UK Hydrogen Strategy outlines 9,000 jobs and £4 billion investment by 2030
Tens of thousands of jobs, billions of pounds in investment and new export opportunities will be unlocked through government proposals for hydrogen deployment in the UK. Business and Energy Secretary Kwasi Kwarteng has set out plans to be realised over the next decade and beyond. The UK’s first-ever Hydrogen Strategy drives forward commitments laid out in the Prime Minister’s ten point plan for a green industrial revolution, setting the foundation for how government will work with industry to meet its ambition for 5GW of low carbon hydrogen production capacity by 2030.
It could replace natural gas in powering around three million UK homes each year as well as powering transport and businesses, particularly heavy industry. :Uniper CEO on the need to ramp up hydrogen economy as big plans for the Humber emerge Two major production plants, as well as several users have come forward as part of transformational plans for decarbonisation on the Humber, where it has already been described as being part of the ‘birthplace of the UK’s hydrogen industry’. Equinor and Uniper have plans for both banks, with a network to be established supplying hydrogen while removing captured carbon for storage under the North Sea, linking with Teesside industry.
Nationally, a booming UK-wide hydrogen economy could be worth GBP900 million and create over 9,000 high-quality jobs by 2030, potentially rising to 100,000 jobs and worth up to GBP13 billion by 2050. Hydrogen could play an important role in decarbonising polluting, energy-intensive industries like chemicals, oil refineries, power and heavy transport like shipping, HGV lorries and trains, by helping these sectors move away from fossil fuels. Mr Kwarteng said: “Today marks the start of the UK’s hydrogen revolution.
This home-grown clean energy source has the potential to transform the way we power our lives and will be essential to tackling climate change and reaching Net Zero. “With the potential to provide a third of the UK’s energy in the future, our strategy positions the UK as first in the global race to ramp up hydrogen technology and seize the thousands of jobs and private investment that come with it.”
Analysis suggests that 20 to 35 per cent of the UK’s energy consumption by 2050 could be hydrogen-based, this new energy source could be critical to meet our targets of net zero emissions by 2050 and cutting emissions by 78 per cent by 2035 – a view shared by the UK’s independent Climate Change Committee. Energy & Climate Change Minister Anne-Marie Trevelyan said: “Today’s Hydrogen Strategy sends a strong signal globally that we are committed to building a thriving low carbon hydrogen economy that could deliver hundreds of thousands of high-quality green jobs, helps millions of homes transition to green energy, support our key industrial heartlands to move away from fossil fuels and bring in significant investment.”
The government’s approach is to be based on the UK’s previous success with offshore wind, where early government action coupled with strong private sector backing has earned the UK a world-leading status. One of the main tools is the Contracts for Difference (CfD) scheme, which incentivises investment in renewable energy by providing developers with direct protection from volatile wholesale prices and protects consumers from paying increased support costs when electricity prices are high. A public consultation has now launched on a preferred hydrogen business model which, built on a similar premise to the offshore wind CfDs, is designed to overcome the cost gap between low carbon hydrogen and fossil fuels, helping the costs of low-carbon alternatives to fall quickly.
The design of a GBP240 million Net Zero Hydrogen Fund is also being consulted on – it aims to support the commercial deployment of new low carbon hydrogen production plants across the UK.
Business and Energy Secretary Kwasi Kwarteng, then Clean Growth Minister – third left – visiting Orsted’s East Coast Hub on Grimsby Docks, where offshore wind and hydrogen technology is being united to fuel switch at Phillips 66 Humber Refinery in the Gigastack project. (Image: Rick Byrne / GrimsbyLive)
An early leader in hydrogen deployment is ITM Power, working with Phillips 66 Humber Refinery and Orsted on the Gigastack project in the Humber. The Sheffield firm also provides electrolyser units to industry globally.
Chief executive Dr Graham Cooley said: “By supporting the creation of a UK home market, today’s announcement is a very welcome step in helping British companies cement their positions as world leaders in hydrogen technology. The industry needs a policy landscape in place that identifies priorities and support mechanisms for rolling out green hydrogen production in the UK and that’s just what today’s Hydrogen Strategy sets out. “Green, zero-carbon hydrogen can abate greenhouse gas emissions from industry, transport and heat.
It can be used to store our abundant renewable energy from offshore wind and longer term, be used to create export markets. This is a win for the UK’s decarbonisation plans, a win for cleaner air and a win for British jobs.” Greeting the strategy release, chief executive at SSE, Alistair Phillips-Davies, also flagged projects in the Humber.
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By signing up for our daily newsletters, email breaking news alerts and weekly round-ups from all the major sectors, you get our journalism direct by email. To sign up, find out more and see all of our newsletters, follow the link here He said: “We strongly welcome the publication of this first-ever Hydrogen Strategy and hope to turn this encouraging strategy into firm and rapid action through our exciting plans.
These include working with Equinor on the world’s first major hydrogen-fired power station at Keadby and developing hydrogen storage caverns at Aldbrough, as well as our partnership with Siemens to co-locate hydrogen production facilities at our wind farms. The strategy is a welcome first step to realising the potential of hydrogen.” To prioritise and support polluting industries to significantly slash their emissions, the government also announced a GBP105 million funding package through its Net Zero Innovation Portfolio that will act as a first step to build up Britain’s low carbon hydrogen economy.
The investment will help industries to develop low carbon alternatives for industrial fuels.
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