On 7 September, Business Secretary Alok Sharma MP issued a response to Environmental Audit Committee chair Philip Dunne MP’s letter sent on 4 August in respect of developing a UK hydrogen strategy.
In the original letter, evidence gathered by the committee for a hydrogen strategy was summarised from 99 pieces of written evidence and an oral online session (see here).
In the response, Sharma acknowledged the growing interest and momentum behind hydrogen, and the government’s role in setting out a strategic approach to hydrogen was acknowledged. The response also set out current mechanisms to support technology development and innovation primarily through clean growth programmes and competitions. It also flagged the on-going work on potential business models.
As part of its evolving strategy, the government will set out ways in which low-carbon hydrogen production and demand can be stimulated throughout the 2020s. End-use demand for hydrogen initially is expected to come from the industrial sector, followed by depot-based transport and applications in heat (through blending) and storage.
Plans for continuation of the Hydrogen Advisory Council for a total of two years were outlined along with BEIS’s current and historic investments in hydrogen, namely £121mn between 2015-2021. Sharma acknowledged the call from industry for a hydrogen strategy and its readiness to invest £1.5bn – outlined through the Hydrogen Strategy Now campaign (see here).
Anticipated hydrogen production methods were also identified, with the government expressing a technology neutral view across these. The two main production techniques were highlighted as blue hydrogen (through natural gas and CCUS) and green hydrogen (through electrolysis from renewable electricity). Long-term hydrogen production methods were identified in biomass gasification and advanced nuclear.
The letter closed with a commitment to consider funding options for the development of hydrogen in the next spending review later this year.
Comment: The letter evidences increasing interest and activity by the government but falls short of promising publication of a formal strategy. Despite this, many in the market are expecting publication of a strategy in Q1 next year.