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 market as capability expands.
In this post, Carbon Brief highlights crucial points from the 121-page strategy and takes a look at some of the main talking points around the UKs hydrogen plans.
Hydrogen will be “vital” for attaining the UKs net-zero target and might utilize up to a 3rd of the nations energy by 2050, according to the federal government.
The UKs new, long-awaited hydrogen strategy supplies more detail on how the federal government will support the advancement of a domestic low-carbon hydrogen sector, which today is virtually non-existent.
Meanwhile, company decisions around the degree of hydrogen usage in domestic heating and how to guarantee it is produced in a low-carbon method have been delayed or put out to assessment for the time being.
Why does the UK require a hydrogen strategy?
Business such as Equinor are continuing with hydrogen advancements in the UK, however industry figures have actually cautioned that the UK threats being left behind. Other European countries have actually vowed billions to support low-carbon hydrogen expansion.
In its new method, the UK 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 “international leader on hydrogen” by 2030.
Hydrogen is commonly viewed as an essential element in strategies to accomplish net-zero emissions and has actually been the topic of considerable buzz, with numerous nations prioritising it in their post-Covid green recovery plans.
In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the very best methods of decarbonisation.
Nevertheless, as the chart listed below programs, if the federal governments plans come to fruition it could then expand considerably– using up in between 20-35% of the nations total energy supply by 2050. This will require a significant growth of facilities and skills in the UK.
Hydrogen development for the next decade is expected to start gradually, with a federal government aspiration to “see 1GW production capability by 2025” set out in the method.
The plan also required a ₤ 240m net-zero hydrogen fund, the creation of a hydrogen area heated up with the gas by 2023, and increasing hydrogen mixing into gas networks to 20% to minimize reliance on natural gas.
Hydrogen demand (pink area) and proportion of last energy intake in 2050 (%). The central range is based on illustrative net-zero constant situations in the 6th carbon budget plan effect assessment and the complete range is based upon the entire range from hydrogen technique analytical annex. Source: UK hydrogen strategy.
As with many of the federal governments net-zero strategy files so far, the hydrogen strategy has been delayed by months, resulting in uncertainty around the future of this new industry.
Prior to the brand-new strategy, the prime ministers 10-point plan in November 2020 included strategies to produce 5 gigawatts (GW) of yearly low-carbon hydrogen production in the UK by 2030. Presently, this capability stands at essentially absolutely no.
Its flexibility indicates it can be utilized to take on emissions in “hard-to-abate” sectors, such as heavy industry, however it currently suffers from high costs and low effectiveness..
Today we have actually published the UKs very first Hydrogen Strategy! This is our strategy to: kick-start an entire market let loose the market to cut costs increase domestic production unlock ₤ 4bn of personal capital assistance 9k jobs #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
Critics likewise characterise hydrogen– most of which is presently made from gas– as a way for fossil fuel business to preserve the status quo. (For all the benefits and disadvantages of hydrogen, see Carbon Briefs thorough explainer.).
The document includes an exploration of how the UK will broaden production and produce a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has been looking to import hydrogen from abroad.
The strategy does not increase this target, although it notes that the government is “familiar with a prospective pipeline of over 15GW of tasks”.
Nevertheless, the Climate Change Committee (CCC) has kept in mind that, in order to strike the UKs carbon budget plans and attain net-zero emissions, decisions in locations such as decarbonising heating and cars require to be made in the 2020s to enable time for facilities and vehicle stock modifications.
A current All Party Parliamentary Group report on the role of hydrogen in powering market consisted of a list of demands, stating that the government needs to “expand beyond its existing commitments of 5GW production in the upcoming hydrogen strategy”. This call has actually been echoed by some industry groups.
There were likewise over 100 recommendations to hydrogen throughout the governments energy white paper, reflecting its potential usage in lots of sectors. It also includes in the commercial and transportation decarbonisation strategies released earlier this year.
What range of low-carbon hydrogen will be prioritised?
Green hydrogen is made using electrolysers powered by renewable electricity, while blue hydrogen is used gas, with the resulting emissions recorded and stored..
In the example chosen for the assessment, gas routes where CO2 capture rates are listed below around 85% were left out..
The federal government has launched a consultation on low-carbon hydrogen requirements to accompany the strategy, with a pledge to “settle style components” of such requirements by early 2022.
CO2 equivalent: Greenhouse gases can be expressed in regards to co2 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 simply carbon dioxide.
For its part, the CCC has actually recommended a “blue hydrogen bridge” as an useful tool for attaining net-zero. It states permitting some blue hydrogen will decrease emissions quicker in the short-term by replacing more fossil fuels with hydrogen when there is insufficient green hydrogen offered..
As it stands, blue hydrogen used steam methane reformation (SMR) is the cheapest low-carbon hydrogen available, according to government analysis consisted of in the technique. (For more on the relative costs of various hydrogen ranges, see this Carbon Brief explainer.).
Supporting a range of projects will provide the UK a “competitive benefit”, according to the federal government. Germany, by contrast, has said it will focus solely on green hydrogen.
The CCC has actually warned that policies need to establish both green and blue alternatives, “rather than just whichever is least-cost”.
Brief (hopefully) showing on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
The CCC has actually previously specified that the federal government needs to “set out [a] vision for contributions of hydrogen production from various routes to 2035″ in its hydrogen strategy.
It has actually likewise released 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 calculating these emissions.
” If we wish to demonstrate, trial, start to commercialise and then roll out making use of hydrogen in industry/air travel/freight or wherever, then we need enough hydrogen. We cant wait up until the supply side considerations are complete.”.
The figure below from the assessment, based upon 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.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a statement that the federal government must “be alive to the danger of gas industry lobbying triggering it to dedicate too heavily to blue hydrogen therefore keeping the nation locked into fossil fuel-based innovation”.
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For an offered quantity, different greenhouse gases trap different amounts of heat in the environment, a quantity referred to as … Read More.
Comparison of rate estimates throughout different technology types at central fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
There was significant pushback on this conclusion, with other researchers– including CCC head of carbon spending plans, David Joffe– pointing out that it relied on really high methane leakage and a short-term procedure of worldwide warming potential that stressed the impact of methane emissions over CO2.
This opposition came to a head when a recent research study caused headlines mentioning that blue hydrogen is “even worse for the climate than coal”.
The previous is basically zero-carbon, but the latter can still lead to emissions due to methane leaks from gas facilities and the reality that carbon capture and storage (CCS) does not record 100% of emissions..
The method states that the proportion of hydrogen supplied by specific technologies “depends on a variety of assumptions, which can only be evaluated through the markets reaction to the policies set out in this method and genuine, at-scale release of hydrogen”..
The plan notes that, sometimes, hydrogen made using electrolysers “could become cost-competitive with CCUS [carbon storage, capture and utilisation] -enabled methane reformation as early as 2025”..
The CCC has actually formerly specified “appropriate emissions reductions” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
Environmental groups and numerous researchers are sceptical about blue hydrogen offered its associated emissions.
The document does not do that and instead says it will provide “further detail on our production method and twin track approach by early 2022”.
At the heart of numerous discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
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 main element in market development”.
The new technique largely prevents using this colour-coding system, however it states the federal government has actually devoted to a “twin track” technique that will consist of the production of both varieties.
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 debate”. He states:.
The chart below, from a file describing hydrogen costs launched along with the main strategy, reveals the anticipated declining cost of electrolytic hydrogen over time (green lines). (This consists of hydrogen used grid electrical energy, which is not technically green unless the grid is 100% eco-friendly.).
How will hydrogen be used in various sectors of the economy?
The brand-new method is clear that market will be a “lead alternative” for early hydrogen use, starting in the mid-2020s. It likewise states that it will “most likely” be essential for decarbonising transport– especially heavy items lorries, shipping and air travel– and stabilizing a more renewables-heavy grid.
However, the method likewise includes the option of utilizing hydrogen in sectors that might be better served by electrification, particularly domestic heating, where hydrogen needs to take on electrical heat pumps..
Reacting to the report, energy scientists indicated the “little” volumes of hydrogen expected to be produced in the future and prompted the government to select its concerns carefully.
The beginning point for the variety– 0TWh– recommends there is considerable unpredictability compared to other sectors, and even the highest estimate is just around a 10th of the energy presently utilized to heat UK houses.
The CCC does not see comprehensive use of hydrogen beyond these limited cases by 2035, as the chart listed below shows.
Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen strategy.
Dedications made in the new technique consist of:.
” Stronger signals of intent could guide public and personal investments into those locations which add most value. The government has actually not clearly laid out how to pick which sectors will benefit from the initial planned 5GW of production and has instead mainly left this to be identified through pilots and trials.”.
It includes plans for hydrogen heating trials and consultation on “hydrogen-ready” boilers by 2026.
Require evidence on “hydrogen-ready” commercial devices by the end of 2021. Call for evidence 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 competition in 2021.
Michael Liebrich of Liebreich Associates has organised making use of low-carbon hydrogen into a “ladder”, with existing applications– such as the chemicals market– offered top concern.
This remains in line with the CCCs suggestion for its net-zero pathway, which sees low-carbon hydrogen scaling as much as 90TWh by 2035– around a 3rd of the size of the existing power sector.
However, in the real report, the federal government stated that it expected “overall the need for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. Some applications, such as industrial heating, may be virtually difficult without a supply of hydrogen, and many professionals have argued that these are the cases where it need to be prioritised, at least in the brief term. Juliet Phillips, senior policy advisor and UK hydrogen specialist at thinktank E3G informs Carbon Brief the method had "left open" the door for uses that "do not add the most worth for the environment or economy". She adds:. So, my lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! For anyone new to all this, the ladder is my effort to put use cases for clean hydrogen into some sort of benefit order, because not all use cases are similarly likely to be successful. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. The government is more positive about the use 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 listed below suggests. " As the method confesses, there wont be substantial amounts of low-carbon hydrogen for some time. Government analysis, included in the technique, suggests prospective hydrogen demand of up to 38 terawatt-hours (TWh) by 2030, not including mixing it into the gas grid, and rising to 55-165TWh by 2035. Low-carbon hydrogen can be utilized to do everything from sustaining automobiles to heating houses, the truth is that it will likely be limited by the volume that can probably be produced. Protection of the report and government promotional products stressed that the governments plan would offer adequate hydrogen to change gas in around 3m homes each year. One significant exclusion is hydrogen for fuel-cell passenger cars. This follows the governments concentrate on electric cars, which many scientists view as more effective and economical technology. The committee stresses that hydrogen usage need to be restricted to "locations less suited to electrification, particularly delivering and parts of industry" and supplying flexibility to the power system. 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 homes.-- Jan Rosenow (@janrosenow) August 17, 2021. Lastly, in order to develop a market for hydrogen, the federal government says it will examine blending approximately 20% hydrogen into the gas network by late 2022 and objective to make a last decision in late 2023. Gniewomir Flis, a project manager at Agora Energiewende, tells Carbon Brief that-- in his view-- blending "has no future". He explains:. Much will depend upon the progress of feasibility studies in the coming years, and the federal governments upcoming heat and buildings strategy might also supply some clarity. " I would suggest to choose these no-regret alternatives for hydrogen need [in market] that are currently offered ... those must be the focus.". How does the federal government plan to support the hydrogen market? These contracts are developed to conquer the cost gap between the preferred technology and nonrenewable fuel sources. Hydrogen manufacturers would be provided a payment that bridges this space. The brand-new hydrogen technique confirms that this company model will be finalised in 2022, making it possible for the very first agreements to be designated from the start of 2023. This is pending another assessment, which has been launched along with the primary method. Hydrogen demand (pink location) and proportion of final energy usage 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 confesses, there wont be considerable amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method specifies that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. " This will give us a much better understanding of the mix of production technologies, how we will fulfill a ramp-up in demand, and the role that new technologies might play in attaining the levels of production necessary to satisfy our future [6th carbon budget plan] and net-zero dedications.". As it stands, low-carbon hydrogen remains pricey compared to nonrenewable fuel source options, there is unpredictability about the level of future need and high risks for companies aiming to go into the sector. Much of the resulting press coverage of the hydrogen strategy, from the Financial Times to the Daily Telegraph, concentrated on the prepare for a hydrogen industry "subsidised by taxpayers", as the cash would come from either higher bills or public funds. According to the governments news release, its favored design is "built on a similar property to the offshore wind contracts for difference (CfDs)", which substantially cut costs of new offshore wind farms. However, Anne-Marie Trevelyan-- minister for energy, clean development and environment change at BEIS-- told the Times that the cost to offer long-term security to the industry would be "really small" for private households. Sharelines from this story. Now that its method has been published, the federal government says it will gather evidence from assessments on its low-carbon hydrogen standard, net-zero hydrogen fund and the service model:. The 10-point plan consisted of a promise to develop a hydrogen service design to motivate personal investment and a revenue mechanism to supply funding for business model.