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UK government unveils roadmap for hydrogen supply

UK government unveils roadmap for hydrogen supply

The UK government has unveiled its plan today (17th August) to achieve its goal of 5 GW of low-carbon hydrogen production by 2030, the equivalent to substitute natural gas in powering around three million homes and other end-users, particularly heavy industry.

The UK hydrogen economy strategy is expected to create 9,000 jobs in the UK and unlocks £4 billion in investment by 2030. The report also anticipates that the UK hydrogen economy will reach £ 900 million by 2030, which can further reach £13 billion by 2050.

The government ascertains that 20-35% of the UK’s energy consumption can be based on hydrogen by 2050. Consequently, adding hydrogen to the energy portfolio would be critical for achieving the country’s goal of net-zero emissions by 2050 and cutting emissions by 78% by 2035. The emissions savings would be equivalent to the carbon captured by 700 million trees by 2032.

Furthermore, the government also plans to use the Contracts for Difference (CfD) scheme, which is the main tool employed to support establishing offshore wind in the UK. The scheme helps developers with direct protection from volatile wholesale prices and protects consumers from paying elevated support costs when electricity prices are high. The UK government has now launched a public consultation on a preferred hydrogen business model along with CfDs, aiming to bring costs of low-carbon hydrogen to make it competitive against fossil fuel.

The British government is consulting on designing the £240 million Net Zero Hydrogen Fund, which aims to support the commercial deployment of new low carbon hydrogen production plants across the UK. Other measures include supporting multiple technologies including ‘green’ electrolytic and ‘blue’ carbon capture-enabled hydrogen production; develop a UK standard for low carbon hydrogen; reviewing the development of the necessary network and storage infrastructure; to assess the safety, technical feasibility, and cost-effectiveness of mixing 20% hydrogen into the existing gas supply; to launch a hydrogen development action plan in early 2022.

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