The UK government has backed 11 green hydrogen production projects, set to deliver 125MW of new hydrogen for UK businesses.
These are the first successful projects to be announced for the first hydrogen allocation round (HAR1), following its launch in July 2022.
Revealed yesterday (14 December), the 11 projects and confirmed suppliers will receive a guaranteed price from the government for their hydrogen supply.
In return for this support, as well as providing 125MW of hydrogen, the projects will invest more than £400 million over the next three years in the UK’s green economy, as well as generating over 700 green jobs.
Businesses set to benefit from the new hydrogen supply include Sofidel in South Wales, which will replace 50% of the gas boiler consumption at their Port Talbot paper mill with hydrogen and InchDairnie Distillery in Scotland, which plans to use a 100% hydrogen boiler for their distilling process.
“Hydrogen presents a massive economic opportunity for the UK, unlocking over 12,000 jobs and up to £11 billion of investment by 2030,” said energy security secretary Claire Coutinho.
“Today’s announcement represents the largest number of commercial scale green hydrogen production projects announced at once anywhere in Europe.
“These eleven major new hydrogen projects across the UK will create over 700 jobs and deliver new opportunities from Plymouth in England to Cromarty in Scotland.”
The energy development company, Carlton Power was one of HAR1’s successful companies, with its three projects – a 200MW project located in Trafford in Greater Manchester, 30MW in Barrow-in-Furness (Cumbria), and a 10MW project near Plymouth (Devon) – awarded financial contracts from the Department for Energy Security and Net Zero (DESNZ).
The projects, which will supply 55MW of capacity, will collectively receive an estimated £100 million of investment through the contracts.
Eric Adams, Carlton Power’s hydrogen projects director said: “We are delighted with today’s announcement from DESNZ. Securing contracts for each project – totalling 55MW of capacity and an investment of c£100m, and each with planning consent – is a major achievement and places Carlton Power among the leading British companies that are helping to build the hydrogen economy in the UK.”
Hydrogen blending and heating
The government has also announced its intentions to blend hydrogen with other gases in the distribution network as “an off-taker of last resort.”
It was made clear that this was a separate decision to allowing hydrogen for heating and that blending is not viewed by the government as a way to decarbonise gas.
“While some gas lobbyists may want you to believe that the decision to go ahead with blending is a stepping stone towards decarbonising fossil gas, the government has made clear this is far from the case,” said Juliet Phillips, senior policy advisor at E3G, in response to yesterday’s announcement.
“Hydrogen producers will be permitted to blend small quantities of hydrogen into gas distribution networks as a “last resort”, and only if the safety case is proven. The writing is on the wall for fossil heating systems of the past: it’s time to prepare for a clean, electric future.”
Finally, the government also confirmed that the hydrogen trial in Redcar – a project to explore hydrogen for heating via the creation of a hydrogen village – will not proceed as “the main source of hydrogen will not be available.”
This follows the National Infrastructure Commission (NIC) announcing in October 2023 that it had ruled out the use of hydrogen for heating in its second National Infrastructure Assessment.
Phillips added that the scrapping of the Redcar trail represents “another nail in the coffin for pipedreams of hydrogen heating,” predicting that It is now “nearly impossible” for a positive decision from the government to allow nationwide hydrogen heating in 2026.