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

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

Hydrogen will be “important” for accomplishing the UKs net-zero target and could consume to a third of the countrys energy by 2050, according to the government.

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

Experts have 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.

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

Why does the UK require a hydrogen technique?

As the chart below programs, if the governments strategies come to fulfillment it could then expand substantially– taking up in between 20-35% of the nations total energy supply by 2050. This will need a significant expansion of facilities and skills in the UK.

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

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

As with many of the governments net-zero method files so far, the hydrogen strategy has been postponed by months, resulting in unpredictability around the future of this fledgling market.

The document includes 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.

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

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

Its adaptability suggests it can be used to deal with emissions in “hard-to-abate” sectors, such as heavy market, however it currently struggles with high prices and low performance..

In its brand-new technique, the UK federal government makes it clear that it sees low-carbon hydrogen as a key part of its net-zero plan, and states it wants the nation to be a “worldwide leader on hydrogen” by 2030.

Hydrogen development for the next years is anticipated to start gradually, with a federal government goal to “see 1GW production capability by 2025” laid out in the strategy.

The strategy does not increase this target, although it notes that the federal government is “familiar with a prospective pipeline of over 15GW of tasks”.

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

Hydrogen is commonly viewed as an essential component in strategies to achieve net-zero emissions and has actually been the subject of substantial buzz, with lots of nations prioritising it in their post-Covid green healing strategies.

Prior to the brand-new strategy, the prime ministers 10-point plan in November 2020 included strategies to produce 5 gigawatts (GW) of annual low-carbon hydrogen production in the UK by 2030. Presently, this capability stands at virtually no.

A current All Party Parliamentary Group report on the function of hydrogen in powering industry included 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 actually been echoed by some industry groups.

Hydrogen demand (pink location) and proportion of final energy intake in 2050 (%). The main range is based upon illustrative net-zero constant scenarios in the 6th carbon budget plan impact evaluation and the full variety is based on the entire variety from hydrogen technique analytical annex. Source: UK hydrogen strategy.

Critics also characterise hydrogen– the majority of which is currently made from natural gas– as a method for fossil fuel companies to maintain the status quo. (For all the advantages and drawbacks of hydrogen, see Carbon Briefs thorough explainer.).

There were likewise over 100 references to hydrogen throughout the governments energy white paper, reflecting its potential use in numerous sectors. It also features in the industrial and transport decarbonisation methods released earlier this year.

What range of low-carbon hydrogen will be prioritised?

The previous is basically zero-carbon, however the latter can still result in emissions due to methane leakages from natural gas facilities and the reality that carbon capture and storage (CCS) does not record 100% of emissions..

In the example selected for the consultation, gas routes where CO2 capture rates are below around 85% were left out..

The figure below from the assessment, based upon this analysis, reveals 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, consisting of some for producing blue hydrogen, would be omitted.

Environmental groups and numerous researchers are sceptical about blue hydrogen given its associated emissions.

It has 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 method for determining these emissions.

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 danger of gas market lobbying causing it to dedicate too greatly to blue hydrogen and so keeping the nation locked into fossil fuel-based innovation”.

As it stands, blue hydrogen used steam methane reformation (SMR) is the least expensive low-carbon hydrogen available, according to government analysis consisted of in the technique. (For more on the relative expenses of various hydrogen ranges, see this Carbon Brief explainer.).

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

CO2 equivalent: Greenhouse gases can be revealed in regards to co2 equivalent, or CO2eq. For a given amount, various greenhouse gases trap different amounts of heat in the environment, an amount called the international warming capacity. Co2 equivalent is a way of comparing emissions from all greenhouse gases, not simply carbon dioxide.

The file does not do that and rather says it will provide “further information on our production strategy and twin track approach by early 2022”.

The CCC has previously defined “suitable 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 “think about carbon intensity as the primary consider market development”.

Glossary.

Contrast of cost estimates across various technology types at main fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.

The brand-new strategy largely prevents using this colour-coding system, however it states the government has actually devoted to a “twin track” technique that will include the production of both varieties.

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

However, there was considerable pushback on this conclusion, with other researchers– including CCC head of carbon budget plans, David Joffe– explaining that it relied on very high methane leakage and a short-term procedure of international warming capacity that stressed the impact of methane emissions over CO2.

The strategy mentions that the percentage of hydrogen provided by specific innovations “depends upon a series of assumptions, which can only be tested through the markets response to the policies set out in this method and real, at-scale deployment of hydrogen”..

” If we wish to demonstrate, trial, begin to commercialise and then present using hydrogen in industry/air travel/freight or wherever, then we require enough hydrogen. We cant wait up until the supply side considerations are total.”.

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

The chart below, from a file outlining hydrogen expenses launched along with the main method, reveals the expected declining cost of electrolytic hydrogen over time (green lines). (This consists of hydrogen made utilizing grid electrical power, which is not technically green unless the grid is 100% renewable.).

This opposition capped when a current research study resulted in headlines specifying that blue hydrogen is “worse for the environment than coal”.

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

Short (ideally) reflecting on this blue hydrogen thing. And then cherry-picked a climate metric to make it look as bad as possible.

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

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

The CCC has warned that policies should establish both blue and green alternatives, “instead of simply whichever is least-cost”.

For its part, the CCC has suggested a “blue hydrogen bridge” as a helpful tool for achieving net-zero. It states permitting some blue hydrogen will decrease emissions faster in the short-term by changing more nonrenewable fuel sources with hydrogen when there is not enough green hydrogen available..

Close.
CO2 equivalent: Greenhouse gases can be revealed in terms of co2 equivalent, or CO2eq. For a provided quantity, different greenhouse gases trap different quantities of heat in the environment, an amount understood as … Read More.

The plan notes that, in some cases, hydrogen made using electrolysers “could end up being cost-competitive with CCUS [carbon capture, utilisation and storage] -allowed methane reformation as early as 2025″..

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

” As the method admits, there wont be significant quantities of low-carbon hydrogen for a long time. [] 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 programs at the Regulatory Assistance Project, in a statement.

Some applications, such as commercial heating, may be virtually impossible without a supply of hydrogen, and lots of specialists have actually argued that these are the cases where it should be prioritised, a minimum of in the short-term.

Reacting to the report, energy researchers pointed to the “little” volumes of hydrogen expected to be produced in the near future and urged the government to choose its concerns thoroughly.

Federal government analysis, included in the technique, recommends prospective hydrogen need of up to 38 terawatt-hours (TWh) by 2030, not consisting of mixing it into the gas grid, and increasing to 55-165TWh by 2035.

However, the method also includes the alternative of using hydrogen in sectors that might be better served by electrification, especially domestic heating, where hydrogen needs to take on electric heat pumps..

Although low-carbon hydrogen can be utilized to do whatever from sustaining cars and trucks to heating houses, the truth is that it will likely be restricted by the volume that can feasibly be produced.

It consists of prepare for hydrogen heating trials and consultation on “hydrogen-ready” boilers by 2026.

This is in line with the CCCs recommendation for its net-zero pathway, which sees low-carbon hydrogen scaling approximately 90TWh by 2035– around a 3rd of the size of the present power sector.

Require evidence on “hydrogen-ready” commercial devices by the end of 2021. Require 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.

The committee emphasises that hydrogen use ought to be limited to “areas less fit to electrification, especially delivering and parts of market” and providing 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– given leading concern.

Juliet Phillips, senior policy consultant and UK hydrogen expert at thinktank E3G tells Carbon Brief the technique had “exposed” the door for uses that “do not add the most value for the environment or economy”. She includes:.

Dedications made in the new method include:.

Coverage of the report and federal government marketing materials emphasised that the governments plan would offer adequate hydrogen to change natural gas in around 3m houses each year.

Nevertheless, in the actual report, the federal government said that it expected “in general 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 as much as 45TWh of low-carbon hydrogen could be put to this use by 2035, as the chart below indicates. One significant exclusion is hydrogen for fuel-cell automobile. This follows the governments focus on electric automobiles, which many scientists view as more economical and efficient technology. The CCC does not see substantial use of hydrogen outside of these limited cases by 2035, as the chart below programs. The new strategy is clear that market will be a "lead choice" for early hydrogen use, beginning in the mid-2020s. It likewise says that it will "likely" be necessary for decarbonising transportation-- particularly heavy items vehicles, shipping and air travel-- and balancing a more renewables-heavy grid. My lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! For anyone new to all this, the ladder is my attempt to put usage cases for clean hydrogen into some sort of benefit order, since not all usage cases are similarly most likely to be successful. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. " Stronger signals of intent could steer public and personal financial investments into those areas which add most value. The government has actually not plainly laid out how to pick which sectors will take advantage of the preliminary scheduled 5GW of production and has instead mostly left this to be figured out through pilots and trials.". Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen strategy. Nevertheless, the starting point for the range-- 0TWh-- suggests there is considerable uncertainty compared to other sectors, and even the highest quote is just around a 10th of the energy currently utilized to heat UK homes. 4) On page 62 the hydrogen technique mentions that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. Current energy demand in the UK for space and warm 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. Lastly, in order to develop a market for hydrogen, the federal government says it will analyze mixing as much as 20% hydrogen into the gas network by late 2022 and goal to make a decision in late 2023. " I would recommend to opt for these no-regret options for hydrogen need [in market] that are already available ... those must be the focus.". Gniewomir Flis, a project manager at Agora Energiewende, informs Carbon Brief that-- in his view-- mixing "has no future". He explains:. Much will depend upon the development of expediency studies in the coming years, and the federal governments approaching heat and structures strategy might also provide some clearness. How does the federal government plan to support the hydrogen market? Now that its strategy has actually been published, the government states it will gather proof from consultations on its low-carbon hydrogen standard, net-zero hydrogen fund and business design:. 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 substantially cut costs of brand-new offshore wind farms. The 10-point plan included a pledge to develop a hydrogen service design to motivate private financial investment and a revenue mechanism to provide financing for business design. As it stands, low-carbon hydrogen stays pricey compared to fossil fuel alternatives, there is unpredictability about the level of future need and high risks for companies intending to go into the sector. Much of the resulting press protection of the hydrogen method, from the Financial Times to the Daily Telegraph, focused on the prepare for a hydrogen market "subsidised by taxpayers", as the money would originate from either greater bills or public funds. " This will offer us a much better understanding of the mix of production innovations, how we will satisfy a ramp-up in demand, and the function that brand-new innovations could play in accomplishing the levels of production necessary to satisfy our future [sixth carbon spending plan] and net-zero commitments.". These contracts are developed to overcome the cost space in between the favored innovation and fossil fuels. Hydrogen producers would be given a payment that bridges this space. Sharelines from this story. Hydrogen demand (pink location) and proportion 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 market "within a year"." As the method admits, there wont be significant quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method states that the federal government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. Anne-Marie Trevelyan-- minister for energy, tidy development and climate change at BEIS-- told the Times that the cost to offer long-lasting security to the market would be "really small" for individual families. The new hydrogen technique confirms that this organization model will be finalised in 2022, making it possible for the first contracts to be allocated from the start of 2023. This is pending another assessment, which has been launched together with the primary technique.

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