Company decisions around the extent of hydrogen usage in domestic heating and how to guarantee it is produced in a low-carbon way have actually 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 examines a few of the main talking points around the UKs hydrogen strategies.
Specialists have cautioned that, with hydrogen in brief supply in the coming years, the UK needs to prioritise it in “hard-to-electrify” sectors such as heavy market as capacity expands.
Hydrogen will be “crucial” for achieving the UKs net-zero target and could consume to a third of the nations energy by 2050, according to the federal government.
The UKs brand-new, long-awaited hydrogen strategy supplies more detail on how the government will support the development of a domestic low-carbon hydrogen sector, which today is practically non-existent.
Why does the UK require a hydrogen technique?
The technique does not increase this target, although it keeps in mind that the government is “familiar with a possible pipeline of over 15GW of jobs”.
A recent All Party Parliamentary Group report on the function of hydrogen in powering market consisted of a list of demands, specifying that the federal government should “expand beyond its existing dedications of 5GW production in the upcoming hydrogen technique”. This call has been echoed by some industry groups.
However, just like the majority of the federal governments net-zero method files so far, the hydrogen strategy has actually been postponed by months, leading to uncertainty around the future of this fledgling market.
Prior to the brand-new method, the prime ministers 10-point strategy in November 2020 included plans to produce five gigawatts (GW) of annual low-carbon hydrogen production in the UK by 2030. Currently, this capacity stands at virtually no.
Nevertheless, the Climate Change Committee (CCC) has kept in mind that, in order to hit the UKs carbon budget plans and attain net-zero emissions, decisions in areas such as decarbonising heating and automobiles require to be made in the 2020s to allow time for facilities and car stock changes.
The document includes an expedition of how the UK will expand 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.
Nevertheless, as the chart listed below programs, if the federal governments plans come to fulfillment it might then expand considerably– using up in between 20-35% of the countrys total energy supply by 2050. This will need a significant growth of facilities and skills in the UK.
Hydrogen demand (pink area) and percentage of last energy intake in 2050 (%). The central range is based upon illustrative net-zero consistent circumstances in the 6th carbon spending plan effect evaluation and the full variety is based upon the entire variety from hydrogen strategy analytical annex. Source: UK hydrogen strategy.
In its brand-new method, the UK federal government makes it clear that it sees low-carbon hydrogen as a key part of its net-zero strategy, and states it desires the country to be a “worldwide leader on hydrogen” by 2030.
Business such as Equinor are continuing with hydrogen advancements in the UK, however market figures have alerted that the UK dangers being left. Other European nations have actually pledged billions to support low-carbon hydrogen expansion.
There were also over 100 recommendations to hydrogen throughout the governments energy white paper, showing its possible use in numerous sectors. It likewise features in the industrial and transportation decarbonisation strategies launched earlier this year.
Critics likewise characterise hydrogen– the majority of which is currently made from gas– as a method for fossil fuel business to maintain the status quo. (For all the benefits and drawbacks of hydrogen, see Carbon Briefs in-depth explainer.).
Its flexibility implies it can be utilized to tackle emissions in “hard-to-abate” sectors, such as heavy market, however it currently suffers from high rates and low performance..
The plan also 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 decrease reliance on gas.
Hydrogen development for the next years is expected to start gradually, with a federal government aspiration to “see 1GW production capability by 2025” laid out in the technique.
Today we have published the UKs very first Hydrogen Strategy! This is our strategy to: kick-start an entire industry release the market to cut expenses increase domestic production unlock ₤ 4bn of personal capital assistance 9k jobs #BuildBackGreenerhttps:// t.co/ aHZTr5yYeR– Kwasi Kwarteng (@KwasiKwarteng) August 17, 2021.
In some applications, hydrogen will contend with electrification and carbon capture and storage (CCS) as the best methods of decarbonisation.
Hydrogen is widely viewed as a crucial part in plans to attain net-zero emissions and has been the topic of significant buzz, with numerous nations prioritising it in their post-Covid green recovery strategies.
What variety of low-carbon hydrogen will be prioritised?
CO2 equivalent: Greenhouse gases can be expressed in terms of carbon dioxide equivalent, or CO2eq. For an offered amount, different greenhouse gases trap various quantities of heat in the atmosphere, a quantity understood as the global warming potential. Carbon dioxide equivalent is a way of comparing emissions from all greenhouse gases, not just carbon dioxide.
Supporting a range of jobs will give the UK a “competitive advantage”, according to the government. Germany, by contrast, has stated it will focus specifically on green hydrogen.
Comparison of cost quotes across different innovation types at main fuel costs commissioning from 2020 to 2050, ₤/ MWh hydrogen. Source: Hydrogen Production Costs.
The CCC has formerly stated that the federal government ought to “set out [a] vision for contributions of hydrogen production from various paths to 2035” in its hydrogen technique.
This opposition capped when a recent study caused headlines stating that blue hydrogen is “even worse for the climate than coal”.
CO2 equivalent: Greenhouse gases can be expressed in regards to carbon dioxide equivalent, or CO2eq. For a provided quantity, different greenhouse gases trap various quantities of heat in the environment, a quantity understood as … Read More.
The plan keeps in mind that, sometimes, hydrogen made using electrolysers “could become cost-competitive with CCUS [carbon capture, storage and utilisation] -allowed methane reformation as early as 2025”..
The new method mostly prevents utilizing this colour-coding system, however it says the government has actually devoted to a “twin track” technique that will consist of the production of both varieties.
It has likewise released an accompanying report, prepared by consultancies E4Tech and Ludwig-Bölkow-Systemtechnik (LBST), which examines optimum acceptable levels of emissions for low-carbon hydrogen production and the approach for computing these emissions.
The figure below from the consultation, based on this analysis, reveals the impact of setting a threshold of 15-20gCO2e per megajoule (MJ) of hydrogen (red bar). In this example, those production approaches above the red line, consisting of some for producing blue hydrogen, would be excluded.
The federal government has actually launched a consultation on low-carbon hydrogen requirements to accompany the method, with a pledge to “finalise style elements” of such standards by early 2022.
At the heart of many conversations about low-carbon hydrogen production is whether the hydrogen is “green” or “blue”.
” If we wish to show, trial, begin to commercialise and then present making use of hydrogen in industry/air travel/freight or any place, then we need enough hydrogen. We cant wait up until the supply side deliberations are complete.”.
However, there was substantial pushback on this conclusion, with other researchers– including CCC head of carbon spending plans, David Joffe– mentioning that it depended on very high methane leak and a short-term step of international warming capacity that emphasised the effect of methane emissions over CO2.
Quick (hopefully) reflecting on this blue hydrogen thing. And then cherry-picked an environment metric to make it look as bad as possible.
Green hydrogen is made using electrolysers powered by renewable electrical energy, while blue hydrogen is used natural gas, with the resulting emissions recorded and saved..
The CCC has cautioned that policies should establish both green and blue options, “rather than simply whichever is least-cost”.
For its part, the CCC has actually advised a “blue hydrogen bridge” as an useful tool for accomplishing net-zero. It states enabling some blue hydrogen will reduce emissions much faster in the short-term by replacing more nonrenewable fuel sources with hydrogen when there is insufficient green hydrogen offered..
The technique mentions that the proportion of hydrogen provided by particular innovations “depends upon a series of assumptions, which can just be tested through the markets reaction to the policies set out in this technique and real, at-scale release of hydrogen”..
The chart below, from a file outlining hydrogen expenses launched together with the primary method, reveals the expected decreasing cost of electrolytic hydrogen over time (green lines). (This includes hydrogen made using grid electrical power, which is not technically green unless the grid is 100% eco-friendly.).
The previous is essentially zero-carbon, however the latter can still lead to emissions due to methane leakages from natural gas facilities and the reality that carbon capture and storage (CCS) does not catch 100% of emissions..
Prof Robert Gross, director of the UK Energy Research Centre, tells Carbon Brief that, in his view, it is “most likely a bit unhelpful to get too preoccupied with the green vs blue hydrogen debate”. He says:.
As it stands, blue hydrogen made using steam methane reformation (SMR) is the most inexpensive low-carbon hydrogen readily available, according to government analysis consisted of in the technique. (For more on the relative expenses of various hydrogen ranges, see this Carbon Brief explainer.).
In the example picked for the assessment, natural gas routes where CO2 capture rates are below around 85% were left out..
The CCC has previously defined “suitable emissions reductions” for blue hydrogen compared to fossil gas as “a minimum of 95% CO2 capture, 85% lifecycle greenhouse gas savings”.
Environmental groups and numerous scientists are sceptical about blue hydrogen given its associated emissions.
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 “consider carbon intensity as the main factor in market advancement”.
The document does not do that and instead says it will provide “more information on our production method and twin track method by early 2022”.
Jess Ralston, an expert at thinktank the Energy and Climate Intelligence Unit (ECIU), stated in a declaration that the federal government should “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”.
How will hydrogen be used in different sectors of the economy?
The new method is clear that market will be a “lead option” for early hydrogen use, beginning in the mid-2020s. It likewise says that it will “most likely” be crucial for decarbonising transportation– especially heavy products automobiles, shipping and aviation– and balancing a more renewables-heavy grid.
Federal government analysis, included in the strategy, recommends potential hydrogen demand of as much as 38 terawatt-hours (TWh) by 2030, not including mixing it into the gas grid, and rising to 55-165TWh by 2035.
Call for evidence on “hydrogen-ready” commercial equipment by the end of 2021. Call for 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.
One notable exclusion is hydrogen for fuel-cell automobile. This follows the governments focus on electric vehicles, which many scientists consider as more efficient and cost-efficient innovation.
Although low-carbon hydrogen can be used to do everything from fuelling automobiles to heating homes, the truth is that it will likely be limited by the volume that can probably be produced.
This is in line with the CCCs suggestion for its net-zero path, which sees low-carbon hydrogen scaling up to 90TWh by 2035– around a third of the size of the existing power sector.
Protection of the report and government promotional products stressed that the federal governments strategy would supply enough hydrogen to change natural gas in around 3m houses each year.
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 usage cases for tidy 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.
It contains plans for hydrogen heating trials and consultation on “hydrogen-ready” boilers by 2026.
Juliet Phillips, senior policy consultant and UK hydrogen expert at thinktank E3G tells Carbon Brief the strategy had “left open” the door for uses that “do not include the most worth for the environment or economy”. She includes:.
Nevertheless, the technique also includes the choice of using hydrogen in sectors that may be much better served by electrification, particularly domestic heating, where hydrogen has to take on electric heatpump..
” Stronger signals of intent might steer public and private investments into those locations which add most value. The federal government has not clearly set out how to choose upon which sectors will gain from the preliminary scheduled 5GW of production and has rather largely left this to be determined through trials and pilots.”.
Reacting to the report, energy researchers pointed to the “little” volumes of hydrogen expected to be produced in the future and prompted the government to select its concerns thoroughly.
The CCC does not see comprehensive use of hydrogen outside of these minimal cases by 2035, as the chart listed below programs.
Dedications made in the brand-new technique consist of:.
The government is more positive about the use of hydrogen in domestic heating. Its analysis recommends that up to 45TWh of low-carbon hydrogen could be put to this usage by 2035, as the chart below indicates.
Nevertheless, in the real report, the federal government said that it expected “in general the demand for low carbon hydrogen for heating by 2030 to be fairly low (<< 1TWh)".. " As the method confesses, there will not be substantial quantities of low-carbon hydrogen for a long time.  we require to use it where there are couple of alternatives 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. Some applications, such as industrial heating, might be virtually difficult without a supply of hydrogen, and numerous experts have argued that these hold true where it must be prioritised, at least in the brief term. The committee stresses that hydrogen use need to be limited to "locations less suited to electrification, especially delivering and parts of industry" and offering versatility to the power system. Illustrative hydrogen need in 2030 (blue) and 2035 (purple). Source: UK hydrogen strategy. Michael Liebrich of Liebreich Associates has organised using low-carbon hydrogen into a "ladder", with present applications-- such as the chemicals market-- given leading concern. The beginning point for the variety-- 0TWh-- suggests there is substantial uncertainty compared to other sectors, and even the highest quote is only around a 10th of the energy presently utilized to heat UK houses. 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%. " I would suggest to choose these no-regret options for hydrogen demand [in industry] that are currently readily available ... those ought to be the focus.". Gniewomir Flis, a task supervisor at Agora Energiewende, tells Carbon Brief that-- in his view-- blending "has no future". He describes:. Much will hinge on the progress of feasibility studies in the coming years, and the governments upcoming heat and structures strategy may also supply some clearness. Lastly, in order to produce a market for hydrogen, the federal government states it will analyze blending approximately 20% hydrogen into the gas network by late 2022 and aim to make a final choice in late 2023. How does the federal government strategy to support the hydrogen industry? Much of the resulting press protection of the hydrogen method, from the Financial Times to the Daily Telegraph, concentrated on the strategy for a hydrogen market "subsidised by taxpayers", as the cash would come from either greater costs or public funds. Sharelines from this story. According to the governments press release, its preferred model is "constructed on a comparable premise to the overseas wind agreements for distinction (CfDs)", which considerably cut expenses of new offshore wind farms. Hydrogen need (pink area) and proportion of final energy usage in 2050 (%). My lovelies, I just 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 significant quantities of low-carbon hydrogen for some time. 4) On page 62 the hydrogen method mentions that the government anticipates << 1 TWh of energy for heating to come from hydrogen by 2030. The 10-point strategy consisted of a pledge to establish a hydrogen organization design to encourage private investment and a profits system to offer funding for business design. Anne-Marie Trevelyan-- minister for energy, tidy growth and environment change at BEIS-- informed the Times that the cost to provide long-term security to the market would be "extremely little" for specific homes. Now that its strategy has been published, the federal government states it will gather evidence from consultations on its low-carbon hydrogen requirement, net-zero hydrogen fund and business model:. The new hydrogen strategy confirms that this business design will be settled in 2022, allowing the first contracts to be designated from the start of 2023. This is pending another consultation, which has actually been launched along with the main strategy. These contracts are designed to get rid of the cost space between the preferred technology and nonrenewable fuel sources. Hydrogen producers would be given a payment that bridges this space. " This will provide us a better understanding of the mix of production innovations, how we will meet a ramp-up in need, and the function that new innovations could play in attaining the levels of production needed to satisfy our future [sixth carbon spending plan] and net-zero commitments.". As it stands, low-carbon hydrogen remains pricey compared to nonrenewable fuel source options, there is uncertainty about the level of future demand and high threats for companies intending to enter the sector.