• What is the future of Hydrogen as an energy source?

What is the future of Hydrogen as an energy source?

25 October 2022

An introduction to hydrogen

Hydrogen will be part of creating a world that is no longer reliant on fossil fuels. When burnt, hydrogen produces no carbon emissions and has the potential to make the decarbonisation of energy production a reality.

Hydrogen atoms can be found in water, natural gases, plants, and animals, but are always part of other compounds. Hydrogen has an energy density three times that of heavy fuel oil and approximately hundred times that of Lithium-ion batteries, meaning significantly more energy can be stored in a set volume. There are a vast number of potential applications for hydrogen - it can be used for fuel in transportation, heating households and industrial processes, or even as feedstock.

So, what are the opportunities and challenges of using hydrogen to tackle climate change?

Hydrogen production methods and technology

Today, 98% of hydrogen production is carbon intensive. The different forms of hydrogen production are defined by colours:

Blue and Grey Hydrogen

Blue and Grey Hydrogen accounts for 95% of all hydrogen production. Both involve Steam Methane Reforming (SMR); a high temperature process whereby steam reacts with the hydrocarbons in the fuel to produce isolated hydrogen. Blue hydrogen is that blue hydrogen incorporates Carbon Capture, Utilisation and Storage (CCUS) technology, which helps to reduce carbon emissions by approximately 90%.

Green and Pink hydrogen

Green and Pink hydrogen are both extracted through electrolysis of water; water is separated into hydrogen and oxygen when a current is passed through. There are zero carbon emissions involved in the extraction phase, making this process highly environmentally friendly compared to others.

The extraction of green hydrogen is powered by renewable energy sources such as wind and solar power, while pink hydrogen is extracted using electricity generated from nuclear power. Although it costs more to produce cleaner green and pink hydrogen, the overall efficiency is higher relative to blue and grey hydrogen.


The Hydrogen opportunity

The UK has a target of achieving net zero emissions by 2050. The aim is to develop a 10GW low-carbon hydrogen sector by 2030 to contribute to that net zero goal. Only 2% of all current hydrogen production is low carbon, so there is still a long way to go. Nonetheless, there is an opportunity for the UK to lead the development of hydrogen power and technology, creating one of the sustainable industries of the future. This would lead to the creation of new, high-skilled jobs as well as supporting levelling up and the decarbonisation of current high carbon sectors.

To become a market leader, the UK will need to look across the whole hydrogen system, starting with the decarbonisation of production, to creating the necessary infrastructure and establishing practical applications for hydrogen. The challenges include significantly improving CCUS and green hydrogen production technology.

The UK Government has established numerous funds to support companies in switching to hydrogen (and other low carbon fuels) to help achieve both specific targets for hydrogen and the overall zero emissions targets. These include:

  • £315 million Industrial Energy Transformation Fund (IETF) which supports fuel switching technologies (including hydrogen)
  • £55 million Industrial Fuel Switching Competition fund to develop and demonstrate innovative solutions for industry to switch to low carbon fuels (including hydrogen)
  • £40 million Red Diesel Replacement Competition fund to incentivise the development of innovative technologies to allow Non-Road Mobile Machinery (NRMM) used for quarrying, mining, and construction to run on hydrogen and other low carbon fuels (rather than red diesel)

The challenges of hydrogen power

The biggest challenge in producing hydrogen lies in its storage and transportation. This underpins any safe, reliable, and sustainable hydrogen infrastructure.

Most importantly, safety is a major concern in hydrogen production and deployment. It is a highly flammable and explosive element which is approximately 150% more potent than typical hydrocarbon fuels.

Hydrogen is the lightest element and it can escape almost any material that it is contained in, including existing tanks that are designed to store other gases. The development of advanced insulated storage tanks and pipelines will be required as well as novel approaches to convert current infrastructure, such as gas pipelines, to accommodate hydrogen.

Furthermore, hydrogen has an extremely low volumetric density. To be efficiently stored and transported, it needs to be compressed or liquified. This is a problem as there is a 13% efficiency loss when the gas is compressed and a 40% efficiency loss when it is liquified. These inefficiencies will need to be addressed.

Is hydrogen the key to a low carbon future?

A huge amount of investment and innovation will be needed to create a cost-effective and reliable low-carbon hydrogen supply chain by 2050. In particular, the development of green hydrogen will be key.

Hydrogen is not a panacea for addressing carbon emissions or achieving net-zero by 2050, but it can clearly have an important part to play. It also represents an opportunity for the UK to become a market leader in a key low carbon technology, with the creation of high-skill and sustainable jobs.

BDO's R&D and Innovation team support innovation by helping clients access all the financial support that is available for companies that are creating new technologies and intellectual property. Please get in touch to discuss your R&D activities and how to access all the support that is available with Claire McGuigan, Karen Doherty or Tim Scott.