'Disaster in the making' | Hydrogen boilers 'will cost two to four times as much to run as gas heating'
Even conservative estimates based on blue H2 made with cheap pre-gas-crisis fossil fuels show 100% hydrogen heating will be prohibitively expensive, says think tank
The use of 100% hydrogen in space heating will cost at least twice that of fossil gas and could cost almost four times as much if using hydrogen made with grid electricity, according to new analysis from a UK-based think tank.
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Using pricing data from the UK government, the Regulatory Assistance Project (RAP) found that the use of hydrogen made with grid electricity and an alkaline electrolyser would push the retail heating price to around £0.19/kWh ($236/MWh) by 2030, compared to around £0.05/kWh ($62/MWh) for fossil gas.
By 2050, this would only have dipped to around £0.18/kWh, the modelling found.
Green hydrogen made using a dedicated offshore wind farm would be slightly cheaper, coming in at around £0.12/kW by 2030 and £0.10/kWh by 2050 — still twice as expensive as fossil gas, and similar in price to blue hydrogen made with fossil gas and carbon capture and storage (CCS).
This is because the UK government has yet to update its hydrogen price projections, so in order to “compare apples with apples”, the authors used government gas price data and hydrogen price projections from before the gas price spike in 2022.
As gas prices are expected to fall almost back to pre-2022 levels by 2030, these data sets give a clearer long-term picture in any case, explained authors Jan Rosenow and Richard Lowes.
“It seems increasingly likely that the mass use of hydrogen for heating is a disaster in the making,” said the authors. “The fundamental physicals means that, compared to electrification it is an inefficient and costly option.”
RAP also found that introducing blends of hydrogen into the existing gas mix would raise UK consumer heating bills significantly. A 20% blend would increase prices by 20% if using grid-derived electrolytic hydrogen and 8% if using hydrogen from a dedicated offshore wind farm.
“This is alarming because it means that energy billpayers could end up subsidising industrial polluters by funding hydrogen for industry, whether or not any of the energy being subsidised reached households,” the report warned.
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