What is low carbon hydrogen?

UK Government policy on low carbon hydrogen

The UK Government has one of the most advanced hydrogen policies in the world built around a 10GW target in 2030 and a carefully developed framework to ensure hydrogen is low carbon and delivers value for money.

Some of this framework follows the hugely successful offshore wind industry where the UK continues to be a world leader.

Much of the policy can be found in the public domain here:

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The UK Government has been supported by a number of other sources who have contributed greatly to the hydrogen policy framework and debate including:

  • A) Jane Toogood Hydrogen Champion review: Know More

    Government recommendation 4:

    Create a plan for integrated energy infrastructure to deliver an optimal future energy system incorporating gas, electricity and hydrogen (and CO₂), enabling balancing of intermittent renewable power generation. Capturing the significant wider system efficiency benefits has the potential to deliver up to £38bn cost savings1. Industry and government should work more closely together to develop this plan.

    Government recommendation 5:

    Provide an integrated plan for the implementation of the Hydrogen Strategy to 2030, building on the existing roadmap. Collaboration and shared accountability between industry and government will be fostered by a visible, joined-up plan for hydrogen across government departments, coordinated by DESNZ.

    Industry recommendation 2:

    Industry and trade associations should work together to evaluate the scale of the economic opportunity of hydrogen, to ensure this is not underestimated. The Government would benefit from additional data to provide the full picture of how many jobs the hydrogen economy could create.

    Industry recommendation 3:

    Industry should work closely with government to identify UK strengths, make voluntary commitments to deliver UK content and to formulate a wider supply chain strategy that builds on UK strengths, as has been done for aviation.

  • B) Chris Skidmore review: Know More

    The UK is uniquely placed to be a global leader in Carbon Capture Usage and Storage (CCUS), which will play a critical role in the transition to net zero. We must act quickly to foster certainty and attract the investment that we need.

    Net zero is a driver of economic growth: it has already delivered growth for the UK and will continue to do so. There are already around 430,000 jobs in low carbon businesses and their supply chains across the country with turnover estimated at £41.2 billion in 2020. Government analysis suggests that nearly 68,000 green jobs have been created or supported since November 2020.

    The Government should continually assess the existing business rates incentives to ensure there are no further inadvertent disincentives for businesses to invest in net zero technologies. For example, up to 50% of business investment is potentially subject to business rates. HMT should consider the balance between increasing business rates and the use of business rates in supporting business growth and decarbonisation.

    The Government estimates that the policies underpinning the Net Zero Strategy and the British Energy Security Strategy could support 480,000 green jobs by 2030, and the Energy Innovation Needs Assessment published by BEIS found that business opportunities identified from decarbonisation could support approximately 500,000 jobs in the UK by 2050.

    “According to our research, the global green economy has recorded a compound annual growth rate of approximately 14% over the last 12 years, increasing its market capitalisation from $2 trillion in 2009 to more than $7 trillion in 2021. Despite the current geopolitical and economic environment, investors are increasingly looking to allocate capital more sustainably. In a recent survey, we found that 86% of asset owners globally are implementing sustainable investment in their strategies – this is up from 76% in 2021.” – London Stock Exchange

    “Higher energy prices are one of the main challenges and obstacles to the industrial decarbonisation…Security of energy supply is an absolute condition to decarbonise. Without security of energy supply, energy intensive industries are unlikely to have to confidence to make the investment necessary to reach the net zero target.”

    “[The] implementation of ambitious circular economy scenarios could generate a ‘win-winwin’ scenario where GDP increases, CO₂ emissions decrease, and jobs are created […] Government could help to create over 450,000 jobs in the circular economy by 2035 in reuse, repair, and manufacturing across the UK” – Green Alliance

  • Power Study
    • Through the Review of Electricity Market Arrangements, develop a strategy as soon as possible on market design for the medium- to long-term for a fully decarbonised, resilient electricity system in the 2030s and onwards. -DESNZ Recommendation
    • Several countries have announced their intentions to export green hydrogen. This offers the UK an opportunity to diversify its energy imports.
    • While unlikely to be cost competitive in the near-term, green hydrogen imports are expected to be cost competitive with domestic green hydrogen production by 2050.
    • While there are a range of hydrogen storage options, salt caverns are the main solution being explored in the UK.
    • Finalise funding mechanisms and allocate funding to support the development of 10 GW of low carbon hydrogen production by 2030. -DESNZ Recommendation
    • Fast track the development of new business models for hydrogen transportation and storage infrastructure, with a view to keeping options open for larger scale hydrogen use by 2030. -DESNZ Recommendation
    • A key aim of the Energy Security Strategy is to reduce the UK’s dependence on imported fossil fuels.

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    “Carbon capture & storage (CCS) is a necessity, not an option, for reaching net-zero emissions”. – Climate change committee, UK

    “Without CCS, our energy and climate goals will become virtually impossible to reach”. – Fatih Birol, Executive Director of International Energy Agency

    “We have to reduce emissions urgently and take action to tackle the carbon already in the atmosphere. Putting a value on carbon thus making carbon capture solutions more economical is therefore absolutely critical.” – The Prince of Wales

  • There has been cross party broad and deep support for low carbon hydrogen in the UK as it is recognised as part of the solution for net zero and especially for heavy industry.
  • Keir Starmer
    Labour Party Leader, Sep 2022

    “That’s why today I’m so proud to launch our Green Prosperity Plan. A plan that will turn the UK into a green growth superpower. And driving the plan forward is a goal that will put us ahead of any major economy in the world: 100 percent clean power by 2030. A huge national effort. An effort that will: double Britain’s onshore wind capacity, treble solar power, quadruple offshore wind, invest in tidal, hydrogen, nuclear. … Let’s get clean hydrogen energy in South Yorkshire, in the East of England, across the river in the Wirral”

    Boris Johnson
    Prime Minister, Jul 2021 in Parliament

    “Yes, I believe that the North West, in addition to the rest of the country, will be a world leader in hydrogen technology. The HyNet project is an excellent example. We have already put £45 million into supporting the HyNet project, kickstarting our hydrogen capture and storage”

    Justin Madders
    Labour MP for Ellesmere Port and Neston and Co-Chair of the Coalition for HyNet North West

    “The HyNet project gives the North West and North Wales an unprecedented opportunity”

    Andy Carter
    Conservative MP for Warrington South and Co-Chair of the Coalition for HyNet North West

    “HyNet North West is essential for securing the future of our region”

    Rt Hon Kwasi Kwarteng
    MP, Oct 2021

    “The ability of HyNet to transform the North West, safeguarding jobs, creating new ones and positioning the region at the forefront of green innovation is hugely exciting”

    HMt, The Growth Plan
    Sep 2022

    “The list below sets out infrastructure projects that will be accelerated as fast as possible, aiming to get the vast majority starting construction by the end of 2023. These projects may benefit from acceleration through planning reform, regulatory reform, improved processes or other options to speed up their development and construction, including through development consent processes.

    HyNet Hydrogen Pipeline; Inovyn Hydrogen Storage (Hynet Cluster, NW); East Coast Cluster Hydrogen Pipeline; Aldbrough Hydrogen Storage (East Coast Cluster, Humber); Hydrogen electrolyser capacity Deployment; HyNet Cluster – CCUS cluster in the North West; East Coast Cluster – CCUS cluster in Teeside and Humber”

    Baroness Brown of Cambridge
    Former Vice-Chair of the Climate Change Committee

    “Hydrogen is a real opportunity for the UK, with a key role to play in the resilient zero carbon energy system we need to meet the challenges of the changing climate and of global politics. The UK missed the boat on battery and wind technology, we can’t afford to miss the boat on hydrogen”.

    Lord Hannan
    Adviser to the UK Board of Trade

    “We should aim to have a diversity of energy sources – not least so as not to have to rely on unfriendly powers. Hydrogen is an important part of the picture, and an area where the UK begins with world-beating advantages”.

    Lord McNicol
    Former General Secretary of the Labour Party

    “Embracing hydrogen is critical to achieving the UK’s net zero ambitions. From supporting the decarbonisation of energy intensive industries to reducing public transport emissions there are myriad applications for hydrogen that won’t just help us meet our climate goals but also protect and sustain high skilled jobs.”

    Polly Billington
    Chief Executive of UK100, (Labour Party)

    “Hydrogen needs to be part of the energy mix to enable the transition to Net Zero. I am pleased to be involved in a thorough assessment of the role of hydrogen, including considering the needs and ambitions of communities and places, as we know there won’t be one solution that works everywhere. We need to ensure that the choices we make now don’t create problems for future generations whilst enabling the economic renewal offered by moving faster towards Net Zero.”

What is Low Carbon Hydrogen?

When energy is used to be clean at the point of use it needs to be either electricity or hydrogen. And then the big questions are …(1) how is that electricity/hydrogen made? and (2) where should electricity be used and where should hydrogen be used?

The low carbon hydrogen standard is the UK Government’s way of ensuring that for every unit of hydrogen produced the CO₂ used to make it is within a defined limit – in case of the UK this is 20g per mega joule of hydrogen produced. This scientifically captures every plant’s associated emissions to ensure that the hydrogen really is low carbon. And if it is not then there is no support from government.

Decarbonisation takes investment and is almost always more expensive than alternative fossil fuels. But this is the price to save the planet so the question is really how to minimise the cost and how to share it fairly. The format that takes will vary from sector to sector and geography to geography. The answer to decarbonise a village in southern Portugal may be very different to decarbonising heavy industry in Ellesmere Port.

We know that decarbonising industry is low hanging fruit in decarbonisation – a few factory sites is much easier and cheaper to decarbonise than millions of homes.

Making Low Carbon Hydrogen

There are two main ways to make low carbon hydrogen and at EET Hydrogen we are doing both!

Blue Hydrogen

One form is to take gas (natural gas or waste gas) and split the molecules using technological process called autothermal reformers or steam methane reformers with carbon capture technology. This captures the majority of the CO₂ (in our processes this is 97-99%) which is then stored in the ground (typically old gas fields). This is commonly known as blue hydrogen or “Carbon Capture Usage & Storage Enabled” Hydrogen.

Note that Blue Hydrogen given its relatively lower cost of production and scalability is often seen as the gateway to reduce CO₂ emissions in the near term and provide the scale to enable hydrogen infrastructure. Over time, and as renewable electricity capacity grows dramatically, we expect this infrastructure to be used increasingly by electrolytic or green hydrogen discussed below.

Blue Hydrogen requires suitable CO₂ storage which the UK is fortunately blessed with – it is estimated that the UK holds around one third of Europe’s entire CO₂ storage. Other nations leading in Blue Hydrogen include many other leading industrial economies such as the United States, Germany, the Netherlands, Norway etc.

Green Hydrogen

Green Hydrogen uses electricity and water to make hydrogen. This is the cleanest form of hydrogen depending on the electricity used. The challenges are grid connections which in the UK can take many years, availability of water and the relative cost of green hydrogen (as most homeowners know electricity is typically 3x more expensive than gas).

Hence in the UK North West for example, the largest Green Hydrogen project is currently around 30MW and our initial blue hydrogen projects are 1,350MW or over 30x the size. We are planning our own Green Hydrogen project albeit we are also constrained and would expect it to be under 100MW.

Using Low Carbon Hydrogen

Low carbon hydrogen is used as an energy source of industrial companies’ fuel switching. For example, Encirc will build an ultra-low carbon furnace in Cheshire. The furnace will use low-carbon hydrogen along with green electricity.

The impact of Low Carbon Hydrogen

Low carbon hydrogen can reduce the emissions from hard to abate sectors (i.e. sectors with little alternative to fossil fuels). It can also be used in road transport, reducing pollution on roads alongside electric vehicles and lower carbon fuels.

1GW of low carbon hydrogen reduces CO₂ by 2.5million tonnes a year. This is equivalent to decarbonising 40,000 cars and 400,000 homes

Mojave desert in the dark

Hydrogen Resources for Schools & Universities

Partnering with schools and universities is a critical part of our strategy as we help build the decent jobs of the future. We are working to add helpful resources here and, in the meantime, we encourage schools and universities to please contact us with any questions.