Professionals have actually alerted 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.
Firm decisions around the degree of hydrogen usage in domestic heating and how to guarantee it is produced in a low-carbon method have actually been delayed or put out to assessment for the time being.
In this article, Carbon Brief highlights key points from the 121-page strategy and takes a look at a few of the main talking points around the UKs hydrogen plans.
Hydrogen will be “critical” for accomplishing the UKs net-zero target and could fulfill up to a third of the nations energy requirements by 2050, according to the government.
The UKs brand-new, long-awaited hydrogen technique provides more information on how the government will support the development of a domestic low-carbon hydrogen sector, which today is essentially non-existent.
Why does the UK need a hydrogen technique?
The strategy likewise called for 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 reduce reliance on natural gas.
Today we have actually released the UKs first Hydrogen Strategy! This is our strategy to: kick-start a whole market release the marketplace to cut expenses increase domestic production unlock ₤ 4bn of personal capital support 9k jobs #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
Nevertheless, just like the majority of the governments net-zero strategy documents so far, the hydrogen plan has actually been delayed by months, leading to uncertainty around the future of this new industry.
Prior to the new technique, the prime ministers 10-point strategy in November 2020 consisted of strategies to produce 5 gigawatts (GW) of annual low-carbon hydrogen production capacity in the UK by 2030. Presently, this capacity stands at virtually absolutely no.
In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the best methods of decarbonisation.
As the chart below shows, if the governments strategies come to fruition it might then broaden significantly– making up between 20-35% of the countrys overall energy supply by 2050. This will require a major expansion of infrastructure and abilities in the UK.
The file consists of an expedition of how the UK will broaden production and create a market for hydrogen based upon domestic supply chains. This contrasts with Germany, which has been wanting to import hydrogen from abroad.
The Climate Change Committee (CCC) has actually noted that, in order to hit the UKs carbon budgets and accomplish net-zero emissions, decisions in areas such as decarbonising heating and lorries need to be made in the 2020s to permit time for facilities and lorry stock modifications.
Its flexibility means it can be utilized to take on emissions in “hard-to-abate” sectors, such as heavy market, but it presently struggles with high costs and low performance..
The strategy does not increase this target, although it keeps in mind that the government is “knowledgeable about a potential pipeline of over 15GW of projects”.
There were also over 100 references to hydrogen throughout the federal governments energy white paper, showing its prospective usage in many sectors. It also features in the industrial and transport decarbonisation methods released earlier this year.
Hydrogen is widely viewed as a crucial part in plans to achieve net-zero emissions and has actually been the subject of considerable hype, with many countries prioritising it in their post-Covid green recovery strategies.
The level of hydrogen usage in 2050 imagined by the strategy is rather higher than set out by the CCC in its most recent guidance, but covers a similar range to other studies.
Critics likewise characterise hydrogen– the majority of which is currently made from gas– as a method for fossil fuel business to keep the status quo. (For all the advantages and downsides of hydrogen, see Carbon Briefs thorough explainer.).
Companies such as Equinor are continuing with hydrogen advancements in the UK, however market figures have actually alerted that the UK risks being left. Other European countries have pledged billions to support low-carbon hydrogen expansion.
Hydrogen need (pink area) and proportion of last energy usage in 2050 (%). The main range is based on illustrative net-zero constant scenarios in the 6th carbon spending plan impact evaluation and the full variety is based on the whole variety from hydrogen strategy analytical annex. Source: UK hydrogen strategy.
A recent All Party Parliamentary Group report on the role of hydrogen in powering industry included a list of demands, specifying that the government needs to “expand beyond its existing commitments of 5GW production in the upcoming hydrogen method”. This call has been echoed by some market groups.
Hydrogen development for the next decade is anticipated to begin gradually, with a federal government aspiration to “see 1GW production capacity by 2025” set out in the method.
In its new strategy, the UK government makes it clear that it sees low-carbon hydrogen as an essential part of its net-zero plan, and states it desires the country to be a “international leader on hydrogen” by 2030.
What variety of low-carbon hydrogen will be prioritised?
CO2 equivalent: Greenhouse gases can be expressed in regards to co2 equivalent, or CO2eq. For a given quantity, different greenhouse gases trap different amounts of heat in the environment, an amount referred to as the international warming capacity. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not simply carbon dioxide.
” If we want to demonstrate, trial, start to commercialise and after that roll out the use of hydrogen in industry/air travel/freight or anywhere, then we require enough hydrogen. We cant wait up until the supply side considerations are complete.”.
It has actually also launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which examines maximum appropriate levels of emissions for low-carbon hydrogen production and the methodology for computing these emissions.
Many scientists and ecological groups are sceptical about blue hydrogen provided its associated emissions.
Green hydrogen is made utilizing electrolysers powered by eco-friendly electrical energy, while blue hydrogen is used natural gas, with the resulting emissions caught and saved..
The federal government has actually released an assessment on low-carbon hydrogen requirements to accompany the technique, with a pledge to “finalise design components” of such requirements by early 2022.
For its part, the CCC has actually suggested a “blue hydrogen bridge” as an useful tool for attaining net-zero. It says enabling some blue hydrogen will lower emissions much faster in the short-term by changing more nonrenewable fuel sources with hydrogen when there is not adequate green hydrogen offered..
As it stands, blue hydrogen used steam methane reformation (SMR) is the most inexpensive low-carbon hydrogen readily available, according to government analysis included in the strategy. (For more on the relative expenses of various hydrogen varieties, see this Carbon Brief explainer.).
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 blue vs green hydrogen argument”. He says:.
This opposition came to a head when a current study resulted in headings stating that blue hydrogen is “worse for the environment than coal”.
CO2 equivalent: Greenhouse gases can be revealed in terms of co2 equivalent, or CO2eq. For an offered amount, different greenhouse gases trap different amounts of heat in the atmosphere, a quantity referred to as … Read More.
The method states that the percentage of hydrogen provided by particular technologies “depends on a variety of assumptions, which can just be tested through the markets response to the policies set out in this method and genuine, at-scale implementation of hydrogen”..
The figure listed 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 approaches above the red line, including some for producing blue hydrogen, would be omitted.
The previous is essentially zero-carbon, but the latter can still result in emissions due to methane leaks from gas facilities and the reality that carbon capture and storage (CCS) does not catch 100% of emissions..
Quick (hopefully) reflecting on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
Jess Ralston, an analyst at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a statement that the federal 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 CCC has previously specified “ideal emissions reductions” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
In the example selected for the assessment, natural gas routes where CO2 capture rates are below around 85% were omitted..
The strategy notes that, in many cases, hydrogen made utilizing electrolysers “might end up being cost-competitive with CCUS [carbon storage, utilisation and capture] -allowed methane reformation as early as 2025”..
Nevertheless, there was significant pushback on this conclusion, with other researchers– including CCC head of carbon budget plans, David Joffe– pointing out that it depended on very high methane leakage and a short-term step of worldwide warming potential that emphasised the effect of methane emissions over CO2.
The CCC has actually previously stated that the federal government needs to “set out [a] vision for contributions of hydrogen production from different paths to 2035” in its hydrogen method.
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 intensity as the primary consider market advancement”.
At the heart of many conversations about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The document does refrain from doing that and instead states it will offer “further detail on our production strategy and twin track approach by early 2022”.
The CCC has alerted that policies need to establish both green and blue alternatives, “instead of just whichever is least-cost”.
Contrast of price estimates across various innovation types at central fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
The new strategy mostly prevents utilizing this colour-coding system, but it states the government has actually devoted to a “twin track” technique that will include the production of both ranges.
The chart below, from a document outlining hydrogen costs launched together with the main technique, reveals the anticipated decreasing expense of electrolytic hydrogen gradually (green lines). (This includes hydrogen made using grid electrical energy, which is not technically green unless the grid is 100% sustainable.).
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 solely on green hydrogen.
How will hydrogen be utilized in various sectors of the economy?
This is in line with the CCCs recommendation for its net-zero pathway, which sees low-carbon hydrogen scaling up to 90TWh by 2035– around a third of the size of the present power sector.
The method also consists of the choice of using hydrogen in sectors that might be better served by electrification, especially domestic heating, where hydrogen has to complete with electric heat pumps..
Nevertheless, in the real report, the federal government said that it expected “overall the demand for low carbon hydrogen for heating by 2030 to be fairly low (<< 1TWh)".. Government analysis, included in the strategy, suggests possible hydrogen need of approximately 38 terawatt-hours (TWh) by 2030, not including blending it into the gas grid, and increasing to 55-165TWh by 2035. The starting point for the range-- 0TWh-- recommends there is substantial uncertainty compared to other sectors, and even the highest price quote is only around a 10th of the energy currently utilized to heat UK houses. Some applications, such as industrial heating, might be practically impossible without a supply of hydrogen, and numerous specialists have argued that these hold true where it must be prioritised, a minimum of in the brief term. Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen method. " As the strategy admits, there wont be considerable quantities of low-carbon hydrogen for some time. Reacting to the report, energy researchers indicated the "little" volumes of hydrogen anticipated to be produced in the near future and prompted the federal government to choose its priorities thoroughly. One notable exemption is hydrogen for fuel-cell passenger vehicles. This follows the federal governments concentrate on electrical cars and trucks, which numerous researchers consider as more cost-efficient and effective innovation. The federal government is more positive about using hydrogen in domestic heating. Its analysis suggests that up to 45TWh of low-carbon hydrogen could be put to this use by 2035, as the chart below indicates. Juliet Phillips, senior policy advisor and UK hydrogen professional at thinktank E3G tells Carbon Brief the technique had actually "left open" the door for uses that "dont add the most worth for the environment or economy". She adds:. Dedications made in the brand-new technique consist of:. Although low-carbon hydrogen can be used to do whatever from sustaining automobiles to heating homes, the truth is that it will likely be limited by the volume that can feasibly be produced. Michael Liebrich of Liebreich Associates has actually arranged using low-carbon hydrogen into a "ladder", with present applications-- such as the chemicals market-- provided top priority. " Stronger signals of intent could guide private and public financial investments into those locations which include most value. The government has not clearly set out how to choose which sectors will benefit from the preliminary planned 5GW of production and has rather largely left this to be determined through pilots and trials.". My lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! For anyone brand-new to all this, the ladder is my effort to put use cases for clean hydrogen into some sort of benefit order, since not all usage cases are similarly likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. Call for evidence on "hydrogen-ready" industrial equipment 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 competitors in 2021. The brand-new method is clear that industry will be a "lead option" for early hydrogen usage, starting in the mid-2020s. It also states that it will "likely" be essential for decarbonising transport-- particularly heavy goods vehicles, shipping and air travel-- and balancing a more renewables-heavy grid. Coverage of the report and government promotional products stressed that the federal governments strategy would offer enough hydrogen to replace gas in around 3m homes each year. The committee stresses that hydrogen use must be restricted to "locations less suited to electrification, particularly shipping and parts of market" and offering flexibility to the power system. The CCC does not see extensive use of hydrogen beyond these restricted cases by 2035, as the chart below shows. It contains plans for hydrogen heating trials and consultation on "hydrogen-ready" boilers by 2026. 4) On page 62 the hydrogen strategy states that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. 1 TWh is 0.2%. " I would recommend to choose these no-regret alternatives for hydrogen demand [in industry] that are currently readily available ... those should be the focus.". Much will depend upon the progress of feasibility research studies in the coming years, and the federal governments upcoming heat and structures technique might also provide some clearness. Gniewomir Flis, a task supervisor at Agora Energiewende, tells Carbon Brief that-- in his view-- mixing "has no future". He describes:. Lastly, in order to create a market for hydrogen, the federal government states it will examine blending approximately 20% hydrogen into the gas network by late 2022 and goal to make a last decision in late 2023. How does the government strategy to support the hydrogen industry? Much of the resulting press coverage of the hydrogen technique, from the Financial Times to the Daily Telegraph, concentrated on the plan for a hydrogen market "subsidised by taxpayers", as the cash would come from either higher expenses or public funds. Hydrogen demand (pink location) and percentage of final energy intake 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 technique admits, there will not be substantial quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen strategy mentions that the federal government expects << 1 TWh of energy for heating to come from hydrogen by 2030. As it stands, low-carbon hydrogen stays pricey compared to fossil fuel alternatives, there is uncertainty about the level of future need and high threats for companies aiming to go into the sector. The new hydrogen strategy validates that this organization model will be settled in 2022, allowing the first agreements to be designated from the start of 2023. This is pending another consultation, which has actually been released together with the main technique. Now that its technique has actually been published, the federal government states it will gather evidence from consultations on its low-carbon hydrogen requirement, net-zero hydrogen fund and business model:. Sharelines from this story. According to the federal governments news release, its preferred design is "constructed on a similar property to the overseas wind agreements for difference (CfDs)", which substantially cut costs of brand-new offshore wind farms. However, Anne-Marie Trevelyan-- minister for energy, clean growth and environment modification at BEIS-- told the Times that the cost to provide long-term security to the market would be "extremely small" for individual households. The 10-point plan consisted of a promise to develop a hydrogen business model to encourage personal investment and a profits mechanism to offer financing for business design. These contracts are designed to overcome the cost gap in between the favored technology and fossil fuels. Hydrogen producers would be provided a payment that bridges this gap. " This will give us a much better understanding of the mix of production innovations, how we will fulfill a ramp-up in demand, and the role that new innovations might play in accomplishing the levels of production required to satisfy our future [6th carbon spending plan] and net-zero dedications.".