The podcast delves into the UK's hydrogen landscape, comparing fossil-based and renewable production. They discuss the rise of blue hydrogen capacity, cost calculations for production, and the growth potential in the UK market. Insights are shared on carbon intensity metrics and the push for renewable hydrogen prices to decrease.
UK emphasizes blue hydrogen with CCS for scale and value.
Hydrogen market development projected to include spot market and regionalized activities.
Deep dives
Global Excitement Around Hydrogen Adoption
Across 2020 and the first quarter of 2021, there has been a significant global interest in using hydrogen to decarbonize challenging sectors. National hydrogen adoption strategies have been introduced by governments representing 70% of the global GDP. These strategies provide a foundation for market development and offer investors the needed certainty and government support. The pipeline of low carbon hydrogen production capacity set to come online by 2030 has increased by almost 350%, with electrolyzers for renewable hydrogen production being more deployed than fossil-based production.
UK's Focus on Blue Hydrogen Production
The UK appears to be emphasizing fossil-based hydrogen production with carbon capture and storage (CCS) compared to mainland continental Europe's preference for renewable production. Blue hydrogen offers benefits like leveraging mature low-cost technology, achieving larger scale deployment, and providing value to energy players with stranded fossil assets. The UK's ample geologic carbon storage capacity and access to low-cost natural gas from the North Sea position it to excel in blue hydrogen production.
Hydrogen Price Assessments and Market Development
Platts' hydrogen cost of production assessments aid in understanding the market by considering production pathways in the UK, including auto thermal reforming (ATR) with CCS, proton exchange membrane (PEM) electrolysis, and alkaline electrolysis. The assessments represent a snapshot of production facility costs and factor in fixed and variable costs. Future market development is projected to lead to a spot market for hydrogen, starting in industrial clusters, and green hydrogen technologies are expected to contribute to regionalized market activities by meeting demand in various sectors.
The UK’s hydrogen production landscape is littered with big natural gas-based CCS projects – why is this, and what does it say about renewable hydrogen’s immediate prospects? S&P Global Platts Zane McDonald, Jeff McDonald and Henry Edwardes-Evans discuss projects, prices and policies with a little help from Ryse Hydrogen’s Jo Bamford.
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