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What will the UK do with the hydrogen it produces?

The UK government is targeting large-scale production of hydrogen, but will it be put to better, more effective use for transport instead of heating, as planned?

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One of Alstom’s hydrogen-powered trains in a station in Leipzig, Germany. The UK has been criticised for being behind many other Western countries when it comes to hydrogen adaption, and there is a growing feeling that its focus should be on utilising the fuel for transport instead of heating. (Photo by Peter Endig/DPA/AFP via Getty Images)

Public interest in hydrogen as a clean fuel was piqued again in late November 2020 when the UK government unveiled its ten-point plan for a Green Industrial Revolution.

Hydrogen has officially made it into the government’s top ten ideas for reducing the UK’s carbon emissions while also boosting its economy, but details on potential applications for this lightest of gases were only loosely sketched in Prime Minister Boris Johnson’s announcement.

The government has said that it is “aiming to generate 5GW of low-carbon hydrogen production capacity by 2030 for industry, transport, power and homes”, although it is not clear exactly how low this ‘low-carbon’ hydrogen will be.

That hydrogen will play a major role in a future climate-neutral energy system is widely accepted, but the government’s support of blue hydrogen (produced from natural gas) alongside green hydrogen (produced from renewable power) has drawn criticism on environmental grounds. The costs involved with ramping up hydrogen production will be significant, and funding models are also still to be determined.

The biggest uncertainty regarding this hydrogen revolution, though, is what the government plans to do with all the hydrogen it plans to produce. There are various possible applications but they all need government support to be accelerated.

The government’s initial focus appears to be on using hydrogen as a heating and cooking fuel to replace natural gas. However, there is a growing feeling that transport applications look a safer bet.

Building the UK’s hydrogen demand alongside supply

A campaign group consisting of more than 50 companies called Hydrogen Strategy Now claims private businesses are ready to invest £3bn in hydrogen projects in the UK. It warns that the UK risks being left behind by other countries such as Australia, Canada, China, Germany, Japan and South Korea, which are already investing heavily to develop hydrogen initiatives.

The UK government has said it will provide £500m for its hydrogen project, with about half of this going to build production facilities, and only outlined one potential use for hydrogen in its ten-point plan. It said it wanted to trial its use within homes starting in 2023.

UK companies Cadent and Progressive Energy are developing the HyNet North West project, which will be powered by a natural gas, albeit with carbon capture and storage technology to reduce carbon emissions.

HyNet North West is one of the first wave of new production facilities. The developers will begin a public consultation ahead of application to government for the project’s first development consent order in 2021. The developers say the project could create 6,000 new jobs in the area around Ellesmere Port in north-west England, and they are targeting first operation in 2025.

Worcester Bosch, the UK subsidiary of German engineering company Robert Bosch, had already made preliminary investments into developing hydrogen-ready boilers before the government announcement. Company CEO Carl Arnzten says the government’s production target means Bosch will now move to industrialise its design concepts.

While Arnzten welcomed the focus on hydrogen, he says the government should now mandate the use of hydrogen-ready boilers in the UK from 2025 to further drive investment. He adds that “the UK has one of the most advanced gas distribution networks in the world; therefore, putting aside the short-term issues of Brexit and Covid-19, we continue to see the UK as a key market to invest in”.

UK energy regulator Ofgem approved in late November 2020 a first trial for introducing hydrogen blends into the natural gas grid network. Testing is due to begin in 2022.

The wisdom of using hydrogen for heating remain contested, however, with academic research showing hydrogen to be a far less efficient heating method than alternatives, such as heat pumps. This has led some to question whether a nationwide roll-out of hydrogen in homes is either likely or desirable.

Transport a more immediate application for hydrogen?

A less controversial and more immediate application for hydrogen looks to be in the transport sector. Northern Ireland-based Wrightbus is due to introduce 20 hydrogen-powered buses to routes in the West Midlands in April 2021. German company Siemens is the manufacturer of the buses’ drivetrains, while the fuel cells are produced by Canadian company Ballard.

“Hydrogen is definitely going to scale up, but you have to start thinking now about what is going to be at the end of that pipe… in transport, which will be an important application of hydrogen, we think it will be fuel cells,” says Dr Michaela Kendall, co-founder and CEO of fuel cell company Adelan.

Fuel cell technology, which can convert the chemical energy of fuels such as hydrogen into electricity, is not a new technology but has to date been prohibitively expensive to commercialise. Kendall believes government-stimulated demand can help to finally create the scale of production needed to drive costs down, as previously seen with solar and wind power.

Electric battery costs are already seeing those efficiencies of scale, but as Kendall observes, “there is not enough lithium on the planet to electrify everything”. Hydrogen fuel cells could potentially meet specific needs in the transport network.

However, there was no mention of fuel cells in the prime minister’s November announcement and government funding for the technology remains limited.

Hydrogen trains on local lines

Trains are another area of transport in which hydrogen shows great potential, although French rail company Alstom sees it as being better suited to smaller, rural routes on the UK network where electrification or use of batteries would be prohibitively expensive or difficult. The cost of converting diesel trains to hydrogen would be comparatively inexpensive, although it would require fuelling stations, and possibly small-scale production facilities, to be built along rail routes.

Mike Muldoon, head of business development at Alstom UK and Ireland, says that if the UK government committed to its first fleet of hydrogen trains tomorrow, his company could get those trains on the track by 2024.

“We need to get over the hurdle of deploying the first fleet or two and get into volume production,” he adds. “That is the key to unlock all of this.”

In 2018, the government challenged train operators to remove all pure diesel trains from the UK network by 2040, and given trains typically have a 35-year life this has forced companies to evaluate alternatives. However, it is a challenge rather than a requirement and government-run franchise competitions remain, at least in theory, technology agnostic.

Muldoon says that procurement should be based on cost compared with other non-diesel technologies, while performance should be judged against existing diesel services. On that basis, hydrogen trains will begin to be selected for routes.

The government committed to a Restoring Your Railway Fund in the November 2020 spending review, which will be used to fund the restoration of local routes that were closed in previous rail reforms. This should offer even more opportunities for the deployment of hydrogen trains.

Alstom’s centre of excellence for global train modernisation is already based in Widnes in the north-west of England, and Muldoon says this facility could become its global hub for hydrogen train conversion.

Groups such as Hydrogen Strategy Now show there is strong investor demand for the use of hydrogen in the UK, and the inclusion of hydrogen in Johnson’s speech has been widely welcomed. The government will need to decide which initiatives it chooses to back, however, at a time when public funds are likely to be restrained.

“It is important that people understand the scale of foreign direct investment appetite out there for hydrogen and fuel cells right now,” says Kendall. “It has never been at this level before and the UK has to take this opportunity.”

For more articles on hydrogen or other energy matters, please visit our sister site Energy Monitor.

Jon Whiteaker

Jon Whiteaker

Senior editor

Jon Whiteaker is a senior editor at Investment Monitor focusing on FDI in the energy sector.