Firm 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 consultation for the time being.
Hydrogen will be “crucial” for achieving the UKs net-zero target and might utilize up to a 3rd of the countrys energy by 2050, according to the government.
In this article, Carbon Brief highlights crucial points from the 121-page strategy and examines some of the main talking points around the UKs hydrogen strategies.
Professionals have actually warned that, with hydrogen in brief supply in the coming years, the UK must prioritise it in “hard-to-electrify” sectors such as heavy industry as capability expands.
The UKs new, long-awaited hydrogen method supplies 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 need a hydrogen strategy?
Hydrogen is widely viewed as a vital element in strategies to achieve net-zero emissions and has actually been the topic of considerable buzz, with numerous nations prioritising it in their post-Covid green recovery strategies.
Hydrogen demand (pink area) and proportion of final energy consumption in 2050 (%). The main range is based on illustrative net-zero consistent scenarios in the sixth carbon budget plan impact evaluation and the complete range is based upon the entire range from hydrogen method analytical annex. Source: UK hydrogen strategy.
However, as the chart below shows, if the governments plans come to fruition it could then broaden substantially– using up in between 20-35% of the nations total energy supply by 2050. This will require a major growth of infrastructure and skills in the UK.
In some applications, hydrogen will take on electrification and carbon capture and storage (CCS) as the very best methods of decarbonisation.
A current All Party Parliamentary Group report on the function of hydrogen in powering industry consisted of a list of needs, mentioning that the federal government needs to “broaden beyond its existing commitments of 5GW production in the forthcoming hydrogen method”. This call has been echoed by some market groups.
Today we have actually released the UKs first Hydrogen Strategy! This is our strategy to: kick-start an entire industry let loose the market to cut expenses increase domestic production unlock ₤ 4bn of private capital support 9k jobs #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
The Climate Change Committee (CCC) has actually kept in mind that, in order to strike the UKs carbon budget 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 lorry stock modifications.
The plan likewise called for a ₤ 240m net-zero hydrogen fund, the development of a hydrogen neighbourhood heated up with the gas by 2023, and increasing hydrogen mixing into gas networks to 20% to minimize reliance on natural gas.
In its new technique, the UK federal government makes it clear that it sees low-carbon hydrogen as a crucial part of its net-zero plan, and states it desires the nation to be a “worldwide leader on hydrogen” by 2030.
Prior to the brand-new technique, the prime ministers 10-point plan in November 2020 consisted of strategies to produce 5 gigawatts (GW) of annual low-carbon hydrogen production in the UK by 2030. Presently, this capability stands at virtually zero.
Business such as Equinor are continuing with hydrogen advancements in the UK, but market figures have actually alerted that the UK risks being left behind. Other European countries have actually promised billions to support low-carbon hydrogen expansion.
Critics likewise characterise hydrogen– the majority of which is presently 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.).
Hydrogen development for the next years is anticipated to begin gradually, with a government goal to “see 1GW production capacity by 2025” set out in the method.
The technique does not increase this target, although it notes that the federal government is “familiar with a prospective pipeline of over 15GW of projects”.
There were likewise over 100 referrals to hydrogen throughout the federal governments energy white paper, reflecting its prospective use in many sectors. It likewise features in the industrial and transport decarbonisation techniques released earlier this year.
As with many of the federal governments net-zero technique files so far, the hydrogen strategy has actually been postponed by months, resulting in uncertainty around the future of this recently established industry.
Its adaptability implies it can be utilized to tackle emissions in “hard-to-abate” sectors, such as heavy industry, however it currently suffers from high costs and low efficiency..
The document consists of 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 actually been wanting to import hydrogen from abroad.
What variety of low-carbon hydrogen will be prioritised?
” If we want to demonstrate, trial, start to commercialise and then present the usage of hydrogen in industry/air travel/freight or anywhere, then we require enough hydrogen. We cant wait until the supply side deliberations are complete.”.
As it stands, blue hydrogen used steam methane reformation (SMR) is the cheapest low-carbon hydrogen offered, according to federal government analysis consisted of in the technique. (For more on the relative costs of different hydrogen varieties, see this Carbon Brief explainer.).
The plan notes that, sometimes, hydrogen used electrolysers “might end up being cost-competitive with CCUS [carbon utilisation, capture and storage] -allowed methane reformation as early as 2025”..
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 environment, an amount understood as … Read More.
CO2 equivalent: Greenhouse gases can be revealed in terms of carbon dioxide equivalent, or CO2eq. For a provided quantity, various greenhouse gases trap various amounts of heat in the environment, a quantity called the global warming capacity. Carbon dioxide equivalent is a method of comparing emissions from all greenhouse gases, not just carbon dioxide.
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 “consider carbon strength as the main factor in market advancement”.
The previous is essentially zero-carbon, however the latter can still result in emissions due to methane leakages from natural gas facilities and the truth that carbon capture and storage (CCS) does not catch 100% of emissions..
Environmental groups and numerous researchers are sceptical about blue hydrogen provided its associated emissions.
The federal government has launched an assessment on low-carbon hydrogen standards to accompany the strategy, with a promise to “finalise style aspects” of such requirements by early 2022.
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 green vs blue hydrogen dispute”. He states:.
For its part, the CCC has actually advised a “blue hydrogen bridge” as an useful tool for attaining net-zero. It says enabling some blue hydrogen will decrease emissions quicker in the short-term by changing more fossil fuels with hydrogen when there is not enough green hydrogen available..
The CCC has formerly specified “ideal emissions decreases” for blue hydrogen compared to fossil gas as “at least 95% CO2 capture, 85% lifecycle greenhouse gas cost savings”.
The figure below from the consultation, based on this analysis, shows the impact of setting a limit of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production techniques above the red line, consisting of some for producing blue hydrogen, would be omitted.
This opposition came to a head when a recent study resulted in headlines stating that blue hydrogen is “even worse for the climate than coal”.
The CCC has actually formerly stated that the government should “set out [a] vision for contributions of hydrogen production from different paths to 2035” in its hydrogen technique.
The file does not do that and rather states it will offer “more information on our production method and twin track technique by early 2022”.
The chart below, from a document detailing hydrogen costs launched along with the primary strategy, shows the anticipated decreasing expense of electrolytic hydrogen over time (green lines). (This includes hydrogen made utilizing grid electrical energy, which is not technically green unless the grid is 100% sustainable.).
Green hydrogen is used electrolysers powered by renewable electrical power, while blue hydrogen is made utilizing natural gas, with the resulting emissions caught and stored..
There was substantial pushback on this conclusion, with other researchers– including CCC head of carbon budget plans, David Joffe– pointing out that it relied on really high methane leak and a short-term measure of global warming capacity that stressed the effect of methane emissions over CO2.
In the example chosen for the consultation, natural gas routes where CO2 capture rates are below around 85% were omitted..
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 reaction to the policies set out in this method and real, at-scale release of hydrogen”..
It has likewise released 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 computing these emissions.
The new method mostly prevents using this colour-coding system, however it says the government has committed to a “twin track” approach that will include the production of both ranges.
Short (ideally) showing on this blue hydrogen thing. And then cherry-picked a climate metric to make it look as bad as possible.
Comparison of price estimates across different technology types at central fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
At the heart of many discussions about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
Supporting a variety of projects will provide the UK a “competitive advantage”, according to the federal government. Germany, by contrast, has said it will focus solely on green hydrogen.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a declaration that the federal government need to “live to the danger of gas market lobbying triggering it to dedicate too greatly to blue hydrogen and so keeping the country locked into fossil fuel-based technology”.
The CCC has actually warned that policies need to establish both green and blue options, “instead of just whichever is least-cost”.
How will hydrogen be used in different sectors of the economy?
Some applications, such as commercial heating, might be practically impossible without a supply of hydrogen, and many experts have actually argued that these hold true where it must be prioritised, a minimum of in the brief term.
The committee stresses that hydrogen use must be restricted to “areas less fit to electrification, particularly delivering and parts of industry” and supplying versatility to the power system.
” Stronger signals of intent could steer public and personal investments into those areas which include most value. The federal government has not plainly set out how to choose which sectors will take advantage of the initial scheduled 5GW of production and has rather largely left this to be figured out through trials and pilots.”.
However, the beginning point for the range– 0TWh– suggests there is significant unpredictability compared to other sectors, and even the highest price quote is just around a 10th of the energy presently used to heat UK homes.
However, in the real report, the government stated that it anticipated “overall the demand for low carbon hydrogen for heating by 2030 to be fairly low (<< 1TWh)".. Michael Liebrich of Liebreich Associates has organised using low-carbon hydrogen into a "ladder", with current applications-- such as the chemicals market-- given top concern. Juliet Phillips, senior policy consultant and UK hydrogen expert at thinktank E3G tells Carbon Brief the strategy had actually "exposed" the door for usages that "dont include the most worth for the environment or economy". She includes:. Commitments made in the brand-new technique consist of:. Reacting to the report, energy scientists indicated the "small" volumes of hydrogen expected to be produced in the future and advised the government to pick its priorities thoroughly. Federal government analysis, consisted of in the method, recommends possible hydrogen need of approximately 38 terawatt-hours (TWh) by 2030, not consisting of mixing it into the gas grid, and increasing to 55-165TWh by 2035. Call for proof on "hydrogen-ready" commercial equipment by the end of 2021. Call for proof 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. So, my lovelies, I just dropped Version 4 of the Clean Hydrogen Ladder! For anyone new to all this, the ladder is my effort to put usage cases for clean hydrogen into some sort of benefit order, since not all usage cases are equally likely to be successful. 1/10 pic.twitter.com/I8HpqQjlKS— Michael Liebreich (@MLiebreich) August 15, 2021. The government is more positive about the usage of 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 listed below indicates. Although low-carbon hydrogen can be used to do whatever from fuelling cars and trucks to heating houses, the truth is that it will likely be limited by the volume that can feasibly be produced. One notable exclusion is hydrogen for fuel-cell passenger cars. This follows the federal governments concentrate on electric cars, which many scientists see as more affordable and effective technology. " As the method confesses, there wont be substantial quantities of low-carbon hydrogen for some time. It contains plans for hydrogen heating trials and assessment on "hydrogen-ready" boilers by 2026. Coverage of the report and government promotional products stressed that the federal governments strategy would offer sufficient hydrogen to change gas in around 3m homes each year. Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen technique. The technique also consists of the choice of utilizing hydrogen in sectors that may be much better served by electrification, particularly domestic heating, where hydrogen has to complete with electric heat pumps.. The brand-new technique is clear that industry will be a "lead choice" for early hydrogen usage, beginning in the mid-2020s. It likewise says that it will "likely" be essential for decarbonising transport-- particularly heavy goods lorries, shipping and aviation-- and balancing a more renewables-heavy grid. This remains in line with the CCCs suggestion for its net-zero path, which sees low-carbon hydrogen scaling as much as 90TWh by 2035-- around a third of the size of the present power sector. The CCC does not see comprehensive use of hydrogen outside of these minimal cases by 2035, as the chart below shows. 4) On page 62 the hydrogen strategy states that the federal government expects << 1 TWh of energy for heating to come from hydrogen by 2030. Present energy demand in the UK for space and hot water heating is 435 TWh according to Ofgem. So 1 TWh is 0.2%. Thats about 67,000 homes.-- Jan Rosenow (@janrosenow) August 17, 2021. Finally, in order to create 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 decision in late 2023. " I would recommend to opt for these no-regret alternatives for hydrogen need [in market] that are already readily available ... those must be the focus.". Gniewomir Flis, a project supervisor at Agora Energiewende, tells Carbon Brief that-- in his view-- mixing "has no future". He discusses:. Much will hinge on the development of expediency studies in the coming years, and the governments upcoming heat and buildings technique may likewise supply some clarity. How does the federal government strategy to support the hydrogen market? The new hydrogen strategy verifies that this service design will be settled in 2022, allowing the very first contracts to be assigned from the start of 2023. This is pending another consultation, which has actually been launched together with the main technique. Hydrogen need (pink area) and proportion of last energy usage 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 technique confesses, there wont be significant amounts of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method mentions that the government expects << 1 TWh of energy for heating to come from hydrogen by 2030. Much of the resulting press coverage of the hydrogen method, from the Financial Times to the Daily Telegraph, focused on the strategy for a hydrogen market "subsidised by taxpayers", as the cash would originate from either greater expenses or public funds. Sharelines from this story. Anne-Marie Trevelyan-- minister for energy, tidy growth and environment change at BEIS-- informed the Times that the expense to provide long-term security to the industry would be "extremely small" for specific households. Now that its strategy has been published, the government says it will gather evidence from consultations on its low-carbon hydrogen standard, net-zero hydrogen fund and business design:. According to the governments news release, its favored design is "developed on a similar premise to the offshore wind contracts for difference (CfDs)", which considerably cut expenses of brand-new overseas wind farms. These agreements are designed to overcome the cost space between the preferred innovation and fossil fuels. Hydrogen manufacturers would be offered a payment that bridges this gap. " This will offer 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 accomplishing the levels of production required to satisfy our future [sixth carbon budget] and net-zero commitments.". The 10-point plan consisted of a pledge to develop a hydrogen company model to motivate private financial investment and a revenue system to provide funding for the business model. As it stands, low-carbon hydrogen remains costly compared to nonrenewable fuel source options, there is uncertainty about the level of future need and high risks for companies intending to go into the sector.