than set out by the CCC in its newest recommendations, but covers a comparable variety to other studies.

A current All Party Parliamentary Group report on the role of hydrogen in powering market included a list of demands, specifying that the federal government must “expand beyond its existing dedications of 5GW production in the forthcoming hydrogen technique”. This call has actually been echoed by some industry groups.

There were also over 100 recommendations to hydrogen throughout the governments energy white paper, reflecting its potential usage in numerous sectors. It also includes in the commercial and transport decarbonisation strategies launched previously this year.

The file consists of an expedition of how the UK will expand production and produce a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has actually been aiming to import hydrogen from abroad.

Hydrogen is widely viewed as a crucial component in plans to accomplish net-zero emissions and has been the topic of substantial hype, with lots of nations prioritising it in their post-Covid green healing strategies.

The strategy likewise called for a ₤ 240m net-zero hydrogen fund, the creation of a hydrogen neighbourhood heated with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to reduce dependence on natural gas.

In its new strategy, the UK federal government makes it clear that it sees low-carbon hydrogen as a crucial part of its net-zero strategy, and says it wants the nation to be a “international leader on hydrogen” by 2030.

Hydrogen development for the next decade is anticipated to begin gradually, with a government aspiration to “see 1GW production capacity by 2025” set out in the strategy.

Hydrogen demand (pink area) and percentage of final energy consumption in 2050 (%). The main variety is based on illustrative net-zero constant circumstances in the sixth carbon budget impact assessment and the full range is based on the entire variety from hydrogen method analytical annex. Source: UK hydrogen technique.

In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the best ways of decarbonisation.

Prior to the brand-new strategy, the prime ministers 10-point plan in November 2020 included plans to produce 5 gigawatts (GW) of annual low-carbon hydrogen production capability in the UK by 2030. Currently, this capability stands at essentially zero.

Companies such as Equinor are pressing on with hydrogen advancements in the UK, however market figures have alerted that the UK risks being left. Other European nations have promised billions to support low-carbon hydrogen expansion.

As with most of the governments net-zero strategy files so far, the hydrogen plan has actually been delayed by months, resulting in uncertainty around the future of this fledgling industry.

Its adaptability indicates it can be utilized to take on emissions in “hard-to-abate” sectors, such as heavy market, however it presently suffers from high prices and low performance..

However, the Climate Change Committee (CCC) has noted that, in order to strike the UKs carbon budget plans and achieve net-zero emissions, choices in locations such as decarbonising heating and cars require to be made in the 2020s to allow time for facilities and lorry stock modifications.

The method does not increase this target, although it keeps in mind that the government is “mindful of a prospective pipeline of over 15GW of tasks”.

Today we have released the UKs very first Hydrogen Strategy! This is our strategy to: kick-start a whole industry release the market to cut costs ramp up domestic production unlock ₤ 4bn of private capital support 9k jobs #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.

However, as the chart below shows, if the governments plans come to fulfillment it could then expand significantly– making up in between 20-35% of the countrys overall energy supply by 2050. This will require a major growth of infrastructure and skills in the UK.

Critics also characterise hydrogen– most of which is presently made from gas– as a way for fossil fuel companies to preserve the status quo. (For all the advantages and drawbacks of hydrogen, see Carbon Briefs in-depth explainer.).

What range of low-carbon hydrogen will be prioritised?

The CCC has previously specified that the government needs to “set out [a] vision for contributions of hydrogen production from various paths to 2035” in its hydrogen technique.

Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a statement that the government should “live to the danger of gas market lobbying causing it to dedicate too greatly to blue hydrogen and so keeping the nation locked into fossil fuel-based technology”.

Short (ideally) reviewing this blue hydrogen thing. Essentially, the papers computations possibly represent a case where blue H ₂ is done actually terribly & & with no practical policies. And then cherry-picked an environment metric to make it look as bad as possible. https://t.co/Jx0FdDfdx5— David Joffe (@david_joffe) August 13, 2021.

The document does not do that and instead says it will provide “additional detail on our production method and twin track technique by early 2022”.

The CCC has actually formerly specified “ideal emissions decreases” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas savings”.

In May, S&P Global Platts reported that Rita Wadey– hydrogen economy deputy director at the Department for Business, Energy & & Industrial Strategy (BEIS)– said that, rather than “blue” or “green”, the UK would “consider carbon intensity as the primary factor in market development”.

It has actually likewise launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which takes a look at optimum appropriate levels of emissions for low-carbon hydrogen production and the approach for computing these emissions.

Close.
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For an offered quantity, various greenhouse gases trap different quantities of heat in the atmosphere, a quantity called … Read More.

The chart below, from a document laying out hydrogen expenses released alongside the primary strategy, shows the anticipated decreasing cost of electrolytic hydrogen over time (green lines). (This consists of hydrogen used grid electrical power, which is not technically green unless the grid is 100% sustainable.).

The federal government has actually released a consultation on low-carbon hydrogen requirements to accompany the method, with a pledge to “finalise design components” of such standards by early 2022.

Prof Robert Gross, director of the UK Energy Research Centre, tells Carbon Brief that, in his view, it is “probably a bit unhelpful to get too preoccupied with the green vs blue hydrogen debate”. He states:.

For its part, the CCC has advised a “blue hydrogen bridge” as a helpful tool for achieving net-zero. It states enabling some blue hydrogen will reduce emissions much faster in the short-term by changing more fossil fuels with hydrogen when there is not adequate green hydrogen readily available..

The figure listed below from the consultation, based upon this analysis, shows the impact of setting a threshold 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.

The technique specifies that the proportion of hydrogen supplied by specific technologies “depends upon a range of presumptions, which can just be tested through the marketplaces response to the policies set out in this method and real, at-scale deployment of hydrogen”..

As it stands, blue hydrogen made using steam methane reformation (SMR) is the most affordable low-carbon hydrogen offered, according to government analysis consisted of in the technique. (For more on the relative expenses of various hydrogen varieties, see this Carbon Brief explainer.).

Supporting a range of projects will give the UK a “competitive benefit”, according to the federal government. Germany, by contrast, has stated it will focus specifically on green hydrogen.

Environmental groups and lots of scientists are sceptical about blue hydrogen given its associated emissions.

The brand-new technique mostly prevents using this colour-coding system, however it says the government has dedicated to a “twin track” technique that will include the production of both ranges.

Contrast of rate quotes throughout various innovation types at central fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.

Nevertheless, there was significant pushback on this conclusion, with other researchers– consisting of CCC head of carbon budget plans, David Joffe– pointing out that it counted on extremely high methane leakage and a short-term measure of international warming potential that stressed the impact of methane emissions over CO2.

Glossary.

In the example chosen for the assessment, natural gas routes where CO2 capture rates are listed below around 85% were left out..

” If we want to demonstrate, trial, start to commercialise and after that present using hydrogen in industry/air travel/freight or any place, then we need enough hydrogen. We cant wait till the supply side considerations are total.”.

The strategy keeps in mind that, in many cases, hydrogen used electrolysers “could end up being cost-competitive with CCUS [carbon storage, capture and utilisation] -allowed methane reformation as early as 2025”..

Green hydrogen is used electrolysers powered by eco-friendly electricity, while blue hydrogen is made using natural gas, with the resulting emissions captured and stored..

The previous is essentially zero-carbon, but the latter can still lead to emissions due to methane leakages from gas facilities and the fact that carbon capture and storage (CCS) does not record 100% of emissions..

At the heart of many discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.

CO2 equivalent: Greenhouse gases can be expressed in regards to co2 equivalent, or CO2eq. For a given quantity, different greenhouse gases trap various quantities of heat in the environment, an amount called the global warming potential. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not simply co2.

This opposition capped when a recent study resulted in headings stating that blue hydrogen is “even worse for the environment than coal”.

The CCC has actually warned that policies must develop both blue and green choices, “rather than simply whichever is least-cost”.

How will hydrogen be utilized in various sectors of the economy?

” Stronger signals of intent could steer public and private investments into those areas which include most worth. The federal government has not plainly set out how to choose which sectors will gain from the initial scheduled 5GW of production and has instead mostly left this to be identified through trials and pilots.”.

Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen method.

So, my lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! For anyone brand-new to all this, the ladder is my attempt to put use cases for tidy hydrogen into some sort of benefit order, because not all usage cases are similarly likely to succeed. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021.

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”. Phase 2 of the ₤ 315m Industrial Energy Transformation Fund.A ₤ 55 million Industrial Fuel Switching 2 competition in 2021.

Low-carbon hydrogen can be used to do whatever from fuelling vehicles to heating homes, the truth is that it will likely be restricted by the volume that can feasibly be produced.

” As the method confesses, there will not be significant amounts of low-carbon hydrogen for some time. [] we require to utilize it where there are few options and not as a like-for-like replacement of gas,” Dr Jan Rosenow, director of European programmes at the Regulatory Assistance Project, in a declaration.

One notable exemption is hydrogen for fuel-cell automobile. This follows the governments focus on electric cars and trucks, which lots of scientists view as more efficient and cost-effective technology.

Coverage of the report and government promotional materials stressed that the federal governments strategy would provide adequate hydrogen to replace gas in around 3m homes each year.

Responding to the report, energy researchers pointed to the “miniscule” volumes of hydrogen anticipated to be produced in the near future and advised the government to choose its concerns carefully.

The brand-new technique is clear that industry will be a “lead choice” for early hydrogen use, beginning in the mid-2020s. It likewise says that it will “likely” be essential for decarbonising transport– particularly heavy products cars, shipping and aviation– and stabilizing a more renewables-heavy grid.

Juliet Phillips, senior policy advisor and UK hydrogen expert at thinktank E3G tells Carbon Brief the method had “left open” the door for usages that “dont add the most value for the environment or economy”. She adds:.

Nevertheless, the starting point for the variety– 0TWh– recommends there is significant unpredictability compared to other sectors, and even the highest price quote is just around a 10th of the energy currently utilized to heat UK homes.

Government analysis, consisted of in the technique, suggests potential hydrogen need of approximately 38 terawatt-hours (TWh) by 2030, not consisting of mixing it into the gas grid, and increasing to 55-165TWh by 2035.

The CCC does not see substantial use of hydrogen beyond these limited cases by 2035, as the chart below programs.

It contains prepare for hydrogen heating trials and assessment on “hydrogen-ready” boilers by 2026.

The committee emphasises that hydrogen use must be limited to “areas less suited to electrification, particularly shipping and parts of industry” and supplying versatility to the power system.

Michael Liebrich of Liebreich Associates has arranged the use of low-carbon hydrogen into a “ladder”, with present applications– such as the chemicals industry– provided leading concern.

The method also consists of the alternative of utilizing hydrogen in sectors that may be much better served by electrification, especially domestic heating, where hydrogen has to compete with electrical heat pumps..

Some applications, such as commercial heating, may be virtually impossible without a supply of hydrogen, and numerous professionals have argued that these hold true where it must be prioritised, at least in the short-term.

However, in the actual report, the government stated that it expected “overall the demand for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. The federal government is more positive about the use of hydrogen in domestic heating. Its analysis recommends that as much as 45TWh of low-carbon hydrogen might be put to this use by 2035, as the chart listed below suggests. This remains in line with the CCCs suggestion for its net-zero path, which sees low-carbon hydrogen scaling approximately 90TWh by 2035-- around a 3rd of the size of the existing power sector. Commitments made in the brand-new technique consist of:. 4) On page 62 the hydrogen technique states that the federal government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. Current energy demand in the UK for area and hot water heating is 435 TWh according to Ofgem. So 1 TWh is 0.2%. Thats about 67,000 houses.-- Jan Rosenow (@janrosenow) August 17, 2021. Much will hinge on the development of expediency research studies in the coming years, and the governments approaching heat and structures technique may likewise supply some clarity. " I would suggest to opt for these no-regret choices for hydrogen demand [in market] that are currently offered ... those ought to be the focus.". Gniewomir Flis, a project supervisor at Agora Energiewende, informs Carbon Brief that-- in his view-- mixing "has no future". He discusses:. In order to develop a market for hydrogen, the federal government states it will analyze mixing up to 20% hydrogen into the gas network by late 2022 and objective to make a final decision in late 2023. How does the federal government strategy to support the hydrogen market? These contracts are designed to get rid of the cost gap in between the favored technology and nonrenewable fuel sources. Hydrogen producers would be provided a payment that bridges this gap. " This will offer us a much better understanding of the mix of production technologies, how we will satisfy a ramp-up in demand, and the function that new innovations might play in accomplishing the levels of production essential to fulfill our future [6th carbon budget plan] and net-zero commitments.". The 10-point strategy included a promise to develop a hydrogen organization design to encourage personal financial investment and a revenue mechanism to provide funding for business model. The brand-new hydrogen technique validates that this company design will be finalised in 2022, enabling the first agreements to be allocated from the start of 2023. This is pending another consultation, which has been released together with the main strategy. Hydrogen need (pink area) and proportion of last energy usage in 2050 (%). My lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! Call for proof on phaseout of carbon-intensive hydrogen production in market "within a year"." As the method confesses, there wont be substantial amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method specifies that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. Now that its strategy has actually been released, the government says it will gather evidence from assessments on its low-carbon hydrogen requirement, net-zero hydrogen fund and business model:. Sharelines from this story. Much of the resulting press coverage of the hydrogen method, from the Financial Times to the Daily Telegraph, concentrated on the strategy for a hydrogen industry "subsidised by taxpayers", as the cash would originate from either higher costs or public funds. Anne-Marie Trevelyan-- minister for energy, tidy growth and environment modification at BEIS-- informed the Times that the cost to supply long-term security to the market would be "really small" for private households. As it stands, low-carbon hydrogen stays pricey compared to fossil fuel options, there is uncertainty about the level of future demand and high risks for business intending to enter the sector. According to the governments news release, its favored model is "constructed on a similar facility to the offshore wind contracts for distinction (CfDs)", which substantially cut costs of brand-new overseas wind farms.

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