In-depth Q&A: How will the UK’s hydrogen strategy help achieve net-zero?
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Specialists 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 industry as capability expands.
Hydrogen will be “important” for attaining the UKs net-zero target and could use up to a 3rd of the countrys energy by 2050, according to the federal government.
In this post, Carbon Brief highlights key points from the 121-page method and analyzes some of the primary talking points around the UKs hydrogen plans.
Firm decisions around the degree of hydrogen usage in domestic heating and how to ensure it is produced in a low-carbon way have actually been postponed or put out to consultation for the time being.
Why does the UK need a hydrogen method?
Companies such as Equinor are pushing on with hydrogen developments in the UK, however market figures have alerted that the UK risks being left. Other European countries have actually vowed billions to support low-carbon hydrogen growth.
Nevertheless, just like the majority of the federal governments net-zero strategy files so far, the hydrogen plan has been delayed by months, resulting in uncertainty around the future of this new industry.
Hydrogen demand (pink location) and percentage of last energy intake in 2050 (%). The central variety is based on illustrative net-zero consistent circumstances in the 6th carbon budget impact assessment and the complete range is based on the entire range from hydrogen strategy analytical annex. Source: UK hydrogen strategy.
Hydrogen development for the next years is expected to start slowly, with a federal government aspiration to “see 1GW production capacity by 2025” laid out in the method.
There were also over 100 references to hydrogen throughout the governments energy white paper, showing its potential use in numerous sectors. It also features in the industrial and transport decarbonisation strategies launched previously this year.
The strategy likewise called for a ₤ 240m net-zero hydrogen fund, the creation of a hydrogen neighbourhood heated up with the gas by 2023, and increasing hydrogen blending into gas networks to 20% to minimize reliance on gas.
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 says it wants the nation to be a “worldwide leader on hydrogen” by 2030.
Its flexibility implies it can be used to take on emissions in “hard-to-abate” sectors, such as heavy market, however it currently experiences high prices and low efficiency..
Today we have published the UKs first Hydrogen Strategy! This is our strategy to: kick-start an entire industry let loose the market to cut costs ramp up domestic production unlock ₤ 4bn of personal capital assistance 9k tasks #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
As the chart below programs, if the governments plans come to fulfillment it could then expand considerably– taking up between 20-35% of the countrys total energy supply by 2050. This will need a major expansion of facilities and abilities in the UK.
Hydrogen is widely seen as an essential component in plans to accomplish net-zero emissions and has been the topic of significant hype, with many countries prioritising it in their post-Covid green recovery plans.
A recent All Party Parliamentary Group report on the role of hydrogen in powering industry included a list of demands, stating that the federal government should “broaden beyond its existing dedications of 5GW production in the forthcoming hydrogen method”. This call has been echoed by some market groups.
Critics likewise characterise hydrogen– many of which is currently made from natural gas– as a way for fossil fuel companies to maintain the status quo. (For all the advantages and drawbacks of hydrogen, see Carbon Briefs extensive explainer.).
Prior to the brand-new method, the prime ministers 10-point strategy in November 2020 consisted of strategies to produce five gigawatts (GW) of yearly low-carbon hydrogen production in the UK by 2030. Presently, this capability stands at practically zero.
However, the Climate Change Committee (CCC) has kept in mind that, in order to hit the UKs carbon spending plans and accomplish net-zero emissions, decisions in areas such as decarbonising heating and cars require to be made in the 2020s to allow time for facilities and vehicle stock changes.
In some applications, hydrogen will take on electrification and carbon capture and storage (CCS) as the very best ways of decarbonisation.
The method does not increase this target, although it notes that the government is “knowledgeable about a possible pipeline of over 15GW of projects”.
The file consists of an expedition of how the UK will expand production and create a market for hydrogen based on domestic supply chains. This contrasts with Germany, which has been wanting to import hydrogen from abroad.
What range of low-carbon hydrogen will be prioritised?
This opposition capped when a recent study led to headings mentioning that blue hydrogen is “worse for the climate than coal”.
The figure below from the consultation, based on this analysis, shows the impact of setting a threshold of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production methods above the red line, including some for producing blue hydrogen, would be excluded.
In the example selected for the consultation, natural gas paths where CO2 capture rates are below around 85% were omitted..
The previous is essentially zero-carbon, however the latter can still lead to emissions due to methane leaks from gas facilities and the fact that carbon capture and storage (CCS) does not record 100% of emissions..
The CCC has warned that policies must establish both blue and green options, “instead of just whichever is least-cost”.
The brand-new strategy mostly prevents utilizing this colour-coding system, however it says the government has actually devoted to a “twin track” method that will consist of the production of both varieties.
Nevertheless, there was considerable pushback on this conclusion, with other scientists– including CCC head of carbon budget plans, David Joffe– mentioning that it relied on really high methane leak and a short-term step of global warming capacity that stressed the effect of methane emissions over CO2.
The federal government has actually released a consultation on low-carbon hydrogen requirements to accompany the technique, with a pledge to “finalise design aspects” of such standards by early 2022.
Green hydrogen is used electrolysers powered by eco-friendly electrical energy, while blue hydrogen is used gas, with the resulting emissions caught and stored..
” If we desire to demonstrate, trial, begin to commercialise and then present making use of hydrogen in industry/air travel/freight or any place, then we require enough hydrogen. We cant wait until the supply side deliberations are complete.”.
It has actually likewise released 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 calculating these emissions.
Short (hopefully) reflecting on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
The CCC has formerly defined “appropriate emissions reductions” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
The CCC has previously stated that the government must “set out [a] vision for contributions of hydrogen production from different routes to 2035” in its hydrogen technique.
For its part, the CCC has advised a “blue hydrogen bridge” as an useful tool for achieving net-zero. It states allowing some blue hydrogen will lower emissions quicker in the short-term by replacing more nonrenewable fuel sources with hydrogen when there is insufficient green hydrogen available..
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 argument”. He says:.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a statement that the federal government should “be alive to the danger of gas industry lobbying causing it to devote too greatly to blue hydrogen therefore keeping the nation locked into fossil fuel-based technology”.
Supporting a variety of jobs will provide the UK a “competitive benefit”, according to the government. Germany, by contrast, has said it will focus solely 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, instead of “blue” or “green”, the UK would “consider carbon strength as the main element in market advancement”.
Many researchers and environmental groups are sceptical about blue hydrogen provided its associated emissions.
Contrast of cost estimates throughout various innovation types at central fuel prices commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
2021.
CO2 equivalent: Greenhouse gases can be revealed in regards to co2 equivalent, or CO2eq. For an offered quantity, various greenhouse gases trap different amounts of heat in the environment, an amount known as the worldwide warming potential. Co2 equivalent is a way of comparing emissions from all greenhouse gases, not just co2.
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CO2 equivalent: Greenhouse gases can be expressed in regards to carbon dioxide equivalent, or CO2eq. For a provided amount, different greenhouse gases trap different amounts of heat in the atmosphere, a quantity referred to as … Read More.
The strategy keeps in mind that, in some cases, hydrogen made using electrolysers “could become cost-competitive with CCUS [carbon utilisation, capture and storage] -made it possible for methane reformation as early as 2025”..
As it stands, blue hydrogen made utilizing steam methane reformation (SMR) is the most inexpensive low-carbon hydrogen readily available, according to federal government analysis included in the technique. (For more on the relative expenses of various hydrogen varieties, see this Carbon Brief explainer.).
The strategy specifies that the percentage of hydrogen provided by particular innovations “depends on a variety of assumptions, which can only be checked through the marketplaces response to the policies set out in this method and real, at-scale release of hydrogen”..
The document does refrain from doing that and instead states it will provide “additional detail on our production method and twin track approach by early 2022”.
Glossary.
At the heart of lots of discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
The chart below, from a document detailing hydrogen costs released alongside the main technique, shows the anticipated decreasing cost of electrolytic hydrogen gradually (green lines). (This includes hydrogen used grid electricity, which is not technically green unless the grid is 100% eco-friendly.).
How will hydrogen be used in various sectors of the economy?
” As the method admits, there will not be considerable amounts of low-carbon hydrogen for some time.
The federal government is more optimistic about making use of hydrogen in domestic heating. Its analysis suggests that up to 45TWh of low-carbon hydrogen could be put to this use by 2035, as the chart below indicates.
One notable exclusion is hydrogen for fuel-cell passenger vehicles. This is constant with the governments concentrate on electric vehicles, which lots of scientists consider as more efficient and cost-effective technology.
Dedications made in the brand-new method include:.
Michael Liebrich of Liebreich Associates has arranged making use of low-carbon hydrogen into a “ladder”, with existing applications– such as the chemicals industry– provided top concern.
It consists of plans for hydrogen heating trials and assessment on “hydrogen-ready” boilers by 2026.
Reacting to the report, energy researchers indicated the “small” volumes of hydrogen expected to be produced in the near future and prompted the government to choose its top priorities thoroughly.
Government analysis, included in the strategy, recommends potential hydrogen need of up to 38 terawatt-hours (TWh) by 2030, not including mixing it into the gas grid, and increasing to 55-165TWh by 2035.
In the actual report, the government stated that it anticipated “in general the demand for low carbon hydrogen for heating by 2030 to be relatively low (<< 1TWh)".. The CCC does not see comprehensive usage of hydrogen beyond these minimal cases by 2035, as the chart listed below shows. My lovelies, I just 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, due to the fact that not all usage cases are equally likely to prosper. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. The technique also consists of the choice of utilizing hydrogen in sectors that might be better served by electrification, particularly domestic heating, where hydrogen has to contend with electric heat pumps.. Although low-carbon hydrogen can be used to do everything from sustaining cars to heating houses, the truth is that it will likely be restricted by the volume that can probably be produced. Coverage of the report and government promotional materials emphasised that the governments plan would provide sufficient hydrogen to replace gas in around 3m houses each year. However, the beginning point for the range-- 0TWh-- recommends there is considerable uncertainty compared to other sectors, and even the highest estimate is just around a 10th of the energy currently utilized to heat UK houses. Juliet Phillips, senior policy consultant and UK hydrogen specialist at thinktank E3G tells Carbon Brief the strategy had actually "left open" the door for usages that "do not add the most worth for the climate or economy". She includes:. Some applications, such as industrial heating, may be essentially impossible without a supply of hydrogen, and numerous experts have argued that these are the cases where it need to be prioritised, a minimum of in the short-term. The committee emphasises that hydrogen usage need to be restricted to "locations less suited to electrification, especially shipping and parts of industry" and providing versatility to the power system. The new strategy is clear that market will be a "lead alternative" for early hydrogen use, starting in the mid-2020s. It also states that it will "most likely" be essential for decarbonising transport-- particularly heavy products lorries, shipping and air travel-- and balancing a more renewables-heavy grid. This remains in line with the CCCs recommendation 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. Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen technique. " Stronger signals of intent could guide private and public investments into those areas which add most value. The government has actually not clearly set out how to pick which sectors will gain from the initial scheduled 5GW of production and has rather mostly left this to be figured out through pilots and trials.". Require evidence 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 competitors in 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. Existing energy demand in the UK for space and hot water heating is 435 TWh according to Ofgem. 1 TWh is 0.2%. Thats about 67,000 houses.-- Jan Rosenow (@janrosenow) August 17, 2021. Much will depend upon the progress of feasibility studies in the coming years, and the federal governments approaching heat and structures method might also offer some clearness. Finally, in order to produce a market for hydrogen, the federal government says it will take a look at mixing up to 20% hydrogen into the gas network by late 2022 and aim to make a decision in late 2023. " I would suggest to go with these no-regret alternatives for hydrogen demand [in market] that are already readily available ... those need to be the focus.". Gniewomir Flis, a project manager at Agora Energiewende, informs Carbon Brief that-- in his view-- blending "has no future". He describes:. How does the government plan to support the hydrogen industry? Sharelines from this story. The brand-new hydrogen method validates that this business model will be finalised in 2022, allowing the first contracts to be allocated from the start of 2023. This is pending another assessment, which has been introduced along with the main technique. " This will provide us a better understanding of the mix of production innovations, how we will satisfy a ramp-up in need, and the function that new innovations might play in achieving the levels of production needed to satisfy our future [6th carbon budget] and net-zero dedications.". Hydrogen demand (pink location) and percentage of final energy consumption 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 technique admits, there wont be substantial quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method specifies that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. These agreements are designed to overcome the expense gap in between the favored technology and fossil fuels. Hydrogen manufacturers would be provided a payment that bridges this gap. Now that its strategy has actually been released, the government says it will gather evidence from assessments on its low-carbon hydrogen requirement, net-zero hydrogen fund and business design:. Much of the resulting press protection 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 money would come from either greater bills or public funds. According to the federal governments press release, its preferred design is "constructed on a similar property to the offshore wind agreements for difference (CfDs)", which considerably cut expenses of new offshore wind farms. Nevertheless, Anne-Marie Trevelyan-- minister for energy, tidy development and climate modification at BEIS-- informed the Times that the cost to offer long-term security to the market would be "really little" for private households. The 10-point strategy consisted of a pledge to establish a hydrogen organization design to encourage private financial investment and an income system to provide financing for the organization design. As it stands, low-carbon hydrogen remains pricey compared to fossil fuel alternatives, there is unpredictability about the level of future need and high dangers for business intending to enter the sector.