Meanwhile, company decisions around the extent 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.
Professionals have warned that, with hydrogen in short supply in the coming years, the UK must prioritise it in “hard-to-electrify” sectors such as heavy industry as capacity expands.
The UKs new, long-awaited hydrogen strategy provides more information on how the government will support the development of a domestic low-carbon hydrogen sector, which today is virtually non-existent.
Hydrogen will be “crucial” for accomplishing the UKs net-zero target and could consume to a third of the countrys energy by 2050, according to the federal government.
In this short article, Carbon Brief highlights essential points from the 121-page strategy and examines a few of the main talking points around the UKs hydrogen plans.
Why does the UK need a hydrogen strategy?
There were also over 100 references to hydrogen throughout the governments energy white paper, reflecting its potential use in many sectors. It also includes in the industrial and transport decarbonisation methods released earlier this year.
A recent All Party Parliamentary Group report on the role of hydrogen in powering industry included a list of demands, mentioning that the federal government should “expand beyond its existing dedications of 5GW production in the upcoming hydrogen method”. This call has actually been echoed by some industry groups.
Hydrogen need (pink area) and proportion of final energy usage in 2050 (%). The main variety is based upon illustrative net-zero consistent circumstances in the sixth carbon budget plan effect assessment and the full range is based upon the entire range from hydrogen technique analytical annex. Source: UK hydrogen method.
The strategy does not increase this target, although it keeps in mind that the federal government is “familiar with a prospective pipeline of over 15GW of tasks”.
In its new method, the UK federal government makes it clear that it sees low-carbon hydrogen as a key part of its net-zero strategy, and says it desires the nation to be a “worldwide leader on hydrogen” by 2030.
Today we have released the UKs first Hydrogen Strategy! This is our plan to: kick-start a whole industry unleash the market to cut costs ramp up domestic production unlock ₤ 4bn of personal capital assistance 9k jobs #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
Prior to the new technique, the prime ministers 10-point strategy in November 2020 consisted of strategies to produce 5 gigawatts (GW) of yearly low-carbon hydrogen production in the UK by 2030. Currently, this capability stands at practically absolutely no.
The strategy also called for a ₤ 240m net-zero hydrogen fund, the creation of a hydrogen neighbourhood heated up with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to lower dependence on gas.
In some applications, hydrogen will take on electrification and carbon capture and storage (CCS) as the best ways of decarbonisation.
As the chart below shows, if the governments plans come to fulfillment it might then expand considerably– taking up between 20-35% of the nations overall energy supply by 2050. This will need a major expansion of facilities and skills in the UK.
Business such as Equinor are continuing with hydrogen developments in the UK, however market figures have actually cautioned that the UK threats being left behind. Other European countries have actually vowed billions to support low-carbon hydrogen expansion.
Critics likewise characterise hydrogen– many of which is currently made from natural gas– as a method for fossil fuel business to preserve the status quo. (For all the benefits and downsides of hydrogen, see Carbon Briefs thorough explainer.).
Its flexibility implies it can be utilized to deal with emissions in “hard-to-abate” sectors, such as heavy industry, but it presently struggles with high prices and low performance..
The Climate Change Committee (CCC) has noted that, in order to strike the UKs carbon budget plans and achieve net-zero emissions, decisions in locations such as decarbonising heating and lorries require to be made in the 2020s to enable time for facilities and lorry stock changes.
As with most of the governments net-zero technique documents so far, the hydrogen plan has actually been postponed by months, resulting in unpredictability around the future of this fledgling industry.
Hydrogen is commonly seen as a vital element in strategies to achieve net-zero emissions and has actually been the subject of substantial hype, with many nations prioritising it in their post-Covid green healing strategies.
The file consists of an exploration of how the UK will broaden production and create a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has actually been seeking to import hydrogen from abroad.
Hydrogen development for the next decade is expected to start slowly, with a federal government aspiration to “see 1GW production capacity by 2025” set out in the method.
What range of low-carbon hydrogen will be prioritised?
The strategy states that the proportion of hydrogen provided by specific innovations “depends upon a series of presumptions, which can just be tested through the marketplaces response to the policies set out in this strategy and real, at-scale deployment of hydrogen”..
In the example selected for the assessment, natural gas routes where CO2 capture rates are below around 85% were left out..
The new technique largely avoids using this colour-coding system, however it says the government has actually committed to a “twin track” technique that will consist of the production of both ranges.
Comparison of cost estimates across different innovation types at main fuel rates commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
The CCC has actually formerly stated that the federal government must “set out [a] vision for contributions of hydrogen production from different routes to 2035” in its hydrogen strategy.
There was substantial pushback on this conclusion, with other researchers– consisting of CCC head of carbon budget plans, David Joffe– pointing out that it relied on very high methane leak and a short-term procedure of global warming capacity that emphasised the effect of methane emissions over CO2.
This opposition came to a head when a current research study led to headings mentioning that blue hydrogen is “worse for the climate than coal”.
The CCC has actually alerted that policies should establish both green and blue choices, “rather than just whichever is least-cost”.
The chart below, from a document laying out hydrogen expenses launched alongside the primary method, reveals the expected declining cost of electrolytic hydrogen gradually (green lines). (This consists of hydrogen made using grid electricity, which is not technically green unless the grid is 100% renewable.).
For its part, the CCC has actually suggested a “blue hydrogen bridge” as a beneficial tool for achieving net-zero. It states enabling some blue hydrogen will decrease emissions much faster in the short-term by replacing more fossil fuels with hydrogen when there is insufficient green hydrogen offered..
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a given quantity, various greenhouse gases trap different amounts of heat in the atmosphere, an amount known as … Read More.
Green hydrogen is made utilizing electrolysers powered by sustainable electricity, while blue hydrogen is used natural gas, with the resulting emissions recorded and stored..
” If we wish to show, trial, begin to commercialise and after that roll out the usage of hydrogen in industry/air travel/freight or wherever, then we need enough hydrogen. We cant wait up until the supply side deliberations are total.”.
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 argument”. He states:.
It has likewise released an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which examines maximum acceptable levels of emissions for low-carbon hydrogen production and the method for determining these emissions.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a statement that the federal government need to “be alive to the danger of gas industry lobbying causing it to devote too heavily to blue hydrogen therefore keeping the country locked into fossil fuel-based technology”.
The CCC has actually formerly specified “suitable emissions reductions” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
Supporting a range of projects will provide the UK a “competitive benefit”, according to the government. Germany, by contrast, has said it will focus solely on green hydrogen.
As it stands, blue hydrogen made utilizing steam methane reformation (SMR) is the most affordable low-carbon hydrogen readily available, according to federal government analysis consisted of in the technique. (For more on the relative expenses of different hydrogen ranges, see this Carbon Brief explainer.).
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, rather than “blue” or “green”, the UK would “think about carbon strength as the primary consider market advancement”.
At the heart of numerous discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The plan notes that, in some cases, hydrogen made utilizing electrolysers “could end up being cost-competitive with CCUS [carbon storage, utilisation and capture] -made it possible for methane reformation as early as 2025”..
The figure below from the assessment, based on this analysis, reveals the impact of setting a threshold of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production techniques above the red line, consisting of some for producing blue hydrogen, would be excluded.
Brief (hopefully) showing on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
CO2 equivalent: Greenhouse gases can be expressed in regards to co2 equivalent, or CO2eq. For a provided quantity, different greenhouse gases trap various quantities of heat in the environment, a quantity known as the global warming capacity. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not just co2.
The federal government has actually launched a consultation on low-carbon hydrogen standards to accompany the technique, with a promise to “settle design aspects” of such requirements by early 2022.
The former is basically zero-carbon, but the latter can still result in emissions due to methane leakages from gas facilities and the fact that carbon capture and storage (CCS) does not capture 100% of emissions..
The document does not do that and rather states it will supply “more information on our production strategy and twin track approach by early 2022”.
Many researchers and environmental groups are sceptical about blue hydrogen provided its associated emissions.
How will hydrogen be used in different sectors of the economy?
It includes plans for hydrogen heating trials and assessment on “hydrogen-ready” boilers by 2026.
Reacting to the report, energy scientists pointed to the “small” volumes of hydrogen anticipated to be produced in the near future and urged the federal government to select its priorities thoroughly.
The new technique is clear that market will be a “lead alternative” for early hydrogen use, beginning in the mid-2020s. It likewise states that it will “most likely” be important for decarbonising transport– particularly heavy products vehicles, shipping and air travel– and stabilizing a more renewables-heavy grid.
The committee emphasises that hydrogen usage must be limited to “areas less fit to electrification, particularly delivering and parts of market” and supplying flexibility to the power system.
Michael Liebrich of Liebreich Associates has actually organised making use of low-carbon hydrogen into a “ladder”, with current applications– such as the chemicals industry– offered leading concern.
Low-carbon hydrogen can be utilized to do whatever from sustaining cars and trucks to heating homes, the truth is that it will likely be limited by the volume that can probably be produced.
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 third of the size of the existing power sector.
Nevertheless, the strategy likewise consists of the option of utilizing hydrogen in sectors that might be much better served by electrification, particularly domestic heating, where hydrogen needs to compete with electrical heat pumps..
Juliet Phillips, senior policy consultant and UK hydrogen professional at thinktank E3G informs Carbon Brief the strategy had actually “exposed” the door for usages that “dont include the most value for the climate or economy”. She includes:.
The government is more positive about the usage of hydrogen in domestic heating. Its analysis suggests that up to 45TWh of low-carbon hydrogen might be put to this use by 2035, as the chart below indicates.
My lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! For anybody 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 use cases are similarly most likely to be successful. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021.
Call for proof on “hydrogen-ready” industrial devices by the end of 2021. Call for 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.
Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen technique.
Some applications, such as commercial heating, might be essentially difficult without a supply of hydrogen, and many professionals have actually argued that these hold true where it must be prioritised, at least in the short-term.
Government analysis, consisted of in the strategy, recommends potential hydrogen demand of up to 38 terawatt-hours (TWh) by 2030, not including blending it into the gas grid, and rising to 55-165TWh by 2035.
One significant exemption is hydrogen for fuel-cell traveler vehicles. This follows the governments concentrate on electrical cars, which many researchers view as more economical and effective technology.
Nevertheless, in the actual report, the government said that it anticipated “in general the need for low carbon hydrogen for heating by 2030 to be fairly low (<< 1TWh)".. " Stronger signals of intent might guide public and personal investments into those locations which add most worth. The federal government has not plainly laid out how to pick which sectors will benefit from the initial planned 5GW of production and has rather mostly left this to be determined through pilots and trials.". Nevertheless, the starting point for the variety-- 0TWh-- suggests there is significant uncertainty compared to other sectors, and even the highest price quote is just around a 10th of the energy currently used to heat UK homes. The CCC does not see substantial usage of hydrogen outside of these minimal cases by 2035, as the chart below shows. Dedications made in the brand-new technique consist of:. " As the strategy admits, there wont be substantial amounts of low-carbon hydrogen for some time. [For that reason] we require to use 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 statement. Coverage of the report and federal government promotional materials stressed that the governments plan would provide enough hydrogen to change gas in around 3m homes each year. 4) On page 62 the hydrogen method states that the federal government expects << 1 TWh of energy for heating to come from hydrogen by 2030. 1 TWh is 0.2%. Gniewomir Flis, a project supervisor at Agora Energiewende, informs Carbon Brief that-- in his view-- mixing "has no future". He discusses:. In order to produce a market for hydrogen, the government says it will examine mixing up to 20% hydrogen into the gas network by late 2022 and goal to make a last choice in late 2023. " I would suggest to opt for these no-regret options for hydrogen demand [in market] that are already readily available ... those ought to be the focus.". Much will depend upon the development of expediency studies in the coming years, and the governments approaching heat and structures strategy might also provide some clearness. How does the federal government strategy to support the hydrogen industry? These agreements are developed to conquer the cost space in between the favored innovation and nonrenewable fuel sources. Hydrogen producers would be given a payment that bridges this gap. The new hydrogen strategy verifies that this business model will be finalised in 2022, allowing the very first contracts to be assigned from the start of 2023. This is pending another consultation, which has actually been released alongside the main technique. Sharelines from this story. Hydrogen demand (pink area) and proportion of last energy usage 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 technique confesses, there wont be substantial amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen strategy specifies that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. " This will provide us a much better understanding of the mix of production technologies, how we will fulfill a ramp-up in demand, and the function that new innovations might play in achieving the levels of production essential to meet our future [sixth carbon spending plan] and net-zero dedications.". As it stands, low-carbon hydrogen remains costly compared to nonrenewable fuel source alternatives, there is unpredictability about the level of future need and high dangers for business aiming to enter the sector. According to the governments press release, its favored model is "constructed on a comparable premise to the overseas wind agreements for distinction (CfDs)", which considerably cut expenses of brand-new overseas wind farms. Much of the resulting press protection of the hydrogen method, from the Financial Times to the Daily Telegraph, concentrated on the prepare for a hydrogen industry "subsidised by taxpayers", as the money would originate from either higher costs or public funds. Anne-Marie Trevelyan-- minister for energy, tidy growth and environment change at BEIS-- told the Times that the cost to supply long-lasting security to the market would be "very small" for specific families. Now that its method has actually been released, the federal government says it will collect evidence from consultations on its low-carbon hydrogen requirement, net-zero hydrogen fund and the company design:. The 10-point plan consisted of a pledge to establish a hydrogen business design to motivate private financial investment and an income system to offer financing for the organization model.