Company decisions around the extent of hydrogen use 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.
In this post, Carbon Brief highlights crucial points from the 121-page method and takes a look at a few of the primary talking points around the UKs hydrogen strategies.
Professionals have warned that, with hydrogen in short supply in the coming years, the UK must prioritise it in “hard-to-electrify” sectors such as heavy industry as capacity expands.
The UKs brand-new, long-awaited hydrogen method supplies more information on how the federal government will support the advancement of a domestic low-carbon hydrogen sector, which today is virtually non-existent.
Hydrogen will be “critical” for achieving the UKs net-zero target and might fulfill up to a third of the countrys energy requirements by 2050, according to the government.
Why does the UK need a hydrogen method?
Companies such as Equinor are pushing on with hydrogen advancements in the UK, however market figures have warned that the UK threats being left behind. Other European countries have actually pledged billions to support low-carbon hydrogen growth.
Today we have actually released the UKs very first Hydrogen Strategy! This is our plan to: kick-start an entire market release the market to cut expenses increase domestic production unlock ₤ 4bn of personal capital assistance 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
As with most of the federal governments net-zero technique files so far, the hydrogen plan has been postponed by months, resulting in uncertainty around the future of this recently established industry.
Hydrogen demand (pink area) and percentage 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 upon the entire range from hydrogen strategy analytical annex. Source: UK hydrogen technique.
There were also over 100 referrals to hydrogen throughout the governments energy white paper, showing its potential usage in numerous sectors. It likewise includes in the commercial and transport decarbonisation techniques launched earlier this year.
Hydrogen is widely viewed as a vital part in plans to achieve net-zero emissions and has been the topic of considerable hype, with lots of nations prioritising it in their post-Covid green healing plans.
The technique does not increase this target, although it keeps in mind that the federal government is “knowledgeable about a possible pipeline of over 15GW of jobs”.
The plan also called for a ₤ 240m net-zero hydrogen fund, the development of a hydrogen area heated with the gas by 2023, and increasing hydrogen mixing into gas networks to 20% to minimize dependence on natural gas.
As the chart below programs, if the federal governments strategies come to fulfillment it might then broaden substantially– making up between 20-35% of the countrys total energy supply by 2050. This will need a major expansion of facilities and skills in the UK.
Critics also characterise hydrogen– most of which is presently made from natural gas– as a way for nonrenewable fuel source business to maintain the status quo. (For all the advantages and drawbacks of hydrogen, see Carbon Briefs in-depth explainer.).
Its adaptability means it can be utilized to tackle emissions in “hard-to-abate” sectors, such as heavy industry, but it currently experiences high costs and low performance..
In some applications, hydrogen will complete with electrification and carbon capture and storage (CCS) as the very best means of decarbonisation.
The Climate Change Committee (CCC) has actually noted that, in order to hit the UKs carbon spending plans and attain net-zero emissions, decisions in areas such as decarbonising heating and cars need to be made in the 2020s to permit time for infrastructure and automobile stock modifications.
A recent All Party Parliamentary Group report on the function of hydrogen in powering industry consisted of a list of needs, specifying that the government needs to “expand beyond its existing dedications of 5GW production in the upcoming hydrogen method”. This call has been echoed by some industry groups.
Hydrogen development for the next decade is expected to begin gradually, with a government goal to “see 1GW production capacity by 2025” set out in the strategy.
The level of hydrogen usage in 2050 imagined by the technique is rather higher than set out by the CCC in its most recent suggestions, but covers a similar range to other studies.
Prior to the brand-new technique, the prime ministers 10-point strategy in November 2020 consisted of strategies to produce 5 gigawatts (GW) of yearly low-carbon hydrogen production capacity in the UK by 2030. Presently, this capacity stands at practically no.
In its new technique, the UK federal government makes it clear that it sees low-carbon hydrogen as an essential part of its net-zero strategy, and says it desires the country to be a “global leader on hydrogen” by 2030.
The document contains an exploration of how the UK will broaden production and develop a market for hydrogen based upon domestic supply chains. This contrasts with Germany, which has been seeking to import hydrogen from abroad.
What variety of low-carbon hydrogen will be prioritised?
At the heart of many discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
Environmental groups and numerous researchers are sceptical about blue hydrogen given its associated emissions.
The chart below, from a file outlining hydrogen costs released alongside the primary technique, reveals the anticipated decreasing cost of electrolytic hydrogen over time (green lines). (This includes hydrogen made using grid electricity, which is not technically green unless the grid is 100% renewable.).
The strategy notes that, in some cases, hydrogen used electrolysers “could become cost-competitive with CCUS [carbon storage, utilisation and capture] -allowed methane reformation as early as 2025”..
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a provided amount, different greenhouse gases trap various amounts of heat in the atmosphere, a quantity referred to as … Read More.
Nevertheless, there was considerable pushback on this conclusion, with other scientists– including CCC head of carbon spending plans, David Joffe– pointing out that it relied on really high methane leak and a short-term step of worldwide warming capacity that emphasised the effect of methane emissions over CO2.
The document does refrain from doing that and instead states it will provide “more detail on our production method and twin track method by early 2022”.
The former is essentially zero-carbon, but the latter can still result in emissions due to methane leakages from natural gas infrastructure and the reality that carbon capture and storage (CCS) does not record 100% of emissions..
CO2 equivalent: Greenhouse gases can be expressed in terms of co2 equivalent, or CO2eq. For a provided amount, various greenhouse gases trap different amounts of heat in the atmosphere, a quantity referred to as the global warming capacity. Co2 equivalent is a method of comparing emissions from all greenhouse gases, not simply 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 green vs blue hydrogen dispute”. He says:.
Quick (ideally) showing on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
In the example picked for the assessment, gas routes where CO2 capture rates are listed below around 85% were omitted..
” If we desire to demonstrate, trial, start to commercialise and then roll out the usage of hydrogen in industry/air travel/freight or wherever, then we need enough hydrogen. We cant wait until the supply side deliberations are total.”.
The figure listed below from the consultation, based on this analysis, reveals 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.
For its part, the CCC has recommended a “blue hydrogen bridge” as an useful tool for attaining net-zero. It states allowing some blue hydrogen will minimize emissions much faster in the short-term by changing more nonrenewable fuel sources with hydrogen when there is not sufficient green hydrogen available..
It has actually likewise launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which examines maximum acceptable levels of emissions for low-carbon hydrogen production and the approach for calculating these emissions.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a statement that the government ought to “be alive to the danger of gas market lobbying causing it to dedicate too heavily to blue hydrogen therefore keeping the country locked into fossil fuel-based technology”.
The strategy states that the proportion of hydrogen provided by particular technologies “depends on a variety of assumptions, which can only be tested through the markets reaction to the policies set out in this strategy and genuine, at-scale release of hydrogen”..
Comparison of rate estimates across various technology types at central fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
Green hydrogen is made using electrolysers powered by renewable electrical energy, while blue hydrogen is used natural gas, with the resulting emissions recorded and stored..
The government has actually released an assessment on low-carbon hydrogen standards to accompany the strategy, with a promise to “settle design aspects” of such standards by early 2022.
This opposition capped when a recent research study led to headlines mentioning that blue hydrogen is “even worse for the climate than coal”.
The CCC has warned that policies should develop both green and blue choices, “rather than just whichever is least-cost”.
Supporting a range of jobs will give the UK a “competitive benefit”, according to the federal government. Germany, by contrast, has stated it will focus exclusively on green hydrogen.
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 “consider carbon intensity as the primary consider market development”.
As it stands, blue hydrogen used steam methane reformation (SMR) is the least expensive low-carbon hydrogen available, according to federal government analysis included in the technique. (For more on the relative costs of different hydrogen ranges, see this Carbon Brief explainer.).
The CCC has previously specified that the federal government must “set out [a] vision for contributions of hydrogen production from various routes to 2035” in its hydrogen method.
The CCC has previously specified “appropriate emissions decreases” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas savings”.
The new strategy mainly prevents using this colour-coding system, however it says the government has actually dedicated to a “twin track” technique that will consist of the production of both ranges.
How will hydrogen be utilized in different sectors of the economy?
Low-carbon hydrogen can be utilized to do whatever from fuelling cars to heating houses, the reality is that it will likely be limited by the volume that can feasibly be produced.
Require proof on “hydrogen-ready” industrial equipment by the end of 2021. Require 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.
My lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! For anyone new to all this, the ladder is my attempt to put usage cases for clean hydrogen into some sort of merit order, because not all use cases are equally most likely to succeed. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021.
Michael Liebrich of Liebreich Associates has arranged making use of low-carbon hydrogen into a “ladder”, with current applications– such as the chemicals market– provided leading concern.
” Stronger signals of intent might steer private and public investments into those locations which include most worth. The federal government has not clearly set out how to choose which sectors will benefit from the initial scheduled 5GW of production and has instead mostly left this to be identified through trials and pilots.”.
The committee stresses that hydrogen usage should be restricted to “areas less matched to electrification, particularly delivering and parts of industry” and offering versatility to the power system.
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 might be put to this use by 2035, as the chart below suggests.
Juliet Phillips, senior policy consultant and UK hydrogen specialist at thinktank E3G informs Carbon Brief the method had actually “exposed” the door for usages that “do not add the most value for the climate or economy”. She includes:.
This is in line with the CCCs recommendation for its net-zero path, which sees low-carbon hydrogen scaling as much as 90TWh by 2035– around a 3rd of the size of the present power sector.
Commitments made in the new strategy include:.
Reacting to the report, energy scientists indicated the “little” volumes of hydrogen expected to be produced in the near future and urged the government to choose its concerns thoroughly.
The CCC does not see extensive use of hydrogen outside of these limited cases by 2035, as the chart listed below programs.
It contains prepare for hydrogen heating trials and consultation on “hydrogen-ready” boilers by 2026.
Some applications, such as commercial heating, might be essentially difficult without a supply of hydrogen, and many experts have actually argued that these are the cases where it should be prioritised, a minimum of in the brief term.
Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen method.
In the actual report, the federal government stated that it anticipated “in general the need for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. The new strategy is clear that industry will be a "lead option" for early hydrogen usage, beginning in the mid-2020s. It also says that it will "likely" be essential for decarbonising transport-- particularly heavy goods lorries, shipping and aviation-- and balancing a more renewables-heavy grid. One noteworthy exclusion is hydrogen for fuel-cell automobile. This is constant with the governments concentrate on electrical cars, which many researchers view as more economical and effective innovation. Protection of the report and government promotional materials emphasised that the governments strategy would provide sufficient hydrogen to change gas in around 3m houses each year. Federal government analysis, consisted of in the method, recommends possible hydrogen demand of up to 38 terawatt-hours (TWh) by 2030, not consisting of mixing it into the gas grid, and increasing to 55-165TWh by 2035. The beginning point for the variety-- 0TWh-- suggests there is significant unpredictability compared to other sectors, and even the greatest price quote is just around a 10th of the energy presently utilized to heat UK homes. " As the method admits, there wont be considerable quantities of low-carbon hydrogen for some time. The technique likewise includes the option of using hydrogen in sectors that might be much better served by electrification, particularly domestic heating, where hydrogen has to contend with electric heat pumps.. 4) On page 62 the hydrogen method mentions that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. 1 TWh is 0.2%. Finally, in order to produce a market for hydrogen, the government says it will analyze mixing approximately 20% hydrogen into the gas network by late 2022 and goal to make a final choice in late 2023. Much will depend upon the development of feasibility research studies in the coming years, and the governments approaching heat and buildings method may likewise provide some clarity. Gniewomir Flis, a task manager at Agora Energiewende, informs Carbon Brief that-- in his view-- mixing "has no future". He explains:. " I would suggest to choose these no-regret options for hydrogen demand [in market] that are currently available ... those must be the focus.". How does the government strategy to support the hydrogen market? Hydrogen demand (pink area) and percentage of last 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 strategy admits, there wont be significant quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen technique mentions that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. These agreements are created to conquer the cost gap in between the preferred innovation and fossil fuels. Hydrogen producers would be given a payment that bridges this space. Much of the resulting press coverage of the hydrogen technique, from the Financial Times to the Daily Telegraph, focused on the prepare for a hydrogen industry "subsidised by taxpayers", as the cash would originate from either greater costs or public funds. Anne-Marie Trevelyan-- minister for energy, tidy growth and environment change at BEIS-- informed the Times that the cost to provide long-lasting security to the industry would be "very little" for specific homes. The 10-point plan included a promise to develop a hydrogen business design to encourage personal investment and a revenue system to offer financing for the business model. As it stands, low-carbon hydrogen remains costly compared to nonrenewable fuel source alternatives, there is uncertainty about the level of future demand and high dangers for business aiming to go into the sector. Now that its strategy has actually been released, the government states it will collect evidence from consultations on its low-carbon hydrogen requirement, net-zero hydrogen fund and the service model:. Sharelines from this story. The new hydrogen strategy validates that this service model will be finalised in 2022, allowing the first agreements to be allocated from the start of 2023. This is pending another consultation, which has been introduced alongside the primary technique. " 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 function that new innovations could play in attaining the levels of production required to satisfy our future [6th carbon budget plan] and net-zero dedications.". According to the governments news release, its preferred design is "developed on a similar premise to the overseas wind agreements for difference (CfDs)", which significantly cut costs of new overseas wind farms.