In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
Meanwhile, company choices around the level of hydrogen use in domestic heating and how to ensure it is produced in a low-carbon method have actually been delayed or put out to consultation for the time being.
The UKs brand-new, long-awaited hydrogen strategy provides more detail on how the government will support the advancement of a domestic low-carbon hydrogen sector, which today is practically non-existent.
In this short article, Carbon Brief highlights bottom lines from the 121-page technique and analyzes a few of the primary talking points around the UKs hydrogen plans.
Specialists have cautioned 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.
Hydrogen will be “vital” for accomplishing the UKs net-zero target and could fulfill up to a 3rd of the nations energy needs by 2050, according to the government.
Why does the UK need a hydrogen strategy?
However, similar to the majority of the federal governments net-zero strategy documents up until now, the hydrogen strategy has been postponed by months, resulting in unpredictability around the future of this recently established market.
The technique does not increase this target, although it notes that the government is “conscious of a prospective pipeline of over 15GW of tasks”.
Today we have released the UKs very first Hydrogen Strategy! This is our strategy to: kick-start an entire market unleash the marketplace to cut expenses increase domestic production unlock ₤ 4bn of private capital assistance 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
The document contains an exploration of how the UK will expand production and develop a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has actually been looking to import hydrogen from abroad.
Nevertheless, as the chart below programs, if the federal governments strategies pertain to fulfillment it might then expand considerably– making up between 20-35% of the countrys total energy supply by 2050. This will require a significant growth of facilities and skills in the UK.
In its new strategy, the UK government makes it clear that it sees low-carbon hydrogen as a crucial part of its net-zero plan, and states it desires the country to be a “international leader on hydrogen” by 2030.
Hydrogen is widely viewed as a crucial element in plans to achieve net-zero emissions and has been the subject of substantial buzz, with lots of countries prioritising it in their post-Covid green healing plans.
Its adaptability implies it can be utilized to tackle emissions in “hard-to-abate” sectors, such as heavy industry, but it currently struggles with high rates and low performance..
The level of hydrogen use in 2050 imagined by the strategy is somewhat higher than set out by the CCC in its most recent recommendations, but covers a comparable variety to other studies.
Business such as Equinor are pushing on with hydrogen advancements in the UK, but industry figures have warned that the UK dangers being left behind. Other European nations have actually promised billions to support low-carbon hydrogen growth.
A recent All Party Parliamentary Group report on the function of hydrogen in powering industry consisted of a list of demands, specifying that the federal government needs to “expand beyond its existing commitments of 5GW production in the upcoming hydrogen method”. This call has actually been echoed by some industry groups.
The Climate Change Committee (CCC) has kept in mind that, in order to hit the UKs carbon budget plans and accomplish net-zero emissions, decisions in areas such as decarbonising heating and lorries require to be made in the 2020s to permit time for facilities and car stock changes.
Critics also characterise hydrogen– the majority of which is presently made from gas– as a way for fossil fuel companies to preserve the status quo. (For all the benefits and downsides of hydrogen, see Carbon Briefs extensive explainer.).
The strategy also called for a ₤ 240m net-zero hydrogen fund, the production of a hydrogen area heated with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to reduce dependence on natural gas.
There were also over 100 references to hydrogen throughout the governments energy white paper, reflecting its prospective use in lots of sectors. It likewise includes in the commercial and transport decarbonisation methods launched previously this year.
In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the best means of decarbonisation.
Prior to the brand-new method, the prime ministers 10-point plan in November 2020 consisted of strategies to produce five gigawatts (GW) of annual low-carbon hydrogen production capacity in the UK by 2030. Presently, this capability stands at practically absolutely no.
Hydrogen demand (pink location) and proportion of final energy consumption in 2050 (%). The main range is based on illustrative net-zero consistent circumstances in the sixth carbon budget impact evaluation and the complete variety is based on the entire range from hydrogen strategy analytical annex. Source: UK hydrogen method.
Hydrogen growth for the next years is expected to start slowly, with a federal government aspiration to “see 1GW production capability by 2025” set out in the strategy.
What variety of low-carbon hydrogen will be prioritised?
The government has launched an assessment on low-carbon hydrogen requirements to accompany the technique, with a promise to “finalise design elements” of such requirements by early 2022.
The brand-new strategy mostly prevents using this colour-coding system, but it states the government has dedicated to a “twin track” method that will include the production of both ranges.
For its part, the CCC has suggested a “blue hydrogen bridge” as a helpful tool for achieving net-zero. It states allowing some blue hydrogen will lower emissions faster in the short-term by replacing more fossil fuels with hydrogen when there is inadequate green hydrogen offered..
As it stands, blue hydrogen made utilizing steam methane reformation (SMR) is the least expensive low-carbon hydrogen available, according to government analysis included in the method. (For more on the relative expenses of various hydrogen ranges, see this Carbon Brief explainer.).
In the example picked for the assessment, gas routes where CO2 capture rates are below around 85% were left out..
The figure 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 approaches above the red line, including some for producing blue hydrogen, would be left out.
It has also launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which examines optimum appropriate levels of emissions for low-carbon hydrogen production and the approach for computing these emissions.
Comparison of rate quotes throughout different innovation types at main fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
Green hydrogen is used electrolysers powered by eco-friendly electricity, while blue hydrogen is used natural gas, with the resulting emissions recorded and kept..
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 solely on green hydrogen.
The file does not do that and instead says it will provide “more detail on our production strategy and twin track method by early 2022”.
The CCC has formerly stated that the federal government must “set out [a] vision for contributions of hydrogen production from different paths to 2035” in its hydrogen strategy.
At the heart of numerous discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The previous is basically zero-carbon, however the latter can still lead to emissions due to methane leakages from natural gas infrastructure and the truth that carbon capture and storage (CCS) does not record 100% of emissions..
CO2 equivalent: Greenhouse gases can be revealed in terms of co2 equivalent, or CO2eq. For a provided amount, different greenhouse gases trap various amounts of heat in the atmosphere, an amount understood as … Read More.
The CCC has actually formerly defined “suitable emissions reductions” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas savings”.
This opposition came to a head when a current study caused headings stating that blue hydrogen is “even worse for the environment than coal”.
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, instead of “blue” or “green”, the UK would “consider carbon intensity as the main consider market advancement”.
There was significant pushback on this conclusion, with other researchers– including CCC head of carbon budgets, David Joffe– pointing out that it relied on extremely high methane leak and a short-term step of international warming capacity that stressed the impact of methane emissions over CO2.
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 argument”. He says:.
The plan notes that, sometimes, hydrogen used electrolysers “could end up being cost-competitive with CCUS [carbon storage, capture and utilisation] -allowed methane reformation as early as 2025”..
The chart below, from a document detailing hydrogen costs released together with the primary method, reveals the expected declining expense of electrolytic hydrogen with time (green lines). (This includes hydrogen used grid electricity, which is not technically green unless the grid is 100% sustainable.).
The strategy states that the percentage of hydrogen supplied by specific innovations “depends upon a variety of presumptions, which can just be tested through the marketplaces response to the policies set out in this technique and real, at-scale implementation of hydrogen”..
Many researchers and environmental groups are sceptical about blue hydrogen given its associated emissions.
CO2 equivalent: Greenhouse gases can be expressed in terms of co2 equivalent, or CO2eq. For a provided quantity, various greenhouse gases trap different quantities of heat in the atmosphere, an amount referred to as the worldwide warming capacity. Carbon dioxide equivalent is a way of comparing emissions from all greenhouse gases, not simply co2.
Quick (hopefully) showing on this blue hydrogen thing. And then cherry-picked a climate metric to make it look as bad as possible.
” If we wish to show, trial, begin to commercialise and after that roll out the use of hydrogen in industry/air travel/freight or any place, then we need enough hydrogen. We cant wait until the supply side considerations are total.”.
The CCC has alerted that policies need to develop both blue and green options, “rather than just whichever is least-cost”.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a declaration that the federal government ought to “be alive to the danger of gas industry lobbying triggering it to commit too greatly to blue hydrogen and so keeping the country locked into fossil fuel-based innovation”.
How will hydrogen be used in various sectors of the economy?
Michael Liebrich of Liebreich Associates has arranged making use of low-carbon hydrogen into a “ladder”, with existing applications– such as the chemicals market– offered leading concern.
The 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 below shows.
Reacting to the report, energy scientists pointed to the “miniscule” volumes of hydrogen expected to be produced in the near future and urged the federal government to pick its priorities carefully.
The CCC does not see substantial use of hydrogen beyond these limited cases by 2035, as the chart below programs.
” As the technique admits, there will not be substantial quantities of low-carbon hydrogen for some time.
One significant exemption is hydrogen for fuel-cell automobile. This follows the governments concentrate on electric automobiles, which many scientists consider as more cost-effective and effective technology.
The brand-new technique is clear that industry will be a “lead option” for early hydrogen use, beginning in the mid-2020s. It likewise states that it will “most likely” be necessary for decarbonising transportation– especially heavy products cars, shipping and air travel– and balancing a more renewables-heavy grid.
Some applications, such as industrial heating, might be essentially difficult without a supply of hydrogen, and lots of specialists have actually argued that these are the cases where it should be prioritised, at least in the short term.
” Stronger signals of intent could steer public and private financial investments into those locations which add most value. The government has actually not plainly set out how to pick which sectors will take advantage of the preliminary planned 5GW of production and has rather mainly left this to be identified through trials and pilots.”.
Coverage of the report and federal government promotional materials emphasised that the federal governments strategy would offer sufficient hydrogen to replace natural gas in around 3m houses each year.
It contains strategies for hydrogen heating trials and assessment on “hydrogen-ready” boilers by 2026.
Require evidence on “hydrogen-ready” commercial equipment 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 competition in 2021.
Nevertheless, the beginning point for the variety– 0TWh– recommends there is considerable uncertainty compared to other sectors, and even the greatest estimate is just around a 10th of the energy presently used to heat UK homes.
Dedications made in the brand-new strategy include:.
This is in line with the CCCs suggestion for its net-zero pathway, which sees low-carbon hydrogen scaling up to 90TWh by 2035– around a third of the size of the current power sector.
Low-carbon hydrogen can be utilized to do whatever from sustaining cars to heating homes, the truth is that it will likely be limited by the volume that can feasibly be produced.
Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen technique.
Juliet Phillips, senior policy consultant and UK hydrogen professional at thinktank E3G tells Carbon Brief the technique had “exposed” the door for usages that “do not add the most worth for the environment or economy”. She includes:.
However, in the actual report, the government said that it anticipated “overall the demand for low carbon hydrogen for heating by 2030 to be relatively low (<< 1TWh)".. 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 merit order, due to the fact that not all use cases are equally likely to be successful. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. The method also consists of the choice of utilizing hydrogen in sectors that might be much better served by electrification, especially domestic heating, where hydrogen has to contend with electrical heat pumps.. The committee emphasises that hydrogen usage must be restricted to "locations less matched to electrification, especially shipping and parts of industry" and providing flexibility to the power system. Federal government analysis, consisted of in the method, recommends possible hydrogen need of approximately 38 terawatt-hours (TWh) by 2030, not including mixing it into the gas grid, and rising to 55-165TWh by 2035. 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. 1 TWh is 0.2%. " I would recommend to choose these no-regret choices for hydrogen demand [in market] that are currently offered ... those ought to be the focus.". In order to develop a market for hydrogen, the federal government states it will take a look at blending up to 20% hydrogen into the gas network by late 2022 and goal to make a last decision in late 2023. Gniewomir Flis, a job supervisor at Agora Energiewende, tells Carbon Brief that-- in his view-- blending "has no future". He explains:. Much will depend upon the progress of expediency research studies in the coming years, and the federal governments upcoming heat and buildings method might likewise provide some clearness. How does the government strategy to support the hydrogen market? According to the federal governments press release, its preferred design is "built on a comparable premise to the offshore wind contracts for distinction (CfDs)", which considerably cut costs of new overseas wind farms. However, Anne-Marie Trevelyan-- minister for energy, tidy growth and climate modification at BEIS-- informed the Times that the cost to offer long-term security to the market would be "very small" for private families. Sharelines from this story. The 10-point strategy consisted of a promise to develop a hydrogen organization design to motivate private financial investment and a profits system to provide financing for business design. Hydrogen demand (pink location) and percentage of last 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 market "within a year"." As the method admits, there will not be considerable quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen technique mentions that the federal government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. " This will provide us a much better understanding of the mix of production technologies, how we will meet a ramp-up in need, and the function that brand-new innovations could play in attaining the levels of production required to meet our future [6th carbon budget] and net-zero commitments.". As it stands, low-carbon hydrogen stays expensive compared to fossil fuel options, there is uncertainty about the level of future demand and high threats for business aiming to enter the sector. The new hydrogen strategy confirms that this service design will be finalised in 2022, enabling the very first contracts to be assigned from the start of 2023. This is pending another assessment, which has been introduced alongside the primary method. Much of the resulting press protection of the hydrogen strategy, 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 higher costs or public funds. Now that its strategy has actually been released, the government says it will gather evidence from assessments on its low-carbon hydrogen standard, net-zero hydrogen fund and the organization model:. These agreements are designed to get rid of the expense gap between the favored innovation and fossil fuels. Hydrogen producers would be provided a payment that bridges this gap.