Policy

'Rule out hydrogen heating — it will make the energy system 18% more expensive', UK told by own advisors

Impartial National Infrastructure Commission also finds that the cost of H2 production would outweigh upfront costs of heat pumps

UK Prime Minister Rishi Sunak leaving 10 Downing Street earlier today.
UK Prime Minister Rishi Sunak leaving 10 Downing Street earlier today.Photo: Getty

The UK should rule out hydrogen heating now so it can focus on the job of decarbonising heat with electric heat pumps, the government’s own independent advisors on infrastructure have said.

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In fact, integrating hydrogen heating into the UK’s energy system would push system costs up by 18% to £2.54 trillion in 25 years, according to the new five-yearly report, published today (Wednesday) by the National Infrastructure Commission (NIC).

But the NIC also called for the UK to pour cash into enabling hydrogen for use in other applications, including energy storage and power stations, and for a build-out of infrastructure for carbon capture and storage (CCS), which is utilised in the production of blue hydrogen from fossil gas.

The NIC — a panel of experts tasked with providing impartial advice to the government on future infrastructure needs and solutions every five years — warned that there is no sound case for using hydrogen to heat buildings.

“Government should rule out supporting hydrogen heating to enable an exclusive focus on switching to electric heating,” the report read.

It analysed six criteria (price, quality, delivery, environment, resilience and economy), and did not give hydrogen heating a single “positive” rating. In fact, H2 was rated as “negative” on four criteria (price, delivery, environment and resilience).
Significantly, the NIC found that the opex and capex costs of integrating hydrogen heating in the UK’s energy system (up to 38% of heat requirements met with H2 against 46% heat pumps) would be 18% higher than a mostly electric pathway (with some district heat), even when including power system upgrades.
Even integrating a relatively small amount of hydrogen heating (13% H2 versus 71% heat pumps) would increase overall system costs by 13%, the analysis found.

“The cost of producing hydrogen is forecast to outweigh the greater in-building capital costs of heat pumps,” said the NIC.

It also flagged that a heating system dependent on blue H2 would expose consumers to shocks in the fossil gas market, while it found that hydrogen heating delivered “more adverse environmental impacts” [than electric pathways] due to leakage of hydrogen, which is an indirect greenhouse gas, and emissions of nitrogen oxides (NOx) that are harmful to human health and are also indirect greenhouse gases.
Significantly, the NIC also cast doubt on the UK’s ability to deliver H2 heating even if it wanted to.

“Coordination challenges are greater in pathways with hydrogen heating due to the need for large numbers of properties to disconnect from natural gas and reconnect to a hydrogen supply at the same time,” it said.

In conclusion, the NIC found that its analysis “demonstrates that there is no public policy case for hydrogen to be used to heat individual buildings”.

The UK government has delayed making a decision on whether to support hydrogen heating until 2026, but has in recent months walked back its enthusiasm for it.

Ruling it out would allow Whitehall to focus on the “challenging but achievable” goal of decarbonising heat with electricity or heat networks, the NIC said — adding that the UK should increase subsidies for heat pumps and offer 0%-interest loans for costs above the subsidy amount.

Subsidies for hydrogen heating infrastructure, meanwhile, should be curtailed.

“Infrastructure solely for hydrogen heating should not be eligible for support under the hydrogen transport business model and today’s gas users should not be expected to pay for the conversion of natural gas infrastructure to transport hydrogen through existing price controls,” it said.

But the NIC also called for the development of “core networks” to transport and store hydrogen and carbon dioxide (as part of CCS infrastructure) by 2035, funded by new “business models” (the UK’s name for Contracts-for-Difference-style subsidies).

In total, 8TWh of hydrogen storage will be needed by 2035, to ensure electricity system resilience during cold winters with low wind supply, the NIC said — pointing out that action is needed today to get hydrogen storage operational by that date.

And it also recommended the development of hydrogen-fuelled power stations to provide long-term flexible power supply as a replacement for gas-fired power stations, on which the UK is currently heavily dependent.

In total, up to 30TWh of long-term flexible generation will be met by hydrogen power and gas-fired power with CCS by 2035, which will need to be supported by subsidies, the NIC explained.

It said: “Government should by 2024 have in place a business model to support hydrogen-fired [electricity] generation and ensure that by 2030 multiple large-scale power stations are deployed for both gas generation with carbon capture and storage and hydrogen-fired generation.”

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Published 18 October 2023, 13:32Updated 19 October 2023, 12:24