In the Spring Statement, the government confirmed its plan to remove Climate Change Levy (CCL) costs from the electricity used in electrolysis.
It will consult on the best way to do this through legislative changes and is also committed to carrying out a wider review of the Climate Change Levy in view of the changing energy context. The move has been welcomed by RenewableUK which said it will see reduce electricity costs for billpayers, while also boosting energy security.
Director of Future Electricity Systems, Barnaby Wharton, highlighted a previously released report from both RenewableUK and Hydrogen UK, within which they made the case for such a measure as part of a wider package that would help cut green hydrogen production costs by 58%.
Drawing on the positives of green hydrogen in decarbonising hard to electrify sectors and providing flexibility, Wharton added: “Other measures are also needed to speed up the roll-out of this innovative technology, such as removing barriers to enable green hydrogen producers to co-locate their projects alongside renewable energy generators which already have planning consent to cut costs and reduce delays.”
Wharton further made the case for an “ambitious strategy” to develop a hydrogen transmission network, with pipelines that link Scotland to England and Wales, optimising the availability of green hydrogen.
