In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
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In this short article, Carbon Brief highlights bottom lines from the 121-page technique and examines a few of the primary talking points around the UKs hydrogen strategies.
Experts have alerted that, with hydrogen in brief 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, company choices around the degree of hydrogen usage in domestic heating and how to ensure it is produced in a low-carbon method have been delayed or put out to consultation for the time being.
The UKs new, long-awaited hydrogen method provides more detail on how the federal government will support the advancement of a domestic low-carbon hydrogen sector, which today is virtually non-existent.
Why does the UK need a hydrogen technique?
Its versatility means it can be utilized to take on emissions in “hard-to-abate” sectors, such as heavy industry, but it presently experiences high prices and low efficiency..
However, the Climate Change Committee (CCC) has actually kept in mind that, in order to hit the UKs carbon budget plans and accomplish net-zero emissions, choices in areas such as decarbonising heating and lorries need to be made in the 2020s to allow time for infrastructure and lorry stock changes.
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 minimize reliance on natural gas.
As the chart listed below programs, if the governments plans come to fulfillment it could then broaden significantly– making up between 20-35% of the nations overall energy supply by 2050. This will need a major expansion of facilities and abilities in the UK.
There were also over 100 references to hydrogen throughout the federal governments energy white paper, showing its prospective usage in lots of sectors. It likewise includes in the commercial and transportation decarbonisation strategies launched previously this year.
Hydrogen need (pink location) and percentage of final energy consumption in 2050 (%). The main range is based on illustrative net-zero consistent circumstances in the sixth carbon budget plan impact assessment and the complete variety is based upon the entire range from hydrogen technique analytical annex. Source: UK hydrogen technique.
The technique does not increase this target, although it notes that the government is “mindful of a prospective pipeline of over 15GW of tasks”.
However, as with many of the governments net-zero technique documents so far, the hydrogen plan has actually been delayed by months, resulting in uncertainty around the future of this new market.
The file includes an exploration of how the UK will broaden production and develop a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has been aiming to import hydrogen from abroad.
Today we have published the UKs very first Hydrogen Strategy! This is our plan to: kick-start a whole market unleash the marketplace to cut costs ramp up domestic production unlock ₤ 4bn of private capital assistance 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
Hydrogen is widely viewed as a vital part in plans to attain net-zero emissions and has actually been the topic of significant buzz, with numerous nations prioritising it in their post-Covid green healing plans.
A current All Party Parliamentary Group report on the role of hydrogen in powering industry consisted of a list of demands, stating that the government must “broaden beyond its existing dedications of 5GW production in the upcoming hydrogen technique”. This call has actually been echoed by some market groups.
In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the very best ways of decarbonisation.
Prior to the new technique, the prime ministers 10-point plan in November 2020 consisted of strategies to produce five gigawatts (GW) of yearly low-carbon hydrogen production capacity in the UK by 2030. Presently, this capability stands at practically absolutely no.
Companies such as Equinor are continuing with hydrogen advancements in the UK, but market figures have cautioned that the UK risks being left behind. Other European countries have actually promised billions to support low-carbon hydrogen expansion.
In its brand-new method, the UK federal government makes it clear that it sees low-carbon hydrogen as a crucial part of its net-zero plan, and says it desires the nation to be a “international leader on hydrogen” by 2030.
The level of hydrogen usage in 2050 envisaged by the technique is rather greater than set out by the CCC in its newest advice, however covers a similar range to other research studies.
Critics also characterise hydrogen– most 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 extensive explainer.).
Hydrogen development for the next decade is expected to start gradually, with a government aspiration to “see 1GW production capacity by 2025″ set out in the technique.
What variety of low-carbon hydrogen will be prioritised?
” If we desire to show, trial, start to commercialise and then roll out making use of hydrogen in industry/air travel/freight or any place, then we require enough hydrogen. We cant wait until the supply side considerations are complete.”.
Supporting a variety of tasks will offer the UK a “competitive benefit”, according to the government. Germany, by contrast, has stated it will focus specifically on green hydrogen.
Environmental groups and many researchers are sceptical about blue hydrogen provided its associated emissions.
Prof Robert Gross, director of the UK Energy Research Centre, tells 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 says:.
Short (ideally) reflecting on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
The former is basically zero-carbon, however the latter can still result in emissions due to methane leaks from gas infrastructure and the fact that carbon capture and storage (CCS) does not catch 100% of emissions..
As it stands, blue hydrogen made utilizing steam methane reformation (SMR) is the cheapest low-carbon hydrogen offered, according to federal government analysis included in the method. (For more on the relative costs of different hydrogen varieties, see this Carbon Brief explainer.).
The CCC has formerly stated that the federal government must “set out [a] vision for contributions of hydrogen production from various routes to 2035” in its hydrogen strategy.
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a provided quantity, various greenhouse gases trap different amounts of heat in the environment, a quantity known as the international warming capacity. Co2 equivalent is a way of comparing emissions from all greenhouse gases, not just carbon dioxide.
The brand-new strategy mostly avoids utilizing this colour-coding system, however it states the government has actually devoted to a “twin track” technique that will consist of the production of both varieties.
The chart below, from a file describing hydrogen costs launched together with the main strategy, shows 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% eco-friendly.).
The CCC has warned that policies must develop both blue and green alternatives, “rather than just whichever is least-cost”.
Jess Ralston, an analyst at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a statement that the government should “be alive to the threat of gas market lobbying causing it to commit too heavily to blue hydrogen and so keeping the nation locked into fossil fuel-based technology”.
Close.
CO2 equivalent: Greenhouse gases can be expressed in terms of carbon dioxide equivalent, or CO2eq. For an offered quantity, different greenhouse gases trap different quantities of heat in the environment, an amount called … Read More.
Contrast of price quotes throughout various technology types at main fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.
Green hydrogen is used electrolysers powered by sustainable electricity, while blue hydrogen is made using natural gas, with the resulting emissions captured and saved..
There was substantial pushback on this conclusion, with other scientists– including CCC head of carbon spending plans, David Joffe– pointing out that it relied on extremely high methane leak and a short-term step of international warming potential that stressed the effect of methane emissions over CO2.
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 advancement”.
In the example selected for the assessment, natural gas routes where CO2 capture rates are listed below around 85% were omitted..
At the heart of lots of discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The figure listed below from the consultation, based upon this analysis, reveals the effect 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 previously specified “suitable emissions decreases” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
The federal government has actually released an assessment on low-carbon hydrogen standards to accompany the technique, with a promise to “settle style elements” of such standards by early 2022.
This opposition came to a head when a current research study resulted in headings mentioning that blue hydrogen is “even worse for the climate than coal”.
The document does refrain from doing that and instead states it will offer “additional information on our production method and twin track method by early 2022”.
It has actually likewise launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which takes a look at optimum acceptable levels of emissions for low-carbon hydrogen production and the approach for determining these emissions.
For its part, the CCC has actually recommended a “blue hydrogen bridge” as a helpful tool for achieving net-zero. It states permitting some blue hydrogen will reduce emissions faster in the short-term by replacing more fossil fuels with hydrogen when there is insufficient green hydrogen offered..
The strategy specifies that the percentage of hydrogen supplied by particular technologies “depends on a variety of presumptions, which can only be tested through the markets response to the policies set out in this method and real, at-scale implementation of hydrogen”..
Glossary.
The plan notes that, sometimes, hydrogen used electrolysers “might end up being cost-competitive with CCUS [carbon storage, capture and utilisation] -made it possible for methane reformation as early as 2025”..
How will hydrogen be used in different sectors of the economy?
The beginning point for the range– 0TWh– recommends there is substantial unpredictability compared to other sectors, and even the greatest quote is just around a 10th of the energy presently utilized to heat UK houses.
Low-carbon hydrogen can be used to do whatever from fuelling cars to heating homes, the truth is that it will likely be restricted by the volume that can feasibly be produced.
Protection of the report and government advertising products stressed that the governments strategy would supply enough hydrogen to change gas in around 3m houses each year.
The committee stresses that hydrogen use ought to be limited to “locations less matched to electrification, particularly delivering and parts of industry” and offering versatility to the power system.
Responding to the report, energy researchers indicated the “miniscule” volumes of hydrogen anticipated to be produced in the future and prompted the federal government to pick its top priorities carefully.
Juliet Phillips, senior policy consultant and UK hydrogen professional at thinktank E3G informs Carbon Brief the strategy had “exposed” the door for uses that “dont add the most worth for the climate or economy”. She includes:.
The brand-new strategy is clear that industry will be a “lead choice” for early hydrogen use, beginning in the mid-2020s. It also says that it will “likely” be essential for decarbonising transportation– especially heavy products lorries, shipping and air travel– and balancing a more renewables-heavy grid.
Require proof on “hydrogen-ready” commercial devices by the end of 2021. Call for proof on phaseout of carbon-intensive hydrogen production in industry “within a year”. Phase 2 of the ₤ 315m Industrial Energy Transformation Fund.A ₤ 55 million Industrial Fuel Switching 2 competition in 2021.
Government analysis, consisted of in the strategy, recommends prospective hydrogen need of approximately 38 terawatt-hours (TWh) by 2030, not consisting of mixing it into the gas grid, and rising to 55-165TWh by 2035.
It includes strategies for hydrogen heating trials and assessment on “hydrogen-ready” boilers by 2026.
In the real report, the government said that it anticipated “in general the demand for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen strategy. " Stronger signals of intent could steer public and personal investments into those locations which include most worth. The federal government has not plainly set out how to pick which sectors will benefit from the initial planned 5GW of production and has instead mainly left this to be determined through trials and pilots.". " As the method confesses, there wont be significant quantities of low-carbon hydrogen for some time. Nevertheless, the strategy also includes the option of utilizing hydrogen in sectors that may be much better served by electrification, especially domestic heating, where hydrogen has to take on electrical heat pumps.. The CCC does not see extensive usage of hydrogen beyond these restricted cases by 2035, as the chart below shows. Michael Liebrich of Liebreich Associates has arranged the use of low-carbon hydrogen into a "ladder", with existing applications-- such as the chemicals market-- provided leading concern. The government is more optimistic about making use of hydrogen in domestic heating. Its analysis suggests that approximately 45TWh of low-carbon hydrogen could be put to this use by 2035, as the chart listed below indicates. Dedications made in the new method consist of:. One noteworthy exclusion is hydrogen for fuel-cell passenger vehicles. This follows the federal governments concentrate on electric automobiles, which many researchers consider as more cost-effective and effective technology. 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 3rd of the size of the existing power sector. Some applications, such as commercial heating, might be practically difficult without a supply of hydrogen, and many professionals have actually argued that these hold true where it should be prioritised, a minimum of in the short-term. So, my lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! For anybody new to all this, the ladder is my effort to put use cases for tidy hydrogen into some sort of merit order, because not all usage cases are equally likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. 4) On page 62 the hydrogen method specifies that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. 1 TWh is 0.2%. Gniewomir Flis, a job manager at Agora Energiewende, informs Carbon Brief that-- in his view-- blending "has no future". He explains:. Finally, in order to produce a market for hydrogen, the government says it will take a look at blending as much as 20% hydrogen into the gas network by late 2022 and objective to make a final choice in late 2023. Much will depend upon the progress of feasibility studies in the coming years, and the federal governments approaching heat and buildings technique may likewise offer some clearness. " I would suggest to opt for these no-regret options for hydrogen demand [in market] that are already available ... those should be the focus.". How does the federal government plan to support the hydrogen market? These contracts are developed to get rid of the cost gap between the preferred technology and nonrenewable fuel sources. Hydrogen producers would be provided a payment that bridges this space. The 10-point strategy consisted of a pledge to establish a hydrogen service model to motivate private financial investment and a revenue mechanism to offer financing for business model. " 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 role that brand-new innovations could play in achieving the levels of production necessary to meet our future [6th carbon budget] and net-zero dedications.". Much of the resulting press coverage of the hydrogen strategy, from the Financial Times to the Daily Telegraph, focused on the strategy for a hydrogen industry "subsidised by taxpayers", as the cash would originate from either greater bills or public funds. Hydrogen demand (pink location) and proportion of final energy consumption in 2050 (%). My lovelies, I just 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 wont be significant quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen strategy states that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. According to the federal governments press release, its favored design is "built on a similar facility to the offshore wind contracts for distinction (CfDs)", which considerably cut expenses of new overseas wind farms. The new hydrogen method validates that this business design will be settled in 2022, making it possible for the very first contracts to be assigned from the start of 2023. This is pending another assessment, which has been launched along with the primary technique. Now that its strategy has actually been released, the government states it will gather evidence from consultations on its low-carbon hydrogen standard, net-zero hydrogen fund and business model:. Sharelines from this story. As it stands, low-carbon hydrogen remains pricey compared to nonrenewable fuel source alternatives, there is uncertainty about the level of future demand and high risks for business intending to go into the sector. Anne-Marie Trevelyan-- minister for energy, tidy development and climate modification at BEIS-- informed the Times that the cost to provide long-term security to the market would be "really small" for specific households.