RenewableUK has called for the UK to harness the power of new technologies, including creating new markets for the likes of green hydrogen, on a pathway to realising a fully decarbonised power system by 2035.
On 22 June, it published a roadmap for net zero, calling on government to accelerate the pace and scale of decarbonisation dramatically, cutting the UK’s exposure to surging gas costs by maximising the benefits of the cheapest sources of renewable power and developing a new green hydrogen industry. To deliver a completely decarbonised power system by 2035, the current market framework must evolve to deliver the pace of deployment required; the way the energy system is planned and regulated must be transformed; and barriers to the development of strategic infrastructure overcome.
Part of the industry’s vision for this is a green hydrogen revolution, with RenewableUK detailing how the diversity of applications and scales, such as in transport and industry, makes the creation of secure, low cost supplies of green hydrogen a “no-regrets” option for government in the development of a hydrogen economy. Developing a hydrogen economy will also create benefits for a decarbonised power system through offering opportunities for offtake from renewable power production, leading to energy system flexibility and inter-seasonal storage.
It further cited research from the Offshore Renewable Energy Catapult, which expects significant cost reduction for renewable hydrogen by 2030, with it proving at least as competitive, or even costing less to produce than blue hydrogen. This is a trend that has been accelerated because of the current gas price spike. Accelerated deployment of electrolysis, as well as targeted research and development, and demonstration projects and technology validation at a large-scale can drive cost reductions. The UK must now develop the right framework to drive down costs and upscale production rapidly over the 2020s.
Therefore, building on the Hydrogen and Energy Security strategies, there are a number of targeted policy and regulatory actions that can be taken to put the UK at the forefront of capturing global opportunities from green hydrogen. Recommendations include ensuring funding is provided to support innovation in design and manufacturing of electrolyser systems, such as through the Net Zero Hydrogen Fund, and defining a zero carbon hydrogen standard and tailoring the Hydrogen Business Model to support green hydrogen production at different scales, including exemption from levies.
Over the longer-term, it called for a level playing field to be created for hydrogen in transport, including through changes to VAT, identifying strategic locations for hydrogen refuelling infrastructure and exploring phase out targets for maritime fossil fuels; to address planning and regulatory barriers to green hydrogen, encouraging retrofit and co-location; and to stimulate demand for hydrogen through clarity on hydrogen production and use, supporting uptake across a variety of sectors.