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

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

Specialists have actually warned that, with hydrogen in short supply in the coming years, the UK needs to prioritise it in “hard-to-electrify” sectors such as heavy industry as capability expands.

On the other hand, firm choices around the extent of hydrogen usage in domestic heating and how to guarantee it is produced in a low-carbon way have been delayed or put out to assessment for the time being.

Hydrogen will be “vital” for attaining the UKs net-zero target and could fulfill up to a third of the nations energy requirements by 2050, according to the federal government.

In this short article, 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 method?

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 techniques launched previously this year.

Hydrogen is widely viewed as an important part in strategies to accomplish net-zero emissions and has been the topic of considerable buzz, with numerous countries prioritising it in their post-Covid green healing strategies.

As the chart below shows, if the federal governments plans come to fulfillment it might then broaden considerably– making up in between 20-35% of the countrys overall energy supply by 2050. This will need a significant growth of facilities and skills in the UK.

Critics likewise characterise hydrogen– the majority of which is currently made from natural gas– as a way for fossil fuel companies to maintain the status quo. (For all the benefits and drawbacks of hydrogen, see Carbon Briefs in-depth explainer.).

The Climate Change Committee (CCC) has noted that, in order to hit the UKs carbon budgets and attain net-zero emissions, choices in locations such as decarbonising heating and lorries need to be made in the 2020s to allow time for infrastructure and vehicle stock changes.

A recent All Party Parliamentary Group report on the role of hydrogen in powering industry included a list of demands, specifying that the government must “expand beyond its existing dedications of 5GW production in the upcoming hydrogen technique”. This call has actually been echoed by some industry groups.

Business 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 countries have actually promised billions to support low-carbon hydrogen growth.

The strategy also required a ₤ 240m net-zero hydrogen fund, the development of a hydrogen neighbourhood heated with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to minimize reliance on natural gas.

Hydrogen demand (pink location) and proportion of last energy consumption in 2050 (%). The central variety is based upon illustrative net-zero constant scenarios in the 6th carbon spending plan effect evaluation and the full variety is based on the entire range from hydrogen method analytical annex. Source: UK hydrogen strategy.

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

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

As with most of the governments net-zero technique documents so far, the hydrogen strategy has actually been delayed by months, resulting in uncertainty around the future of this fledgling market.

The file includes an expedition of how the UK will broaden production and develop a market for hydrogen based upon domestic supply chains. This contrasts with Germany, which has actually been seeking to import hydrogen from abroad.

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

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

The level of hydrogen usage in 2050 envisaged by the method is rather higher than set out by the CCC in its newest recommendations, however covers a similar range to other research studies.

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 jobs”.

Its adaptability means it can be used to tackle emissions in “hard-to-abate” sectors, such as heavy market, but it presently experiences high costs and low effectiveness..

Hydrogen growth for the next decade is expected to begin slowly, with a federal government aspiration to “see 1GW production capability by 2025” laid out in the method.

What variety of low-carbon hydrogen will be prioritised?

The former is essentially zero-carbon, but the latter can still lead to emissions due to methane leaks from gas facilities and the truth that carbon capture and storage (CCS) does not capture 100% of emissions..

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 strength as the main consider market advancement”.

Jess Ralston, an analyst at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a declaration that the federal government need to “live to the danger of gas market lobbying causing it to devote too greatly to blue hydrogen and so keeping the country locked into fossil fuel-based innovation”.

The file does not do that and instead states it will supply “more detail on our production technique and twin track technique by early 2022″.

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

In the example chosen for the assessment, natural gas paths where CO2 capture rates are below around 85% were omitted..

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

Supporting a variety of jobs will give the UK a “competitive advantage”, according to the government. Germany, by contrast, has said it will focus specifically on green hydrogen.

The technique mentions that the percentage of hydrogen provided by particular innovations “depends on a series of presumptions, which can just be tested through the markets reaction to the policies set out in this strategy and genuine, at-scale deployment of hydrogen”..

Green hydrogen is used electrolysers powered by renewable electrical energy, while blue hydrogen is used gas, with the resulting emissions recorded and saved..

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CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For an offered quantity, various greenhouse gases trap various amounts of heat in the environment, a quantity referred to as … Read More.

It has likewise released an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which analyzes maximum appropriate levels of emissions for low-carbon hydrogen production and the approach for calculating these emissions.

Comparison of rate quotes throughout various innovation types at central fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
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CO2 equivalent: Greenhouse gases can be expressed in terms of carbon dioxide equivalent, or CO2eq. For a provided amount, various greenhouse gases trap different amounts of heat in the atmosphere, an amount referred to as the international warming potential. Co2 equivalent is a method of comparing emissions from all greenhouse gases, not simply carbon dioxide.

Glossary.

The figure below from the consultation, based upon this analysis, shows 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 CCC has warned that policies must develop both blue and green options, “rather than simply whichever is least-cost”.

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

The CCC has formerly stated that the federal government ought to “set out [a] vision for contributions of hydrogen production from different paths to 2035” in its hydrogen strategy.

However, there was substantial pushback on this conclusion, with other researchers– consisting of CCC head of carbon spending plans, David Joffe– mentioning that it depended on extremely high methane leakage and a short-term measure of global warming capacity that emphasised the impact of methane emissions over CO2.

The brand-new technique mostly prevents utilizing this colour-coding system, but it states the federal government has committed to a “twin track” approach that will consist of the production of both ranges.

The CCC has previously specified “suitable emissions reductions” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas savings”.

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

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

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 green vs blue hydrogen dispute”. He says:.

The chart below, from a document laying out hydrogen expenses launched alongside the main strategy, reveals the anticipated declining expense of electrolytic hydrogen over time (green lines). (This includes hydrogen made utilizing grid electrical energy, which is not technically green unless the grid is 100% renewable.).

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

The plan notes that, in some cases, hydrogen used electrolysers “could become cost-competitive with CCUS [carbon utilisation, capture and storage] -allowed methane reformation as early as 2025”..

For its part, the CCC has actually advised a “blue hydrogen bridge” as an useful tool for attaining net-zero. It says allowing some blue hydrogen will lower emissions quicker in the short-term by replacing more nonrenewable fuel sources with hydrogen when there is insufficient green hydrogen offered..

Quick (ideally) reviewing this blue hydrogen thing. Basically, the papers computations potentially represent a case where blue H ₂ is done really badly & & without any reasonable guidelines. 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.

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

Although low-carbon hydrogen can be used to do everything from fuelling vehicles to heating houses, the truth is that it will likely be restricted by the volume that can feasibly be produced.

Michael Liebrich of Liebreich Associates has arranged the usage of low-carbon hydrogen into a “ladder”, with current applications– such as the chemicals market– provided top priority.

The starting point for the variety– 0TWh– recommends there is considerable unpredictability compared to other sectors, and even the highest quote is only around a 10th of the energy presently used to heat UK homes.

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 3rd of the size of the current power sector.

Coverage of the report and government promotional products stressed that the federal governments strategy would offer adequate hydrogen to replace natural gas in around 3m homes each year.

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

Dedications made in the brand-new technique consist of:.

The government is more positive about using 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 suggests.

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

” As the method admits, there wont be considerable amounts of low-carbon hydrogen for a long time. [] we need to utilize it where there are few alternatives 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.

The CCC does not see substantial use of hydrogen beyond these limited cases by 2035, as the chart listed below shows.

Some applications, such as commercial heating, may be essentially impossible without a supply of hydrogen, and numerous specialists have actually argued that these hold true where it ought to be prioritised, at least in the short-term.

Nevertheless, the technique also includes the option of utilizing hydrogen in sectors that may be much better served by electrification, especially domestic heating, where hydrogen needs to take on electrical heatpump..

Juliet Phillips, senior policy advisor and UK hydrogen expert at thinktank E3G tells Carbon Brief the strategy had actually “left open” the door for uses that “do not include the most worth for the climate or economy”. She adds:.

In the real report, the government said that it expected “in general the demand for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. One noteworthy exclusion is hydrogen for fuel-cell passenger cars. This is consistent with the governments concentrate on electric automobiles, which lots of scientists deem more efficient and affordable technology. Require proof on "hydrogen-ready" industrial devices by the end of 2021. Require proof on phaseout of carbon-intensive hydrogen production in market "within a year". Phase 2 of the ₤ 315m Industrial Energy Transformation Fund.A ₤ 55 million Industrial Fuel Switching 2 competitors in 2021. It contains strategies for hydrogen heating trials and assessment on "hydrogen-ready" boilers by 2026. " Stronger signals of intent might steer private and public financial investments into those locations which include most worth. The federal government has not clearly laid out how to pick which sectors will benefit from the initial organized 5GW of production and has instead largely left this to be figured out through trials and pilots.". The committee stresses that hydrogen use ought to be limited to "areas less matched to electrification, especially delivering and parts of industry" and offering flexibility to the power system. Federal government analysis, included in the strategy, suggests prospective hydrogen demand of approximately 38 terawatt-hours (TWh) by 2030, not including blending it into the gas grid, and increasing to 55-165TWh by 2035. The new method is clear that market will be a "lead choice" for early hydrogen usage, starting in the mid-2020s. It also says that it will "likely" be necessary for decarbonising transportation-- particularly heavy products vehicles, shipping and air travel-- and balancing a more renewables-heavy grid. My lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! For anyone brand-new to all this, the ladder is my attempt to put use cases for tidy hydrogen into some sort of merit order, due to the fact that not all use cases are similarly most likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. 4) On page 62 the hydrogen strategy states that the federal government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. Current energy need 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. " I would recommend to choose these no-regret choices for hydrogen need [in industry] that are already available ... those ought to be the focus.". Much will depend upon the progress of feasibility studies in the coming years, and the federal governments approaching heat and structures technique might also supply some clearness. Lastly, in order to create a market for hydrogen, the federal government states it will analyze blending up to 20% hydrogen into the gas network by late 2022 and goal to make a last choice in late 2023. Gniewomir Flis, a project manager at Agora Energiewende, informs Carbon Brief that-- in his view-- blending "has no future". He discusses:. How does the government plan to support the hydrogen industry? The 10-point strategy included a pledge to develop a hydrogen company design to motivate personal investment and a profits mechanism to supply financing for business model. As it stands, low-carbon hydrogen remains pricey compared to fossil fuel alternatives, there is uncertainty about the level of future demand and high risks for business intending to go into the sector. These contracts are designed to overcome the expense gap between the preferred technology and fossil fuels. Hydrogen manufacturers would be provided a payment that bridges this gap. Now that its strategy has actually been published, the federal government states it will collect proof from consultations on its low-carbon hydrogen standard, net-zero hydrogen fund and the organization design:. " This will provide us a better understanding of the mix of production innovations, how we will fulfill a ramp-up in demand, and the function that new technologies could play in achieving the levels of production necessary to fulfill our future [6th carbon budget] and net-zero commitments.". Sharelines from this story. According to the federal governments press release, its favored design is "built on a comparable facility to the offshore wind agreements for distinction (CfDs)", which substantially cut costs of brand-new overseas wind farms. 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 proof on phaseout of carbon-intensive hydrogen production in market "within a year"." As the strategy confesses, there wont be considerable amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen technique mentions that the federal government expects << 1 TWh of energy for heating to come from hydrogen by 2030. The new hydrogen technique validates that this service model will be settled in 2022, making it possible for the very first agreements to be allocated from the start of 2023. This is pending another consultation, which has actually been released alongside the primary strategy. Much of the resulting press coverage of the hydrogen method, from the Financial Times to the Daily Telegraph, concentrated on the plan for a hydrogen industry "subsidised by taxpayers", as the cash would come from either greater expenses or public funds. However, Anne-Marie Trevelyan-- minister for energy, clean development and environment change at BEIS-- informed the Times that the cost to provide long-lasting security to the industry would be "really little" for individual homes.