The government has announced a massive boost to the production and use of hydrogen in the UK as part of its Energy Security Strategy.
It envisages hydrogen as being a fuel not only for transport but also for heavy industry and for heating homes.
The new support includes:
- The £240m Net Zero Hydrogen Fund, funding low carbon hydrogen production projects, with the aim of awarding funding from the end of 2022. This will advance the government’s ambition to have up to 2GW of low-carbon hydrogen production capacity by 2025 and up to 10GW installed by 2030, using electricity to produce power from water by splitting water into hydrogen and oxygen;
- The Hydrogen Business Model, which will support further investment in hydrogen production with £100m for electrolytic projects to cover the difference between the cost of production (the strike price) and the sale price for hydrogen (reference price). Funding for this will launch this summer; and
- The Industrial Hydrogen Accelerator, a £26m innovation funding programme to support UK industry in adopting hydrogen as a clean, affordable fuel source for sectors like manufacturing by demonstrating the feasibility of hydrogen to businesses and reducing the cost of switching energy systems.
The government support for hydrogen is being complemented by private investment, including ITM Power’s announcement of a new electrolyser plant in Sheffield which will support the hydrogen industry and create 500 jobs.
It has submitted plans to build a new £70m electrolyser production facility in the city as part of a £250m expansion programme. It will be the hydrogen specialist’s second factory in the city.
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