Hydrogen can meet up to half of the UK’s final energy demand by 2050 and play a significant role in meeting the country’s net-zero emissions targets, according to research by Aurora Energy Research.
The report concluded that both blue hydrogen – produced from natural gas after reforming to remove carbon content – and green hydrogen made by renewable energy could supply 480 terrawatt-hours of hydrogen by 2050.
Large-scale hydrogen adoption could also help to integrate renewables into the power system by reducing the requirement for flexibility during peak winter months, and boosting revenues for renewables generators by about £3bn a year by mid-century.
The report said that the roll out of hydrogen could accelerate green growth and enable the development of globally competitive low-carbon industrial clusters, while utilising UK’s competitive advantage on carbon capture and storage (CCS).
Low-regret options for government include the stimulation of hydrogen demand in key sectors, the deployment of CCS in strategic locations and the standardisation of networks.
“These initiatives could form an important part of the UK Government’s post-COVID stimulus plan,” Aurora Energy said.
It added that falling technology costs and gas prices will drive steady reduction in the market hydrogen price, which is expected to go below £50 megawatt-hour in 2050.
Hydrogen storage in salt caverns can provide security of hydrogen supply in most years, but additional strategic reserve capacity of up to 7GW will be required to ensure system adequacy during extended scarcity periods, the report said.
Aurora Energy Research head of commissioned projects for Western Europe Felix Chow-Kambitsch said: “As part of its post-Covid stimulus plan, the UK government should consider policies towards meeting their commitments of net zero emissions.
“Stimulating the development of hydrogen infrastructure in the UK could facilitate the low-carbon energy transition as part of the UK’s efforts to hit its net-zero target and unlock opportunities across UK industry and transport.
“Hydrogen could eventually meet up to 50% of total energy needs – across power, heating, industry and transport.
“The accelerated deployment of low-carbon power generation will enable utilities to create hydrogen from surplus power, while carbon capture technology enables the decarbonisation of natural gas and provides the required scale to the hydrogen sector.
“Unlocking the benefits of a hydrogen economy will require early support from Government, systematic changes to our energy system and significant investment by the private sector.”