In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
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The UKs brand-new, long-awaited hydrogen strategy offers more detail on how the federal government will support the development of a domestic low-carbon hydrogen sector, which today is virtually non-existent.
Professionals have actually alerted that, with hydrogen in brief supply in the coming years, the UK should prioritise it in “hard-to-electrify” sectors such as heavy market as capability expands.
Hydrogen will be “crucial” for attaining the UKs net-zero target and might utilize up to a 3rd of the countrys energy by 2050, according to the federal government.
In this article, Carbon Brief highlights crucial points from the 121-page strategy and examines some of the main talking points around the UKs hydrogen strategies.
Why does the UK require a hydrogen strategy?
Today we have published the UKs very first Hydrogen Strategy! This is our plan to: kick-start an entire industry unleash the marketplace 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.
There were likewise over 100 referrals to hydrogen throughout the governments energy white paper, showing its potential use in many sectors. It likewise features in the industrial and transportation decarbonisation methods released previously this year.
A recent All Party Parliamentary Group report on the role of hydrogen in powering industry included a list of needs, specifying that the government should “broaden beyond its existing dedications of 5GW production in the forthcoming hydrogen technique”. This call has actually been echoed by some industry groups.
The strategy does not increase this target, although it keeps in mind that the federal government is “aware of a possible pipeline of over 15GW of tasks”.
Critics also characterise hydrogen– the majority of which is currently made from natural gas– as a way for fossil fuel business to maintain the status quo. (For all the advantages and downsides of hydrogen, see Carbon Briefs in-depth explainer.).
The file consists of an expedition of how the UK will broaden production and produce a market for hydrogen based upon domestic supply chains. This contrasts with Germany, which has been wanting to import hydrogen from abroad.
The strategy likewise required a ₤ 240m net-zero hydrogen fund, the development of a hydrogen area warmed with the gas by 2023, and increasing hydrogen mixing into gas networks to 20% to minimize reliance on gas.
However, as the chart below programs, if the governments strategies come to fulfillment it could then expand considerably– using up in between 20-35% of the nations overall energy supply by 2050. This will require a major expansion of facilities and skills in the UK.
In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the very best methods of decarbonisation.
Its versatility implies it can be used to tackle emissions in “hard-to-abate” sectors, such as heavy market, but it currently struggles with high rates and low performance..
Prior to the new strategy, the prime ministers 10-point strategy in November 2020 included plans to produce 5 gigawatts (GW) of annual low-carbon hydrogen production in the UK by 2030. Currently, this capacity stands at practically absolutely no.
Hydrogen is widely seen as a crucial part in strategies to accomplish net-zero emissions and has actually been the subject of significant buzz, with many nations prioritising it in their post-Covid green healing plans.
Hydrogen growth for the next decade is anticipated to start gradually, with a government aspiration to “see 1GW production capacity by 2025” set out in the method.
Companies such as Equinor are continuing with hydrogen developments in the UK, however market figures have warned that the UK dangers being left behind. Other European nations have actually promised billions to support low-carbon hydrogen expansion.
In its brand-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 states it wants the nation to be a “worldwide leader on hydrogen” by 2030.
Hydrogen demand (pink location) and percentage of final energy intake in 2050 (%). The central variety is based on illustrative net-zero constant scenarios in the 6th carbon budget plan effect assessment and the full variety is based on the whole range from hydrogen method analytical annex. Source: UK hydrogen method.
As with most of the governments net-zero method documents so far, the hydrogen plan has actually been postponed by months, resulting in uncertainty around the future of this fledgling industry.
The Climate Change Committee (CCC) has kept in mind that, in order to hit the UKs carbon budgets and achieve net-zero emissions, decisions in locations such as decarbonising heating and vehicles require to be made in the 2020s to permit time for facilities and lorry stock changes.
What range of low-carbon hydrogen will be prioritised?
As it stands, blue hydrogen made utilizing steam methane reformation (SMR) is the cheapest low-carbon hydrogen readily available, according to government analysis included in the method. (For more on the relative expenses of various hydrogen ranges, see this Carbon Brief explainer.).
The plan notes that, sometimes, hydrogen made using electrolysers “might end up being cost-competitive with CCUS [carbon storage, utilisation and capture] -enabled methane reformation as early as 2025”..
This opposition capped when a recent study resulted in headlines mentioning that blue hydrogen is “even worse for the environment than coal”.
Green hydrogen is made utilizing electrolysers powered by sustainable electrical power, while blue hydrogen is used natural gas, with the resulting emissions caught and saved..
Supporting a range of tasks will offer the UK a “competitive benefit”, according to the government. Germany, by contrast, has said it will focus exclusively on green hydrogen.
It has also 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 methodology for computing these emissions.
The new technique mostly prevents utilizing this colour-coding system, however it says the government has committed to a “twin track” technique that will consist of the production of both varieties.
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 says:.
The technique mentions that the proportion of hydrogen supplied by specific technologies “depends on a variety of assumptions, which can just be checked through the marketplaces reaction to the policies set out in this method and genuine, at-scale release of hydrogen”..
The chart below, from a document laying out hydrogen expenses released alongside the main technique, reveals the anticipated declining cost of electrolytic hydrogen with time (green lines). (This consists of hydrogen made using grid electricity, which is not technically green unless the grid is 100% renewable.).
Glossary.
CO2 equivalent: Greenhouse gases can be expressed in terms of carbon dioxide equivalent, or CO2eq. For a given quantity, different greenhouse gases trap various quantities of heat in the atmosphere, an amount referred to as the worldwide warming potential. Co2 equivalent is a way of comparing emissions from all greenhouse gases, not just carbon dioxide.
The CCC has actually cautioned that policies must establish both blue and green alternatives, “instead of just whichever is least-cost”.
The document does not do that and instead says it will supply “more information on our production strategy and twin track approach by early 2022”.
There was substantial pushback on this conclusion, with other scientists– consisting of CCC head of carbon budget plans, David Joffe– pointing out that it relied on extremely high methane leak and a short-term measure of worldwide warming potential that emphasised the impact of methane emissions over CO2.
Contrast of cost estimates throughout different technology types at main fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.
At the heart of numerous conversations about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The former is essentially zero-carbon, however the latter can still result in emissions due to methane leaks from gas infrastructure and the reality that carbon capture and storage (CCS) does not record 100% of emissions..
Close.
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, an amount called … Read More.
The government has launched a consultation on low-carbon hydrogen standards to accompany the method, with a promise to “finalise style aspects” of such standards by early 2022.
Environmental groups and many researchers are sceptical about blue hydrogen provided its associated emissions.
The CCC has previously specified that the government should “set out [a] vision for contributions of hydrogen production from various routes to 2035” in its hydrogen technique.
In the example chosen for the consultation, natural gas paths where CO2 capture rates are listed below around 85% were excluded..
The figure listed below from the consultation, based upon this analysis, shows the impact of setting a limit of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production methods above the red line, including some for producing blue hydrogen, would be left out.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a statement that the government need to “live to the threat of gas industry lobbying causing it to commit too greatly to blue hydrogen therefore keeping the country locked into fossil fuel-based technology”.
The CCC has previously defined “ideal emissions reductions” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas savings”.
” If we want to show, trial, start to commercialise and after that roll out the usage of hydrogen in industry/air travel/freight or any place, then we require enough hydrogen. We cant wait till the supply side deliberations are complete.”.
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 “consider carbon intensity as the main aspect in market development”.
For its part, the CCC has recommended a “blue hydrogen bridge” as a helpful tool for accomplishing net-zero. It states permitting some blue hydrogen will decrease emissions much faster in the short-term by replacing more nonrenewable fuel sources with hydrogen when there is not enough green hydrogen offered..
Short (ideally) showing on this blue hydrogen thing. And then cherry-picked a climate metric to make it look as bad as possible.
How will hydrogen be utilized in different sectors of the economy?
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 presently utilized to heat UK homes.
This is in line with the CCCs recommendation for its net-zero path, which sees low-carbon hydrogen scaling approximately 90TWh by 2035– around a third of the size of the present power sector.
Nevertheless, the method also includes the choice of using hydrogen in sectors that might be better served by electrification, especially domestic heating, where hydrogen needs to take on electrical heat pumps..
Although low-carbon hydrogen can be utilized to do whatever from fuelling automobiles to heating houses, the truth is that it will likely be limited by the volume that can feasibly be produced.
Require evidence on “hydrogen-ready” commercial devices by the end of 2021. Require evidence 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 competitors in 2021.
Michael Liebrich of Liebreich Associates has arranged making use of low-carbon hydrogen into a “ladder”, with current applications– such as the chemicals industry– given leading priority.
Nevertheless, in the actual report, the federal government stated that it anticipated “overall the demand for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. The new method is clear that market will be a "lead alternative" for early hydrogen use, beginning in the mid-2020s. It likewise says that it will "likely" be essential for decarbonising transportation-- especially heavy products vehicles, shipping and aviation-- and stabilizing a more renewables-heavy grid. The CCC does not see comprehensive usage of hydrogen beyond these limited cases by 2035, as the chart listed below programs. Some applications, such as industrial heating, may be virtually difficult without a supply of hydrogen, and many specialists have argued that these hold true where it should be prioritised, at least in the short term. One notable exemption is hydrogen for fuel-cell guest cars. This is constant with the governments focus on electrical vehicles, which many scientists deem more economical and effective innovation. My lovelies, I simply 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 tidy hydrogen into some sort of merit order, because not all use cases are equally likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. " As the technique confesses, there wont be considerable amounts of low-carbon hydrogen for some time. Juliet Phillips, senior policy consultant and UK hydrogen professional at thinktank E3G informs Carbon Brief the strategy had actually "left open" the door for usages that "do not add the most worth for the environment or economy". She adds:. It contains prepare for hydrogen heating trials and assessment on "hydrogen-ready" boilers by 2026. Responding to the report, energy researchers indicated the "little" volumes of hydrogen expected to be produced in the near future and urged the government to select its top priorities thoroughly. " Stronger signals of intent could steer personal and public investments into those areas which add most value. The government has actually not plainly laid out how to decide upon which sectors will gain from the initial scheduled 5GW of production and has rather mainly left this to be figured out through pilots and trials.". Federal government analysis, consisted of in the strategy, recommends possible hydrogen need of as much as 38 terawatt-hours (TWh) by 2030, not consisting of blending it into the gas grid, and rising to 55-165TWh by 2035. Protection of the report and government marketing products stressed that the federal governments plan would supply sufficient hydrogen to replace gas in around 3m houses each year. Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen strategy. Commitments made in the new technique include:. The federal government is more optimistic about using hydrogen in domestic heating. Its analysis recommends that up to 45TWh of low-carbon hydrogen could be put to this use by 2035, as the chart listed below indicates. The committee stresses that hydrogen use should be limited to "areas less fit to electrification, particularly shipping and parts of industry" and supplying flexibility to the power system. 4) On page 62 the hydrogen technique mentions that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. Existing energy need in the UK for space 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. In order to produce a market for hydrogen, the federal government says it will take a look at blending up to 20% hydrogen into the gas network by late 2022 and goal to make a last choice in late 2023. " I would recommend to go with these no-regret options for hydrogen demand [in market] that are currently offered ... those should be the focus.". Much will depend upon the progress of feasibility research studies in the coming years, and the governments approaching heat and structures method might likewise supply some clarity. Gniewomir Flis, a job manager at Agora Energiewende, tells Carbon Brief that-- in his view-- mixing "has no future". He discusses:. How does the federal government plan to support the hydrogen market? As it stands, low-carbon hydrogen remains costly compared to fossil fuel options, there is uncertainty about the level of future need and high threats for companies intending to enter the sector. The brand-new hydrogen strategy validates that this organization model will be finalised in 2022, allowing the first contracts to be assigned from the start of 2023. This is pending another assessment, which has been released alongside the primary method. Hydrogen need (pink location) and percentage of last energy consumption in 2050 (%). My lovelies, I simply 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 strategy admits, there wont be substantial quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen technique specifies that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. " This will offer us a much better understanding of the mix of production technologies, how we will meet a ramp-up in demand, and the function that brand-new innovations could play in achieving the levels of production essential to fulfill our future [6th carbon spending plan] and net-zero dedications.". These contracts are developed to conquer the cost space in between the favored innovation and fossil fuels. Hydrogen manufacturers would be offered a payment that bridges this gap. Much of the resulting press coverage of the hydrogen method, from the Financial Times to the Daily Telegraph, focused on the prepare for a hydrogen industry "subsidised by taxpayers", as the cash would come from either higher costs or public funds. According to the governments news release, its preferred model is "built on a comparable premise to the overseas wind agreements for distinction (CfDs)", which significantly cut costs of brand-new offshore wind farms. Now that its technique has been released, the federal government states it will gather proof from consultations on its low-carbon hydrogen requirement, net-zero hydrogen fund and the service model:. Nevertheless, Anne-Marie Trevelyan-- minister for energy, tidy growth and climate change at BEIS-- told the Times that the expense to offer long-lasting security to the market would be "extremely small" for private homes. The 10-point strategy included a promise to establish a hydrogen organization model to motivate private financial investment and an earnings system to offer financing for the business model. Sharelines from this story.