UK hydrogen deployment has been slower than expected but we should seize the opportunity to make the most of hydrogen as a decarbonisation tool.
Offshore Energies UK (OEUK) has released a report outlining key recommendations for policymakers to accelerate the UK hydrogen sector.
Hydrogen has the potential to decarbonise hard to electrify industries, support energy storage, and enable synthetic fuel production. It can play a unique role in the energy mix, supporting many aspects of the energy transition; however, the market is still evolving.
With the right policies in place, hydrogen could present a decarbonisation pathway and represent a £1.6bn opportunity for the UK economy by the mid-2030s.
The UK’s oil and gas sector is a key enabler of low carbon hydrogen. Gas is necessary to produce low carbon hydrogen with carbon capture and storage (CCS), also known as blue hydrogen, which is the quickest and most cost-effective way to scale up low carbon hydrogen supply.
OEUK members are at the forefront of the UK’s hydrogen sector. The supply chain servicing the North Sea is well positioned, with the expertise and resources to build this new energy sector as part of a wider industrial strategy. Exemplifying this, the report incorporates several case studies showcasing live projects from across the value chain.
OEUK’s Head of Energy Policy Enrique Cornejo said:
'The UK has the people, projects, and potential to make hydrogen a cornerstone of our energy future – but without urgent action, that opportunity could slip through our fingers.
'The UK has over 100 hydrogen projects in the pipeline, equating to more than 15GW of production capacity, but without clarity on key areas and policies, these projects will struggle to progress.
'Hydrogen has a role to play as a decarbonisation solution and for those industries, there needs to be a scale up of the sector. This isn’t only about hitting targets – it’s about securing jobs, investment, and a future for many of these sectors.'
OEUK’s key recommendations:
- Prioritise the deployment hydrogen into industries where it can make the biggest impact in decarbonising sectors, such as high-temperature manufacturing processes.
- Commit to realistic, deliverable deployment targets to attract investment and build confidence in the sector.
- Ensure funding mechanisms for hydrogen business models, such as the proposed Gas Shipper Obligation, are fair and proportionate whilst balancing the need to preserve energy security, reduce energy costs and deliver net zero objectives.
- Policies must recognise the critical importance of domestic gas production in delivering the scale of low carbon hydrogen supplies needed to create this new market.
Source: OEUK
