Kick-starting a hydrogen economy a core part of government’s energy vision


The government has published its long-awaited Energy White Paper, setting out its plans to deliver a clean energy system and support hundreds of thousands of green jobs.

The paper, published on 14 December, builds on the Prime Minister’s recent 10-point plan for a Green Industrial Revolution, sets out measures that will lead to emissions cuts of up to 230MtCO2e in power, industry and buildings, while supporting up to 220,000 jobs per year by 2030. This would include long-term roles in major infrastructure projects for power generation, carbon capture storage (CCS) and hydrogen.

Kick-starting a hydrogen economy was highlighted as a core part of the paper, with government reiterating its desire to work with industry to deliver 5GW of hydrogen production capacity by 2030. This would be supported by a £240mn net zero Hydrogen Fund and the publication of a dedicated Hydrogen Strategy in “early 2021”, while next year will also see government consult on its preferred model for a commercial framework – to be introduced in 2022 – which allows project sponsors to finance clean hydrogen projects.

Hydrogen will be among the clean alternatives the UK turns to in its shift from fossil fuels in multiple areas, including in buildings – the UK’s second largest source of emissions at 19% – where, alongside improving energy performance, emissions from heating and cooling must fall.

The feasibility of using hydrogen for clean heat will require further testing and development, however, with government pledging to increase the funding available for testing and trialling projects. It stated a range of further R&D and testing projects are required, including an assessment of the options for major new hydrogen infrastructure. Government will also consult on the role of hydrogen ready appliances in 2021, continue to work with the Health and Safety Executive to enable up to 20% hydrogen blending on the network by 2023, and reaffirmed that it will work with industry to begin a Hydrogen Neighbourhood trial by 2023, progressing to a potential Hydrogen Town by 2030.

In industry, where emissions must fall by 90% from today’s levels by 2050, government is looking to establish the UK as a world leader in the deployment of CCUS and clean hydrogen, supporting up to 60,000 jobs by 2030. It signalled its ambition to capture 10Mt of carbon dioxide a year by 2030 and will invest up to £1bn to support the establishment of CCUS in four industrial clusters. Details on a revenue mechanism to bring through private sector investment in industrial carbon capture and hydrogen projects will arrive in 2021.

Delivering net zero by 2050 will also see the oil and gas sector in the UK transform, with government pledging to provide opportunities for oil and gas companies to repurpose operations away from unabated fossil fuels to abatement technologies, such as CCUS, or clean energy production, such as renewables and hydrogen. It acknowledged that the industry has the skills, technology and capital to unlock innovative solutions that could prove instrumental in delivering net zero and in 2021, with government pledging to agree a transformational North Sea Transition Deal with industry to work towards this.

Elsewhere, government will invest £1bn in a UK energy innovation programme to develop technologies of the future, such as advanced nuclear and clean hydrogen; identify and utilise synergies between hydrogen and the deployment of offshore wind; invest £20mn in 2021 for HGV freight trials pioneering hydrogen and other zero emission truck technologies; give greater consideration to decarbonising rail through battery and hydrogen on less intensively used parts of the network; and launch a £20mn Clean Maritime Demonstration Competition, supporting the UK design and development of clean maritime technology, including hydrogen.