The government recently released its Hydrogen Strategy, which Business & Energy Secretary Kwasi Kwarteng claims ‘marks the start of the UK’s hydrogen revolution’. The strategy outlines how it will meet its ambitious target of 5GW of low carbon hydrogen production capacity by 2030. As the UK’s hydrogen capacity is currently very low, this strategy will be crucial to ensuring that we can reach this goal.
Hydrogen will play a key role in decarbonising the way we heat our homes and businesses, particularly within ‘hard-to-abate’ sectors, such as heavy industry. The strategy highlights that hydrogen could help energy-intensive industries like chemicals and oil refineries, as well as heavy transport like HGV lorries, boats and trains, by helping these sectors to move away from fossil fuels.
At Bryt Energy, we’ve been aware of the potential for hydrogen to transform these areas for some time. Our parent company, Statkraft, is working to become the leading hydrogen producer in Norway and Sweden and has recently been awarded a contract for the delivery of green hydrogen to the world’s first hydrogen-powered cargo ship.
By 2050, the government believes that 20-35% of the UK’s energy consumption could be hydrogen-based. One of the ways that they intend to reach this level of capacity and consumption is by establishing a hydrogen business model built on a similar premise to the offshore wind Contracts for Difference (CfD) scheme. The proposed scheme, which is currently under consultation, would incentivise investment in hydrogen capacity by providing developers a pre-agreed ‘strike price’ for the gas they provide. The government is also consulting on the design of a £240 million Net Zero Hydrogen Fund, which will support the deployment of low carbon hydrogen production plants across the UK.
If these measures are successful, the government believes that we could create a UK hydrogen economy worth £900 million and over 9,000 skilled green jobs by 2030. Crucially, we could also achieve emissions reductions equivalent to the carbon captured by 700 million trees by 2032.
It’s therefore likely that hydrogen will play an increasingly important role in powering businesses’ operations over the next decade and beyond. Click here to find out more about the Hydrogen Strategy and have your say in the government consultations.