The government has unveiled backing for 11 major green hydrogen projects, helping to progress net zero ambitions, and establish the UK at the forefront of hydrogen industry.
Totalling a collective 125MW of capacity, the government confirmed the successful projects under its first hydrogen allocation round (HAR1) will receive a guaranteed price for the clean energy they supply – £241/MWh – and should be operational from 2025.
The biggest of the projects to receive backing is the 24.5MW Bradford Low Carbon Hydrogen project, led by Hygen, followed by the 21MW Barrow Green Hydrogen led by Carlton Power in the North West, and the 14.2MW West Wales Hydrogen initiative, which is being headed up by H2 Energy and Trafigura.
Receiving £2bn in government funding over the next 15 years, the 11 projects – spanning eight regions across England, Scotland and Wales – are also expected to deliver £413mn in private investment between 2024 and 2026, creating 760 direct jobs during construction and operation, as well as millions more being spent across a range of offtakers to convert their operations over to hydrogen.
For example, Sofidel in South Wales is set to replace 50% of their current gas boiler consumption with hydrogen at their Port Talbot paper mill, while the InchDairnie Distillery in Scotland is targeting a boiler to run on 100% hydrogen for use in the distilling process. Elsewhere, PD Ports in Teesside is set to use hydrogen to replace diesel in its vehicle fleet, decarbonising port operations from 2026.
The second allocation round has now been launched, including plans to boost hydrogen capacity to 1.5GW through these rounds and back projects that will deliver up to 4GW of blue hydrogen and 6GW of green hydrogen by 2030. It will close on 19 April 2024.
The government also announced its intention to support hydrogen blending into the gas distribution network under certain scenarios, subject to ongoing assessment of safety evidence and final agreement. These plans would see hydrogen blended with other gases as an offtake of last resort, helping to cut costs for those in the hydrogen sector and support the wider energy system as the UK moves away from the use of natural gas.
It was also announced that the hydrogen for home heating trial in Redcar will not proceed. The project to convert 1,800 homes from natural gas to hydrogen for heating and cooking was cancelled due to sufficient low-carbon hydrogen not being available. A decision will be made in 2026 on how hydrogen could help households move to net zero.
