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

The UKs brand-new, long-awaited hydrogen method offers more information on how the federal government will support the advancement of a domestic low-carbon hydrogen sector, which today is essentially non-existent.

Hydrogen will be “important” for achieving the UKs net-zero target and could meet up to a third of the countrys energy requirements by 2050, according to the federal government.

Company choices around the level of hydrogen use in domestic heating and how to ensure it is produced in a low-carbon way have actually been postponed or put out to consultation for the time being.

Professionals have cautioned that, with hydrogen in short supply in the coming years, the UK needs to prioritise it in “hard-to-electrify” sectors such as heavy market as capacity expands.

In this post, Carbon Brief highlights bottom lines from the 121-page strategy and takes a look at some of the primary talking points around the UKs hydrogen strategies.

Why does the UK need a hydrogen technique?

Today we have released the UKs very first Hydrogen Strategy! This is our strategy to: kick-start an entire market unleash the market to cut expenses increase domestic production unlock ₤ 4bn of private capital assistance 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.

However, as the chart below programs, if the federal governments plans come to fruition it could then broaden substantially– comprising in between 20-35% of the countrys overall energy supply by 2050. This will require a major expansion of facilities and skills in the UK.

The level of hydrogen use in 2050 imagined by the strategy is somewhat greater than set out by the CCC in its latest suggestions, however covers a comparable range to other studies.

Nevertheless, similar to most of the governments net-zero strategy files so far, the hydrogen plan has been postponed by months, resulting in uncertainty around the future of this new industry.

Critics also characterise hydrogen– many of which is presently made from natural gas– as a method for nonrenewable fuel source companies to maintain the status quo. (For all the benefits and disadvantages of hydrogen, see Carbon Briefs in-depth explainer.).

Hydrogen is extensively viewed as an essential element in plans to accomplish net-zero emissions and has actually been the subject of substantial hype, with many countries prioritising it in their post-Covid green healing strategies.

However, the Climate Change Committee (CCC) has kept in mind that, in order to strike the UKs carbon budgets and attain net-zero emissions, choices in areas such as decarbonising heating and automobiles need to be made in the 2020s to enable time for facilities and vehicle stock modifications.

A recent All Party Parliamentary Group report on the role of hydrogen in powering industry consisted of a list of demands, stating that the government must “expand beyond its existing commitments of 5GW production in the forthcoming hydrogen strategy”. This call has been echoed by some industry groups.

Companies such as Equinor are continuing with hydrogen advancements in the UK, however market figures have alerted that the UK threats being left. Other European nations have actually promised billions to support low-carbon hydrogen growth.

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

There were also over 100 recommendations to hydrogen throughout the federal governments energy white paper, reflecting its potential usage in numerous sectors. It likewise features in the commercial and transport decarbonisation methods launched earlier this year.

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

Hydrogen demand (pink area) and percentage of last energy intake in 2050 (%). The central variety is based upon illustrative net-zero consistent scenarios in the 6th carbon budget impact assessment and the full variety is based upon the whole range from hydrogen strategy analytical annex. Source: UK hydrogen method.

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

Its adaptability suggests it can be utilized to tackle emissions in “hard-to-abate” sectors, such as heavy market, but it presently struggles with high prices and low efficiency..

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

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

The plan also called for a ₤ 240m net-zero hydrogen fund, the development of a hydrogen area heated with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to decrease dependence on gas.

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

What range of low-carbon hydrogen will be prioritised?

The file does not do that and instead says it will offer “more detail on our production method and twin track approach by early 2022”.

Many researchers and ecological groups are sceptical about blue hydrogen provided its associated emissions.

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

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CO2 equivalent: Greenhouse gases can be expressed in regards to co2 equivalent, or CO2eq. For a given quantity, various greenhouse gases trap different amounts of heat in the atmosphere, a quantity called … Read More.

For its part, the CCC has actually suggested a “blue hydrogen bridge” as an useful tool for accomplishing net-zero. It states permitting some blue hydrogen will lower emissions quicker in the short-term by changing more fossil fuels with hydrogen when there is insufficient green hydrogen available..

Jess Ralston, an analyst 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 therefore keeping the nation locked into fossil fuel-based technology”.

The figure below from the consultation, based on this analysis, reveals the impact of setting a limit of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production techniques above the red line, including some for producing blue hydrogen, would be omitted.

” If we wish to demonstrate, trial, start to commercialise and then present making use of hydrogen in industry/air travel/freight or wherever, then we need enough hydrogen. We cant wait until the supply side deliberations are complete.”.

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

Brief (hopefully) reflecting on this blue hydrogen thing. Basically, the papers estimations possibly represent a case where blue H ₂ is done truly badly & & without any reasonable 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 plan notes that, sometimes, hydrogen used electrolysers “could end up being cost-competitive with CCUS [carbon utilisation, capture and storage] -made it possible for methane reformation as early as 2025”..

The government has actually released an assessment on low-carbon hydrogen standards to accompany the technique, with a promise to “settle style components” of such standards by early 2022.

It has also released 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 methodology for computing these emissions.

The new method largely prevents using this colour-coding system, but it states the government has actually committed to a “twin track” method that will include the production of both ranges.

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 “consider carbon intensity as the primary element in market advancement”.

However, there was significant pushback on this conclusion, with other researchers– including CCC head of carbon budget plans, David Joffe– mentioning that it relied on very high methane leak and a short-term procedure of worldwide warming potential that emphasised the effect of methane emissions over CO2.

Supporting a range of tasks will provide the UK a “competitive benefit”, according to the government. Germany, by contrast, has said it will focus specifically on green hydrogen.

Glossary.

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

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

In the example picked for the consultation, natural gas paths where CO2 capture rates are below around 85% were excluded..

The CCC has alerted that policies need to develop both blue and green options, “instead of simply whichever is least-cost”.

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

As it stands, blue hydrogen used steam methane reformation (SMR) is the most inexpensive low-carbon hydrogen offered, according to federal government analysis included in the strategy. (For more on the relative costs of various hydrogen ranges, see this Carbon Brief explainer.).

The CCC has previously defined “suitable emissions reductions” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.

The chart below, from a file outlining hydrogen expenses released together with the main strategy, shows the expected declining expense of electrolytic hydrogen in time (green lines). (This consists of hydrogen made using grid electrical power, which is not technically green unless the grid is 100% renewable.).

Green hydrogen is used electrolysers powered by renewable electrical power, while blue hydrogen is made utilizing natural gas, with the resulting emissions caught and stored..

CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a given quantity, various greenhouse gases trap various quantities of heat in the atmosphere, an amount known as the international warming capacity. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not just carbon dioxide.

The technique states that the percentage of hydrogen supplied by particular innovations “depends on a series of assumptions, which can only be checked through the markets response to the policies set out in this technique and real, at-scale implementation of hydrogen”..

This opposition capped when a current study led to headlines stating that blue hydrogen is “worse for the climate than coal”.

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

Government analysis, included in the method, recommends possible hydrogen need of up to 38 terawatt-hours (TWh) by 2030, not consisting of blending it into the gas grid, and increasing to 55-165TWh by 2035.

Some applications, such as industrial heating, might be practically impossible without a supply of hydrogen, and numerous professionals have argued that these are the cases where it should be prioritised, at least in the short-term.

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

Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen strategy.

Juliet Phillips, senior policy consultant and UK hydrogen professional at thinktank E3G informs Carbon Brief the method had actually “exposed” the door for usages that “dont add the most worth for the environment or economy”. She includes:.

Reacting to the report, energy researchers pointed to the “little” volumes of hydrogen anticipated to be produced in the near future and prompted the government to choose its top priorities thoroughly.

The brand-new technique is clear that industry will be a “lead alternative” for early hydrogen usage, starting in the mid-2020s. It also says that it will “likely” be essential for decarbonising transportation– especially heavy goods lorries, shipping and air travel– and stabilizing a more renewables-heavy grid.

Coverage of the report and government advertising materials stressed that the governments plan would provide sufficient hydrogen to change natural gas in around 3m houses each year.

The technique also consists of the choice of utilizing hydrogen in sectors that might be better served by electrification, particularly domestic heating, where hydrogen has to complete with electrical heat pumps..

Dedications made in the new strategy include:.

One significant exemption is hydrogen for fuel-cell guest vehicles. This follows the federal governments focus on electric vehicles, which numerous scientists see as more effective and affordable technology.

Michael Liebrich of Liebreich Associates has actually arranged using low-carbon hydrogen into a “ladder”, with existing applications– such as the chemicals industry– given leading priority.

” As the strategy confesses, there wont be substantial amounts of low-carbon hydrogen for some time. [For that reason] 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 programmes at the Regulatory Assistance Project, in a statement.

However, the starting point for the range– 0TWh– recommends there is considerable uncertainty compared to other sectors, and even the greatest quote is just around a 10th of the energy currently utilized to heat UK homes.

In the actual report, the government said that it expected “overall the need for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. The federal government is more optimistic about the usage of hydrogen in domestic heating. Its analysis recommends that approximately 45TWh of low-carbon hydrogen might be put to this use by 2035, as the chart listed below suggests. It contains plans for hydrogen heating trials and consultation on "hydrogen-ready" boilers by 2026. Call for evidence on "hydrogen-ready" industrial devices by the end of 2021. Call for proof on phaseout of carbon-intensive hydrogen production in market "within a year". Stage 2 of the ₤ 315m Industrial Energy Transformation Fund.A ₤ 55 million Industrial Fuel Switching 2 competition in 2021. This is 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. Low-carbon hydrogen can be used to do whatever from fuelling automobiles to heating houses, the truth is that it will likely be restricted by the volume that can feasibly be produced. 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 usage cases for clean hydrogen into some sort of merit order, due to the fact that not all usage cases are equally likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. The committee stresses that hydrogen use need to be restricted to "areas less matched to electrification, especially shipping and parts of industry" and supplying flexibility to the power system. " Stronger signals of intent could guide personal and public investments into those locations which add most worth. The federal government has not clearly laid out how to choose upon which sectors will take advantage of the initial organized 5GW of production and has instead largely left this to be identified through pilots and trials.". 4) On page 62 the hydrogen technique specifies that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. Present energy need 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. " I would recommend to opt for these no-regret choices for hydrogen need [in market] that are currently readily available ... those need to be the focus.". Finally, in order to develop a market for hydrogen, the federal government says it will examine blending approximately 20% hydrogen into the gas network by late 2022 and objective to make a decision in late 2023. Gniewomir Flis, a task supervisor at Agora Energiewende, tells Carbon Brief that-- in his view-- blending "has no future". He explains:. Much will depend upon the progress of feasibility studies in the coming years, and the federal governments approaching heat and buildings method may also supply some clarity. How does the federal government plan to support the hydrogen market? Now that its technique has been published, the government states it will gather evidence from consultations on its low-carbon hydrogen requirement, net-zero hydrogen fund and business model:. As it stands, low-carbon hydrogen stays costly compared to fossil fuel options, there is unpredictability about the level of future need and high risks for business intending to enter the sector. According to the federal governments news release, its favored design is "built on a similar facility to the overseas wind agreements for distinction (CfDs)", which significantly cut costs of new offshore wind farms. " This will provide us a much better understanding of the mix of production innovations, how we will satisfy a ramp-up in demand, and the role that brand-new technologies could play in attaining the levels of production necessary to meet our future [6th carbon spending plan] and net-zero commitments.". Hydrogen demand (pink location) and proportion of final energy intake in 2050 (%). My lovelies, I just 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 admits, there will not be significant amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen technique mentions that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. However, Anne-Marie Trevelyan-- minister for energy, clean development and climate change at BEIS-- informed the Times that the cost to offer long-lasting security to the market would be "very small" for private families. These contracts are created to conquer the expense gap between the preferred technology and fossil fuels. Hydrogen manufacturers would be provided a payment that bridges this space. The 10-point plan consisted of a pledge to develop a hydrogen company model to encourage private investment and an income system to offer funding for business design. Much of the resulting press protection of the hydrogen technique, from the Financial Times to the Daily Telegraph, focused on the strategy for a hydrogen market "subsidised by taxpayers", as the cash would originate from either higher costs or public funds. Sharelines from this story. The new hydrogen strategy validates that this business model will be settled in 2022, making it possible for the very first agreements to be assigned from the start of 2023. This is pending another assessment, which has been released along with the main method.

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