In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
Professionals have warned that, with hydrogen in short supply in the coming years, the UK should prioritise it in “hard-to-electrify” sectors such as heavy market as capacity expands.
Firm decisions around the level of hydrogen usage in domestic heating and how to guarantee it is produced in a low-carbon way have actually been postponed or put out to assessment for the time being.
In this article, Carbon Brief highlights bottom lines from the 121-page technique and analyzes some of the primary talking points around the UKs hydrogen plans.
Hydrogen will be “vital” for attaining the UKs net-zero target and might fulfill up to a 3rd of the nations energy needs by 2050, according to the government.
The UKs new, long-awaited hydrogen method provides more detail on how the government will support the advancement of a domestic low-carbon hydrogen sector, which today is essentially non-existent.
Why does the UK require a hydrogen technique?
In its new strategy, the UK government makes it clear that it sees low-carbon hydrogen as a key part of its net-zero plan, and states it desires the country to be a “global leader on hydrogen” by 2030.
Prior to the brand-new method, the prime ministers 10-point plan in November 2020 included plans to produce 5 gigawatts (GW) of annual low-carbon hydrogen production capacity in the UK by 2030. Presently, this capability stands at practically no.
A recent All Party Parliamentary Group report on the function of hydrogen in powering industry consisted of a list of demands, mentioning that the government must “expand beyond its existing dedications of 5GW production in the upcoming hydrogen strategy”. This call has been echoed by some market groups.
The document contains 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.
There were also over 100 references to hydrogen throughout the governments energy white paper, showing its prospective usage in lots of sectors. It likewise includes in the industrial and transportation decarbonisation techniques launched earlier this year.
The technique does not increase this target, although it keeps in mind that the government is “knowledgeable about a potential pipeline of over 15GW of jobs”.
Its flexibility indicates it can be utilized to take on emissions in “hard-to-abate” sectors, such as heavy market, however it currently suffers from high costs and low performance..
However, just like most of the federal governments net-zero strategy files so far, the hydrogen plan has been delayed by months, leading to uncertainty around the future of this recently established industry.
Hydrogen demand (pink location) and proportion of final energy intake in 2050 (%). The central range is based on illustrative net-zero consistent scenarios in the 6th carbon budget plan effect evaluation and the full range is based upon the entire variety from hydrogen strategy analytical annex. Source: UK hydrogen technique.
Hydrogen growth for the next years is expected to begin slowly, with a federal government aspiration to “see 1GW production capability by 2025” laid out in the strategy.
Business such as Equinor are continuing with hydrogen developments in the UK, but market figures have actually cautioned that the UK threats being left. Other European countries have vowed billions to support low-carbon hydrogen growth.
In some applications, hydrogen will compete with electrification and carbon capture and storage (CCS) as the best means of decarbonisation.
Hydrogen is widely seen as an important part in plans to accomplish net-zero emissions and has been the subject of significant hype, with many nations prioritising it in their post-Covid green recovery strategies.
Today we have released the UKs very first Hydrogen Strategy! This is our strategy to: kick-start a whole industry let loose the market to cut expenses ramp up domestic production unlock ₤ 4bn of personal capital support 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
The level of hydrogen use in 2050 imagined by the technique is rather higher than set out by the CCC in its latest guidance, however covers a comparable variety to other research studies.
Critics also characterise hydrogen– the majority of which is currently 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 in-depth explainer.).
The Climate Change Committee (CCC) has noted that, in order to strike the UKs carbon spending plans and achieve net-zero emissions, choices in areas such as decarbonising heating and cars require to be made in the 2020s to permit time for infrastructure and car stock modifications.
As the chart below shows, if the governments plans come to fruition it might then broaden considerably– making up in between 20-35% of the nations overall energy supply by 2050. This will need a significant growth of facilities and skills in the UK.
The plan likewise called for a ₤ 240m net-zero hydrogen fund, the production of a hydrogen area warmed with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to lower reliance on natural gas.
What range of low-carbon hydrogen will be prioritised?
The CCC has previously mentioned that the government must “set out [a] vision for contributions of hydrogen production from different paths to 2035” in its hydrogen technique.
As it stands, blue hydrogen made using 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 different hydrogen varieties, see this Carbon Brief explainer.).
Jess Ralston, an analyst at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a declaration that the federal government ought to “be alive to the threat of gas market lobbying causing it to commit too heavily to blue hydrogen therefore keeping the nation locked into fossil fuel-based innovation”.
The CCC has cautioned that policies need to establish both blue and green alternatives, “rather than just whichever is least-cost”.
” If we desire to demonstrate, trial, start to commercialise and then roll out the use of hydrogen in industry/air travel/freight or wherever, then we require enough hydrogen. We cant wait up until the supply side deliberations are total.”.
The file does not do that and rather says it will offer “further detail on our production technique and twin track technique by early 2022”.
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, instead of “blue” or “green”, the UK would “think about carbon strength as the main element in market development”.
This opposition came to a head when a current study caused headlines mentioning that blue hydrogen is “worse for the climate than coal”.
The figure below from the consultation, based on this analysis, shows the effect 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.
The former is essentially zero-carbon, however the latter can still lead to emissions due to methane leakages from natural gas facilities and the fact that carbon capture and storage (CCS) does not record 100% of emissions..
The strategy specifies that the percentage of hydrogen provided by specific technologies “depends on a series of presumptions, which can just be checked through the marketplaces response to the policies set out in this technique and genuine, at-scale release of hydrogen”..
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a given amount, various greenhouse gases trap various quantities of heat in the environment, an amount called the global warming capacity. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not just co2.
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 dispute”. He says:.
There was considerable pushback on this conclusion, with other scientists– consisting of CCC head of carbon budget plans, David Joffe– pointing out that it relied on extremely high methane leak and a short-term measure of global warming capacity that emphasised the impact of methane emissions over CO2.
The chart below, from a file describing hydrogen costs released alongside the main strategy, shows the anticipated declining cost of electrolytic hydrogen with time (green lines). (This consists of hydrogen made using grid electrical power, which is not technically green unless the grid is 100% sustainable.).
Many researchers and environmental groups are sceptical about blue hydrogen offered its associated emissions.
The new technique largely prevents utilizing this colour-coding system, but it says the government has committed to a “twin track” method that will consist of the production of both ranges.
Comparison of price estimates throughout different innovation types at central fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
It has actually likewise released an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which analyzes optimum appropriate levels of emissions for low-carbon hydrogen production and the methodology for computing these emissions.
At the heart of lots of discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
Green hydrogen is made using electrolysers powered by sustainable electrical energy, while blue hydrogen is used natural gas, with the resulting emissions captured and saved..
For its part, the CCC has actually recommended a “blue hydrogen bridge” as a helpful tool for achieving net-zero. It states allowing some blue hydrogen will decrease emissions faster in the short-term by changing more nonrenewable fuel sources with hydrogen when there is not adequate green hydrogen offered..
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a given quantity, various greenhouse gases trap different amounts of heat in the atmosphere, an amount called … Read More.
The plan notes that, in some cases, hydrogen used electrolysers “could become cost-competitive with CCUS [carbon capture, utilisation and storage] -made it possible for methane reformation as early as 2025”..
The CCC has actually previously defined “ideal emissions decreases” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas savings”.
Supporting a variety of jobs will give the UK a “competitive benefit”, according to the federal government. Germany, by contrast, has said it will focus exclusively on green hydrogen.
In the example selected for the assessment, natural gas paths where CO2 capture rates are below around 85% were omitted..
Brief (hopefully) showing on this blue hydrogen thing. And then cherry-picked a climate metric to make it look as bad as possible.
The government has actually launched a consultation on low-carbon hydrogen standards to accompany the technique, with a promise to “finalise style elements” of such standards by early 2022.
How will hydrogen be used in various sectors of the economy?
” Stronger signals of intent could steer public and private financial investments into those areas which include most value. The government has actually not clearly laid out how to choose which sectors will gain from the initial planned 5GW of production and has rather mostly left this to be determined through pilots and trials.”.
Nevertheless, in the actual report, the federal government stated that it expected “overall the demand for low carbon hydrogen for heating by 2030 to be relatively low (<< 1TWh)".. Government analysis, consisted of in the strategy, recommends prospective hydrogen demand of as much as 38 terawatt-hours (TWh) by 2030, not consisting of blending it into the gas grid, and rising to 55-165TWh by 2035. The federal government is more positive about making use of hydrogen in domestic heating. Its analysis suggests that up to 45TWh of low-carbon hydrogen could be put to this usage by 2035, as the chart listed below shows. Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen method. Reacting to the report, energy researchers pointed to the "miniscule" volumes of hydrogen anticipated to be produced in the near future and urged the federal government to pick its priorities thoroughly. " As the method admits, there will not be significant quantities of low-carbon hydrogen for some time. Protection of the report and government marketing products emphasised that the governments plan would offer sufficient hydrogen to change natural gas in around 3m homes each year. 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 usage cases for tidy hydrogen into some sort of benefit order, because not all usage cases are equally most likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. Commitments made in the new technique consist of:. It contains strategies for hydrogen heating trials and assessment on "hydrogen-ready" boilers by 2026. Some applications, such as commercial heating, may be essentially impossible without a supply of hydrogen, and lots of professionals have argued that these hold true where it must be prioritised, at least in the short term. Nevertheless, the strategy also includes the option of using hydrogen in sectors that may be much better served by electrification, especially domestic heating, where hydrogen needs to compete with electric heat pumps.. Low-carbon hydrogen can be utilized to do everything from fuelling vehicles to heating houses, the truth is that it will likely be limited by the volume that can feasibly be produced. The CCC does not see comprehensive usage of hydrogen outside of these limited cases by 2035, as the chart below programs. One significant exclusion is hydrogen for fuel-cell automobile. This is consistent with the governments focus on electric cars and trucks, which numerous researchers consider as more effective and economical technology. Michael Liebrich of Liebreich Associates has organised making use of low-carbon hydrogen into a "ladder", with current applications-- such as the chemicals market-- provided top priority. The beginning point for the range-- 0TWh-- suggests there is considerable uncertainty compared to other sectors, and even the highest estimate is only around a 10th of the energy presently used to heat UK houses. This is in line with the CCCs suggestion for its net-zero path, which sees low-carbon hydrogen scaling approximately 90TWh by 2035-- around a third of the size of the existing power sector. Juliet Phillips, senior policy consultant and UK hydrogen professional at thinktank E3G informs Carbon Brief the technique had "left open" the door for uses that "dont include the most value for the environment or economy". She includes:. Call for proof on "hydrogen-ready" industrial equipment 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 competitors in 2021. The committee stresses that hydrogen use ought to be restricted to "areas less suited to electrification, particularly shipping and parts of market" and supplying flexibility to the power system. The new technique is clear that market will be a "lead option" for early hydrogen use, beginning in the mid-2020s. It likewise states that it will "likely" be very important for decarbonising transport-- especially heavy products automobiles, shipping and aviation-- and balancing a more renewables-heavy grid. 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. 1 TWh is 0.2%. " I would recommend to choose these no-regret options for hydrogen demand [in industry] that are already readily available ... those should be the focus.". Gniewomir Flis, a job supervisor at Agora Energiewende, informs Carbon Brief that-- in his view-- blending "has no future". He explains:. In order to develop a market for hydrogen, the federal government says it will examine blending up to 20% hydrogen into the gas network by late 2022 and goal to make a final decision in late 2023. Much will depend upon the progress of expediency studies in the coming years, and the governments upcoming heat and buildings method may likewise provide some clarity. How does the government strategy to support the hydrogen industry? Sharelines from this story. " This will give us a much better understanding of the mix of production technologies, how we will satisfy a ramp-up in demand, and the function that brand-new technologies might play in attaining the levels of production essential to meet our future [6th carbon spending plan] and net-zero commitments.". These agreements are developed to get rid of the cost gap between the preferred innovation and fossil fuels. Hydrogen manufacturers would be provided a payment that bridges this space. However, Anne-Marie Trevelyan-- minister for energy, tidy development and climate change at BEIS-- informed the Times that the cost to supply long-lasting security to the market would be "extremely small" for private homes. Hydrogen need (pink location) and percentage of final energy intake in 2050 (%). My lovelies, I just 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 method confesses, there will not 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. According to the governments press release, its preferred design is "developed on a comparable property to the offshore wind contracts for difference (CfDs)", which substantially cut expenses of new overseas wind farms. Now that its technique has actually been published, the government states it will collect proof from assessments on its low-carbon hydrogen standard, net-zero hydrogen fund and business model:. 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 market "subsidised by taxpayers", as the cash would originate from either higher bills or public funds. The new hydrogen technique confirms that this business design will be finalised in 2022, allowing the very first contracts to be assigned from the start of 2023. This is pending another assessment, which has actually been released together with the main technique. The 10-point strategy included a pledge to establish a hydrogen service design to motivate private investment and an earnings mechanism to supply financing for the service model. As it stands, low-carbon hydrogen stays costly compared to nonrenewable fuel source alternatives, there is unpredictability about the level of future need and high threats for companies intending to go into the sector.