In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
The UKs brand-new, long-awaited hydrogen technique provides more information on how the government will support the development of a domestic low-carbon hydrogen sector, which today is virtually non-existent.
Company decisions around the extent of hydrogen use in domestic heating and how to ensure it is produced in a low-carbon way have actually been postponed or put out to assessment for the time being.
Hydrogen will be “crucial” for attaining the UKs net-zero target and could satisfy up to a 3rd of the nations energy needs by 2050, according to the federal government.
In this short article, Carbon Brief highlights key points from the 121-page strategy and takes a look at a few of the main talking points around the UKs hydrogen strategies.
Professionals have actually 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 market as capacity expands.
Why does the UK require a hydrogen strategy?
A recent All Party Parliamentary Group report on the role of hydrogen in powering market consisted of a list of needs, mentioning that the government should “expand beyond its existing commitments of 5GW production in the upcoming hydrogen strategy”. This call has actually been echoed by some market groups.
Hydrogen need (pink area) and percentage of final energy usage in 2050 (%). The main variety is based on illustrative net-zero constant scenarios in the sixth carbon budget plan impact evaluation and the complete range is based upon the entire variety from hydrogen technique analytical annex. Source: UK hydrogen technique.
The method does not increase this target, although it notes that the government is “aware of a potential pipeline of over 15GW of tasks”.
The plan likewise required a ₤ 240m net-zero hydrogen fund, the development of a hydrogen area heated with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to lower reliance on gas.
The level of hydrogen use in 2050 imagined by the technique is rather higher than set out by the CCC in its latest suggestions, but covers a similar variety to other studies.
There were also over 100 referrals to hydrogen throughout the governments energy white paper, showing its prospective use in numerous sectors. It likewise includes in the industrial and transport decarbonisation methods released previously this year.
As the chart below shows, if the governments strategies come to fulfillment it might then broaden significantly– making up between 20-35% of the nations total energy supply by 2050. This will need a major expansion of infrastructure and abilities in the UK.
Hydrogen is commonly seen as a vital element in plans to accomplish net-zero emissions and has actually been the subject of substantial buzz, with many countries prioritising it in their post-Covid green healing plans.
Today we have actually released the UKs very first Hydrogen Strategy! This is our plan to: kick-start a whole industry release 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.
Hydrogen development for the next years is anticipated to begin gradually, with a government aspiration to “see 1GW production capability by 2025” laid out in the strategy.
The file includes an expedition of how the UK will broaden production and produce a market for hydrogen based upon domestic supply chains. This contrasts with Germany, which has been looking to import hydrogen from abroad.
Critics likewise characterise hydrogen– the majority of which is presently made from gas– as a way for nonrenewable fuel source companies to maintain the status quo. (For all the benefits and drawbacks of hydrogen, see Carbon Briefs thorough explainer.).
Its adaptability indicates it can be used to take on emissions in “hard-to-abate” sectors, such as heavy market, however it currently experiences high rates and low efficiency..
Business such as Equinor are pressing on with hydrogen advancements in the UK, but industry figures have warned that the UK threats being left behind. Other European countries have pledged billions to support low-carbon hydrogen expansion.
Prior to the new technique, the prime ministers 10-point plan in November 2020 included plans to produce five gigawatts (GW) of yearly low-carbon hydrogen production capacity in the UK by 2030. Presently, this capacity stands at essentially absolutely no.
As with many of the governments net-zero technique files so far, the hydrogen strategy has been delayed by months, resulting in unpredictability around the future of this new market.
The Climate Change Committee (CCC) has actually noted that, in order to strike the UKs carbon budget plans and accomplish net-zero emissions, decisions in locations such as decarbonising heating and automobiles need to be made in the 2020s to enable time for facilities and vehicle stock changes.
In some applications, hydrogen will take on electrification and carbon capture and storage (CCS) as the best ways of decarbonisation.
In its brand-new technique, the UK government makes it clear that it sees low-carbon hydrogen as a crucial part of its net-zero plan, and says it wants the nation to be a “global leader on hydrogen” by 2030.
What range of low-carbon hydrogen will be prioritised?
It has actually likewise launched an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which examines maximum appropriate levels of emissions for low-carbon hydrogen production and the method for calculating these emissions.
The chart below, from a file outlining hydrogen expenses released alongside the primary strategy, shows the expected declining expense of electrolytic hydrogen gradually (green lines). (This consists of hydrogen made utilizing grid electrical power, which is not technically green unless the grid is 100% sustainable.).
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 strength as the primary consider market development”.
This opposition capped when a current study resulted in headings mentioning that blue hydrogen is “even worse for the environment than coal”.
At the heart of lots of conversations about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
Comparison of price estimates throughout various innovation types at main fuel rates commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.
Glossary.
Green hydrogen is used electrolysers powered by eco-friendly electricity, while blue hydrogen is made utilizing natural gas, with the resulting emissions captured and stored..
For its part, the CCC has actually suggested a “blue hydrogen bridge” as a helpful tool for attaining net-zero. It states enabling some blue hydrogen will decrease emissions quicker in the short-term by changing more nonrenewable fuel sources with hydrogen when there is insufficient green hydrogen offered..
The new strategy mostly avoids utilizing this colour-coding system, but it states the federal government has dedicated to a “twin track” technique that will include the production of both ranges.
The strategy states that the percentage of hydrogen provided by particular technologies “depends upon a series of assumptions, which can only be checked through the marketplaces reaction to the policies set out in this technique and real, at-scale implementation of hydrogen”..
Supporting a range of projects will offer the UK a “competitive benefit”, according to the government. Germany, by contrast, has stated it will focus specifically on green hydrogen.
Prof Robert Gross, director of the UK Energy Research Centre, tells 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:.
Close.
CO2 equivalent: Greenhouse gases can be revealed in terms of co2 equivalent, or CO2eq. For an offered amount, different greenhouse gases trap different quantities of heat in the environment, an amount called … Read More.
The figure 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 methods above the red line, consisting of some for producing blue hydrogen, would be left out.
The file does not do that and instead says it will provide “more information on our production strategy and twin track technique by early 2022”.
Environmental groups and numerous researchers are sceptical about blue hydrogen provided its associated emissions.
Nevertheless, there was substantial pushback on this conclusion, with other researchers– including CCC head of carbon budget plans, David Joffe– explaining that it counted on really high methane leakage and a short-term step of global warming capacity that stressed the effect of methane emissions over CO2.
In the example chosen for the assessment, gas routes where CO2 capture rates are listed below around 85% were omitted..
The strategy notes that, in some cases, hydrogen made utilizing electrolysers “might end up being cost-competitive with CCUS [carbon capture, storage and utilisation] -made it possible for methane reformation as early as 2025”..
The CCC has actually warned that policies must establish both blue and green choices, “instead of simply whichever is least-cost”.
CO2 equivalent: Greenhouse gases can be expressed in terms of co2 equivalent, or CO2eq. For a provided amount, various greenhouse gases trap various quantities of heat in the atmosphere, an amount understood as the international warming capacity. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not simply carbon dioxide.
” If we wish to demonstrate, trial, start to commercialise and after that roll out the usage of hydrogen in industry/air travel/freight or anywhere, then we need enough hydrogen. We cant wait until the supply side deliberations are total.”.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), said in a statement that the government should “be alive to the danger of gas industry lobbying causing it to devote too greatly to blue hydrogen therefore keeping the country locked into fossil fuel-based innovation”.
The CCC has formerly specified that the federal government should “set out [a] vision for contributions of hydrogen production from different routes to 2035” in its hydrogen strategy.
The former is basically zero-carbon, however the latter can still lead to emissions due to methane leakages from natural gas infrastructure and the reality that carbon capture and storage (CCS) does not record 100% of emissions..
The government has actually launched an assessment on low-carbon hydrogen requirements to accompany the method, with a pledge to “settle design elements” of such requirements by early 2022.
The CCC has previously specified “ideal emissions reductions” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
Brief (hopefully) reflecting on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
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 method. (For more on the relative costs of different hydrogen ranges, see this Carbon Brief explainer.).
How will hydrogen be used in different sectors of the economy?
In the actual report, the federal government said that it anticipated “in general the need for low carbon hydrogen for heating by 2030 to be reasonably low (<< 1TWh)".. Call for 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 competitors in 2021. The committee stresses that hydrogen usage need to be restricted to "areas less matched to electrification, especially delivering and parts of market" and offering versatility to the power system. " Stronger signals of intent could guide personal and public investments into those locations which add most value. The federal government has actually not plainly set out how to choose which sectors will take advantage of the initial organized 5GW of production and has instead mainly left this to be determined through pilots and trials.". My lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! For anybody 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 usage cases are similarly most likely to succeed. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. Illustrative hydrogen demand in 2030 (blue) and 2035 (purple). Source: UK hydrogen method. Michael Liebrich of Liebreich Associates has arranged the use of low-carbon hydrogen into a "ladder", with existing applications-- such as the chemicals market-- offered top priority. Juliet Phillips, senior policy consultant and UK hydrogen expert at thinktank E3G tells Carbon Brief the strategy had actually "exposed" the door for uses that "dont add the most value for the environment or economy". She includes:. Responding to the report, energy scientists indicated the "little" volumes of hydrogen anticipated to be produced in the future and advised the federal government to choose its top priorities carefully. The strategy likewise consists of the option of utilizing hydrogen in sectors that may be better served by electrification, especially domestic heating, where hydrogen has to contend with electrical heat pumps.. The brand-new strategy is clear that market will be a "lead option" for early hydrogen use, starting in the mid-2020s. It also states that it will "most likely" be very important for decarbonising transport-- particularly heavy items cars, shipping and air travel-- and stabilizing a more renewables-heavy grid. It consists of strategies for hydrogen heating trials and consultation on "hydrogen-ready" boilers by 2026. Coverage of the report and federal government advertising products stressed that the governments strategy would supply enough hydrogen to replace natural gas in around 3m houses each year. 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 3rd of the size of the existing power sector. Some applications, such as commercial heating, might be virtually impossible without a supply of hydrogen, and many specialists have argued that these are the cases where it should be prioritised, a minimum of in the brief term. The CCC does not see substantial use of hydrogen outside of these limited cases by 2035, as the chart below shows. " As the strategy confesses, there will not be significant quantities of low-carbon hydrogen for a long time. [Therefore] we need to use it where there are couple of options and not as a like-for-like replacement of gas," Dr Jan Rosenow, director of European programs at the Regulatory Assistance Project, in a declaration. Government analysis, consisted of in the technique, recommends prospective hydrogen demand of as much as 38 terawatt-hours (TWh) by 2030, not including blending it into the gas grid, and rising to 55-165TWh by 2035. One noteworthy exemption is hydrogen for fuel-cell automobile. This follows the federal governments concentrate on electric vehicles, which numerous scientists deem more effective and economical technology. Nevertheless, the beginning point for the variety-- 0TWh-- recommends there is substantial unpredictability compared to other sectors, and even the highest quote is just around a 10th of the energy presently utilized to heat UK homes. Although low-carbon hydrogen can be utilized to do everything from sustaining cars to heating homes, the truth is that it will likely be limited by the volume that can probably be produced. Commitments made in the new method include:. The federal government is more optimistic about using hydrogen in domestic heating. Its analysis recommends that approximately 45TWh of low-carbon hydrogen could be put to this use by 2035, as the chart below shows. 4) On page 62 the hydrogen strategy specifies that the federal government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. 1 TWh is 0.2%. Much will depend upon the progress of feasibility research studies in the coming years, and the governments approaching heat and buildings strategy might also supply some clearness. " I would recommend to go with these no-regret options for hydrogen need [in market] that are already offered ... those ought to be the focus.". Finally, in order to produce a market for hydrogen, the government says it will examine blending as much as 20% hydrogen into the gas network by late 2022 and goal to make a 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:. How does the federal government strategy to support the hydrogen market? According to the governments news release, its preferred design is "constructed on a similar premise to the overseas wind agreements for difference (CfDs)", which substantially cut costs of brand-new offshore wind farms. The 10-point strategy included a pledge to establish a hydrogen service design to encourage personal financial investment and a revenue mechanism to provide financing for the organization design. However, Anne-Marie Trevelyan-- minister for energy, tidy growth and environment modification at BEIS-- informed the Times that the expense to offer long-term security to the industry would be "very little" for individual families. Hydrogen need (pink location) and percentage of last energy intake in 2050 (%). My lovelies, I simply dropped Version 4 of the Clean Hydrogen Ladder! Call for proof on phaseout of carbon-intensive hydrogen production in industry "within a year"." As the method confesses, there will not be significant amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method mentions that the federal government expects << 1 TWh of energy for heating to come from hydrogen by 2030. Much of the resulting press protection 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 come from either higher expenses or public funds. Now that its strategy has actually been published, the government says it will gather evidence from assessments on its low-carbon hydrogen requirement, net-zero hydrogen fund and business design:. As it stands, low-carbon hydrogen stays costly compared to nonrenewable fuel source alternatives, there is uncertainty about the level of future demand and high risks for business intending to get in the sector. Sharelines from this story. " This will give us a better understanding of the mix of production innovations, how we will meet a ramp-up in demand, and the role that new technologies might play in attaining the levels of production necessary to satisfy our future [sixth carbon budget] and net-zero commitments.". The new hydrogen technique validates that this company model will be settled in 2022, allowing the first agreements to be designated from the start of 2023. This is pending another consultation, which has been released together with the primary strategy. These contracts are developed to get rid of the cost space between the favored technology and nonrenewable fuel sources. Hydrogen manufacturers would be offered a payment that bridges this gap.