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The UK Hydrogen economy may be in its infancy, but investment and growth are increasing.

By August 23, 2023 No Comments

The hydrogen economy is still in its infancy but it is constantly gaining international recognition and traction.

In some quarters there is a distinct resistance to the uptake of hydrogen as part of international efforts to reduce global emissions. Concerns about the capacity to produce 100% green hydrogen whilst also focussing on enough renewable energy to go around, is one negative voice in the hydrogen arena. This is coupled with concerns about storage, transportation, and the capacity to build a functioning and safe infrastructure.

However, it must be remembered that the same concerns were being raised about electrification when it too was in its infancy. Despite all of the progress made in the electrification sector, there are still concerns about a fully functioning global infrastructure and enough renewable energy to support transition.

Back in the hydrogen arena things are starting to change. International Governments are including and acting on Hydrogen policies as part of their decarbonisation programmes. Investment is being put into a flexible and attainable infrastructure. Electrolyser technology is moving on apace. Investment in storage, transportation and the recognition of how hydrogen can support energy and transport is gaining momentum.

There is an inevitability that there will be challenges to face during a clean energy industry’s tipping point. The transition away from fossil fuels and the acceptance of the relevant input required to achieve this is not always met with an appropriate level of acceptance or enthusiasm.

Undeterred by the sceptics there are companies who are determined to support the transition away from fossil fuel and they plan to do so in the upcoming hydrogen economy.

Hydrogen is pivotal in the transition away from fossil fuels due to its carbon emissions-free combustion. The International Energy Agency projects that electrolyser capacity must expand to approximately 560 GW by 2030, a substantial increase from the estimated 3 GW in the present year, in order to achieve clean energy targets. (1)

The UK has already made considerable progress in its incentives for hydrogen production and a collaborative approach has been adopted by some industry leaders with some Government backing. Two of the UK hydrogen innovators forging forwards and supporting the hydrogen economy are HyNet and ITM Power.

The HyNet project in Northwest England aims to create the UK’s first low-carbon hydrogen production hub, supplying fuel for transport, industry, and heating.

The HyNet project is one of the leading collaborative CO2 removal projects with 5 major industry names capable of removing up to 3 million tonnes of C02 whilst supporting the UK’s net-zero targets.

Hanson Cement, Viridor, Encyclis, Buxton Lime Zero (Tarmac) and Vertex Hydrogen, committed to removing carbon dioxide emissions through the HyNet project, have been announced by Government to move forward in decarbonising their operations creating an entirely new Carbon Capture sector in the Northwest of England and North Wales. (2)

The UK Government have also pledged a £20bn investment into the decarbonisation of industry through CCS and the HyNet project is taking the lead on this project.

Another UK company pushing hydrogen forward is ITM Power specialist electrolyser manufacturer.

Over the past twenty years ITM have been designing and manufacturing electrolyser systems which generate green hydrogen based on proton exchange membrane (PEM) technology. The ITM electrolysers require just renewable energy and water to produce green hydrogen.  ITM recognise that international interest in hydrogen production is growing and have therefore scaled up production.

In 2021, ITM opened their new factory at Bessemer Park, Sheffield, representing a considerable investment and recognition of their ambition as a business.

However, ITM have seen the resistance to the hydrogen economy first hand and a recent restructure has allowed them to refocus their business model.

Despite ITM managing to achieve a revenue of £5.2 million in its fiscal year, surpassing the projected £2 million the company has noted a “temporary slowdown” in investor approvals for new projects, attributed to elevated electricity costs, inflation, and uncertainties about government support. (1)

However, this situation and the implementation of a new management structure, has granted ITM the “breathing space required to focus on implementing” its turnaround plan. (1)

CEO Dennis Schulz expressed optimism about the progress achieved since the initiation of the company’s turnaround plan earlier in 2023. (1)

Despite some investments slowing down, Schulz is committed to restoring investor and customer trust, including efforts to reduce the company’s product range and decrease the workforce by 25 percent.

The HyNet collaboration and ITM Power are juts two areas where the hydrogen economy is being championed and with Government and private investment, the UK can become a beacon for hydrogen and in particular green hydrogen production.

Written and cited by Katy Mason for and on behalf of Dolphin N2.