By Nicholas Earl
The Government’s energy security strategy, unveiled after Russia’s invasion of Ukraine and motivated by Downing Street’s desperation to reduce its reliance on overseas fossils fuel, contained plenty of eye-catching pledges.
This included boosting offshore wind to a whopping 50GW by the end of the decade and a wildly ambitious pledge to green light eight new nuclear reactors in the next eight years.
The strategy has become increasingly urgent following the escalation of conflict in Europe, exacerbating a long-running need to boost domestic energy supply, while also aiming to reach net zero carbon emissions by 2050.
Away from the media spotlight, there was also a pledge to double its previous target, pushing to ramp up capacity of low carbon hydrogen to 10GW by 2030.
Low carbon hydrogen refers to green hydrogen, which is produced by splitting water into hydrogen and oxygen through renewable electricity.
This consists of breaking water molecules using an electric current in an electrolyser, in order to extract the dihydrogen H2.
Downing Street aims to run annual allocation rounds for electrolytic hydrogen, moving to price competitive allocation as soon as market conditions allow, so that up to 1GW of electrolytic hydrogen is in construction or operational within the next three years.
John Mullen, UK Energy Market Director at energy specialist Ramboll is sceptical any of these ambitions can be met without clear direction from the Government concerning investment.
He said: “10GW is a realistic but challenging target and needs much more support and guidance from the government on where investment and innovation should be focused to be achieved, and some security on hydrogen costs.”
Ramboll is a global environment consultancy group, and are members of Scottish Renewables’ green hydrogen policy.
One of the biggest global players in the hydrogen sector is energy giant Shell, which owns and operates 10 per cent of total electrolyser capacity in the world, including vast projects in China and Germany.
It also recently announced plans to construct a 200MW electrolyser on the Tweede Maasvlakte in the port of Rotterdam, which will produce up to 60,000kgs of renewable hydrogen per day.
Shell’s UK Country Lead for Hydrogen Industry Luci Austin told City A.M. green hydrogen could play a valuable role in decarbonising hard-to-electrify sectors such as heavy-duty transport, shipping and aviation.
She argued it can also work as an inter-seasonal storage for other energy sources such as offshore wind, bolstering energy security.
Austin said: “All forms of decarbonised hydrogen are needed. Large-scale hydrogen generated from renewables is our goal and we are actively investing in this space, but to achieve the scale needed in the coming decade.”
This perspective was shared by challenger hydrogen specialist Octopus Hydrogen, which considers hydrogen’s role to be as an intermittent power source to buttress abundant renewable generation from wind and solar, and for electrification of problem areas within the energy sector.
Alongside heavy good vehicles, the company sees a role for hydrogen in powering short-haul flights.
Founder and chief executive Will Rowe explained: “You’re probably not going to be flying to southern Spain on a hydrogen-powered plane by the middle of 2030. That’s probably a 2040 problem, or back end of 2030s. But could you be flying from London to Amsterdam or Amsterdam or Paris? I think that’s possible.”
Octopus Hydrogen is home to two 1MW sites, and provides fuel at a UK airfield where it is testing potential flights with a 19-seater aircraft.
1MW produces around 200-400 kilos of green hydrogen per day, with Octopus now targeting a move towards the 10-20GW.
For context, 1000kg per day could power 50 buses.
Rowe said: “You’re talking about getting into sensible, larger volumes that can support material, decarbonisation efforts.”
Blue hydrogen: Industry solution or a waste of time?
Shell has confirmed it will invest £25bn in the UK’s energy infrastructure amid bumper earnings for the energy giant from soaring oil and gas prices., of which 75 per cent is intended for low and zero-carbon services.
However, it has also signed a deal with Uniper to produce blue hydrogen at the German company’s Killingholme power station site.
Blue hydrogen remains an area of contention within the energy sector, as it is derived from natural gas.
This energy source is favoured by some companies due to its cheaper production costs and the possibility to re-use fossil fuel supplies, which remain dominant in the energy sector.
Austin called for hydrogen to be combined with carbon capture and storage, in line with the hydrogen project Shell is also developing with Uniper in Humberside.
She said: “Projects such as this will help to reduce emissions but also help stimulate economic growth and jobs.”
The company has also teamed up with Pale Blue Dot Energy on a project in Scotland, which aims to reform North Sea natural gas into hydrogen which would then be used in transport, to decarbonise heating in homes, and in heavy industry.
However, others have raised concerns over its efficiency and in consuming more gas, which has exposed its vulnerability to geopolitical instability in recent months.
Commenting on the viability of blue hydrogen, Mullen said: “Blue hydrogen is currently lower cost than green, but it comes with the geographical constraint of carbon capture, usage and storage (CCUS), which is an inefficient and chemically intensive process and carries the residual risk of CO2 storage.”
Rowe recognised its value for companies that export a lot of natural gas, but was also sceptical about the value of blue hydrogen in meeting the UK’s energy needs – due to both cost and emissions concerns.
He said: “We’re a net importer of gas – the idea of importing gas or importing hydrogen that was gas somewhere else just strikes me as not helping energy security. It is certainly not going to be cheaper than gas was in the first place, and there will still be 20 per cent of the CO2 that was there to start with.”
Buses, batteries and supplementary supplies…and scepticism of blue hydrogen.
When pressed on whether Octopus was underplaying hydrogen’s capabilities of meeting country’s energy needs, Rowe argued it was important to be realistic rather than to attribute miracle-producing qualities to burgeoning energy sources.
He said: “The last thing I want to do is say, “Oh, great, the hydrogen market is getting bigger and bigger, and the applications are poorly defined or not very sensible, but it was okay for us because we could make progress.’ That won’t last because fundamentally it can’t be sustained.”
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