Column by Celia Greaves, CEO of the UK HFCA
The UK Hydrogen and Fuel Cell Association welcomes the publication of the Government’s Hydrogen Strategy.
We are pleased to see the Government reaffirm its commitment to the hydrogen sector, with analysis suggesting that up to one third of the UK’s energy consumption by 2050 could be hydrogen-based. We support the ‘twin-track’ approach, which will help us scale up and decarbonise more quickly. However, we believe that the Strategy could have been more ambitious. Industry believes that with the right support, a 20GW mix of green and blue hydrogen power could be deployed by 2030. That is four times more than the Government has planned for.
Government needs to introduce business models that are attractive and workable for both green and blue hydrogen and reflect their different characteristics. We welcome the publication of the consultation on business models and look forward to working with Government to develop the right initial business models so that both green and blue hydrogen can compete with traditional sources of power and heating. The sooner these models are decided, the quicker investment in generating capacity can be unlocked. This is particularly important if the UK is to hit its interim carbon emissions reduction targets in 2030 (a 68% reduction) and 2035 (a 78% reduction). Furthermore, without rapid progress, the growing UK hydrogen industry risks falling behind internationally and failing to deliver the significant clean growth that is needed.
The Strategy earmarked a number of important components that are needed for the production and use of hydrogen into the future. The UK HFCA has been calling for a minimum standard to which companies must produce low carbon hydrogen. We are pleased this has been confirmed, since it will be important to secure investment and to provide confidence to society in the sustainability benefit of hydrogen.
The Government is also right to highlight the need for a hydrogen network and storage plan so that hydrogen can be stored and moved to where power demand is needed. And we are pleased to see multi-million pound funds for industrial fuel-switching and for hydrogen to power off-road machinery instead of diesel. It’s clear that when these support mechanisms are up and running, the Government will need to spend more than £240m on funding the deployment of hydrogen. While the sums announced today are a welcome start, a commitment to further investment through the Comprehensive Spending Review and the Treasury’s long-awaited Net Zero review is needed in order to provide investors and the industry with confidence that the UK will really back hydrogen. For now, however, the Strategy signals progress and greater clarity. The UK now needs to pick up the pace to turn the policy ambition into investment, jobs and a cleaner future.