RenewableUK, a clean energy trade body, has issued a warning that the UK risks losing out on billions of pounds of investment capital and thousands of jobs unless the government takes urgent action to promote the use of green hydrogen.
In its report titled “Surveying the UK’s Green Hydrogen Supply Chain Capability,” the group highlighted the lack of coordinated planning and investment in the sector.
The UK is in danger of falling behind other countries that have better-managed incentives, such as the EU plans and President Biden’s Inflation Reduction Act, which are supporting the development of green hydrogen.
The report recognizes that the UK has world-class participants in the emerging energy source, but its lack of joined-up thinking on hydrogen as a low-carbon industrial saviour threatens its potential for growth. The government has set a target of 10GW of low carbon hydrogen by 2030, with at least half being green hydrogen. However, the report calls for a new government-industry taskforce to set out in detail how the UK can reach at least 5GW of green hydrogen by 2030.
The UK’s pipeline of electrolysers, the technology used to produce hydrogen, currently stands at 1.5GW and is set for rapid expansion. British innovations in low-carbon hydrogen centre on new electrolyser technologies, and firms like ITM Power and Ceres have seen their products licensed worldwide. However, only 4 MW of electrolysers are currently fully operational, and the report highlights the need for new pipelines to carry green hydrogen and underground storage in disused gas fields.
Most green hydrogen will be produced using electricity generated by offshore wind, and a detailed study of how wind can interact with hydrogen producers can lead to more flexibility in the UK electricity supply, strengthening energy security. The report recommends a better coordination of planning policies and new duties on grid operators for high-volume distribution.
Jane Toogood, director of Johnson Matthey, champions the clean gas in Whitehall. In her first report in March, she urged ministers to look beyond current pilots, and this report goes further, calling for swift action to invest in the infrastructure needed to promote the use of green hydrogen. The report also warns that delays in bringing in vital financial support mechanisms have slowed down the UK’s ability to build projects on a scale big enough to act as proof points for investors and suppliers.
The potential economic and environmental benefits of green hydrogen are enormous, and the report argues that the UK has the potential to become a global leader in the sector. However, to achieve this, the government needs to provide more generous tax breaks and speed up funding streams, such as the Net Zero Hydrogen Fund and the Hydrogen Business Model.
In conclusion, the UK stands at a critical juncture, and urgent action is needed to develop a robust local supply chain in the burgeoning green industry and create export opportunities. The government and the industry must work together to maximize the economic and environmental benefits of this innovative technology, which offers a unique opportunity to deliver growth and jobs.
