Unlocking The Potential of Hydrogen
For many, unlocking the potential of hydrogen represents a familiar, easier and more cost-effective way to transition to more sustainable heating practices in buildings. It is also increasingly seen as a core shift in the energy trade and critically, in the wake of demands to reduce dependency on Russian oil and gas, the future for regionalisation of energy supply.
In the recent report, Geopolitics of the Energy Transformation, from the International Renewable Energy Agency (IRENA), hydrogen it is estimated will cover up to 12% of global energy use by 2050, with at least two-thirds of total production being green hydrogen (produced with renewable electricity) with the remainder blue hydrogen (derived from natural gas).
Here in the UK, the status of hydrogen remains to be confirmed as part of the government’s push towards attaining net zero by 2050. The Heating and Buildings Strategy published in late 2021 does however begin to give an indication of the growing support for the technologies currently being tested.
The government’s commitment so far extends to the testing and evaluation of the potential of hydrogen as an option for heating workplaces. In partnership with industry, the intent is to “clearly define the evidence needed to make a policy decision about the role hydrogen for heating can play in our future energy system.”
To this end, The Department for Business, Energy and Industrial Strategy (BEIS), supported by Innovate UK and Innovate UK KTN, have launched the Net Zero Hydrogen Fund (NZHF) which was most recently cited in this month’s Energy Security Strategy to focus on unlocking the potential of hydrogen. A funding sum of up to £240m has been made available to explore the development and deployment of low carbon hydrogen production. The funding is intended to de-risk investment and reduce lifetime costs of multiple hydrogen production projects this decade to help ensure a diverse and secure decarbonised energy system that meets the UK government’s stated ambition of 10GW low carbon hydrogen production by 2030, and commitment to reach net zero by 2050.
This investment comes in advance of a declared strategic decision by 2026 on the role of hydrogen in heating buildings. This decision will consider the success of development projects that focus on appliances, such as new gas boilers that can be readily converted to hydrogen (‘hydrogen-ready’) and the testing of conversion of the gas grid. The latter in particular is critical in terms of evaluating the technical and practical feasibility of using hydrogen instead of natural gas for heating. This assessment process is also expected to consider the expected costs, benefits, impacts, and practical delivery implications.
This consultation process will also be a factor in decisions in relation to the future of broader boiler and heating system efficiency and explore the best ways to reduce carbon emissions from our heating systems
According to IRENA, the rise of hydrogen’s potential is linked to the plummeting costs of renewables and electrolysers. This greatly improves the economic attractiveness of ‘green’ hydrogen which also can help deliver on the demands for storage that comes hand-in-hand with greater dependence on wind and photovoltaic (PV) power generation. From this perspective, ‘green’ hydrogen becomes an important technology in the extension of renewable electricity developments.
Although ‘Grey’ hydrogen production, which is solely based on fossil fuels, is expected to be rapidly phased out in the coming decades, ‘Blue’ hydrogen, although also based on fossil fuels, is expected to play a complementary role to ‘Green’ hydrogen, so long as the carbon capture and storage (CCS) is proved viable. As a result, hydrogen and hydrogen-based fuels are now projected to meet a sizeable share of final energy demand in 2050, up from virtually nothing today. To achieve this in the UK, the Heating & Building Strategy report outlines the key processes of consultation required for unlocking the potential of hydrogen beyond 2026.
- large-scale hydrogen trials: BEIS and Ofgem have liaised with the gas distribution network operators on the conducting of a ‘village’ scale deployment trial by 2025, and a possible town scale conversion project before the end of the decade.
- Hydrogen blending in the gas grid: to develop the safety case, technical and cost-effectiveness assessments of blending up to 20% hydrogen (by volume) into the existing gas network. This has the potential to deliver up to 7% emissions reductions from the grid. The assessment of indicative cost and value of blending hydrogen is intended to be delivered this Autumn, with the possibility of a policy decision in 2023. This in particular would represent a major first step towards integrating hydrogen in the grid at a potentially national level, but would not require building projects to replace existing natural gas boilers/water heaters.
- Hydrogen-ready boilers: Consideration will be given to the case for enabling, or requiring, new natural gas boilers to be easily convertible to use hydrogen (‘hydrogen-ready’) by 2026 (in domestic projects). This consultation would also test proposals on the future of broader boiler and heating system efficiency and explore the best ways to reduce carbon emissions from gas heating systems over the next decade. The Heating & Buildings strategy makes clearer the commercial implications where, for the moment, if your business uses gas, then you can upgrade to new gas appliances up until 2035, with hydrogen-ready options extending that window well into the 2040s based on current appliance lifespan.
The local trials and planning, research and development and testing outlined will help develop necessary evidence on the role hydrogen can play in the heating of buildings, enabling strategic decisions to be taken on the role of hydrogen in heating buildings in 2026. This timeframe, and the necessity of its elements, are very important to remember when the media is constantly calling for a decision to be made more rapidly. The implications of a transition to a hydrogen grid are immense, but so are the challenges. It cannot be rushed and it cannot fail if net zero is to be realistically attained, especially across the commercial & public sector built environment.
On the global stage, green hydrogen may strengthen energy independence, security, and resilience by cutting import dependency and price volatility. However, the raw materials needed for hydrogen remain exposed to shortages and price fluctuations that could negatively affect hydrogen supply chains, cost and revenues. For this reason, hydrogen, if it is green-lit as a core contributor to the UK’s net zero delivery will not do so in isolation. Just as most buildings will currently rely on both gas and electricity, net zero ‘ready’ organisations will most likely have embraced a mixed approach. This will leverage the advantages of air source heat pumps (ASHP), proven solar thermal and natural gas with a hydrogen blend as a redundancy/peak demand back-up through the 2030s and early 40s. Hydrogen ready’’ adoption should be a necessity by the early to mid-2030’s. Then the UK could look forward to full transition to ‘Blue’ then ‘Green’ hydrogen from the late 2030s and throughout the 2040s at a national scale. Regional rollouts will of course redefine these timelines, but, if the policy supports the adoption of hydrogen from 2026, the technology usage path should remain fairly clear for commercial projects looking at unlocking the potential of hydrogen as a part of their corporate drive toward net zero sustainability by 2050.