Hydrogen UK Supply Chains Report Executive Summary 2023

The strategic importance of hydrogen has gained significant recognition as nations across the world have committed to achieving net zero. Here in the UK, there’s a widespread consensus that hydrogen is critical to achieving our net zero target. This commitment culminated in the launch of the UK’s first Hydrogen Strategy and has been reaffirmed by Chris Skidmore’s Independent Review of Net Zero. Both these documents highlight hydrogen’s importance not only to net zero but growing the UK industrial base1 . Analysis by Hydrogen UK estimates up to 20,000 jobs could be created by 2030, contributing £26bn in cumulative GVA2. These economic benefits flow from all areas of the value chain ranging from production, storage, network development and off-taker markets. However, with large scale projects still to take final investment decisions, current volumes of low-carbon hydrogen produced and consumed fall well below the government’s 2030 ambitions. Encouragingly the UK has a positive track record of deploying low carbon technologies. The combination of the UK’s world leading policies and incentive schemes, alongside our vibrant RD&I and engineering environment, has enabled rapid deployment of technologies like offshore wind and electric vehicles. Yet despite being world leaders in deployment, early opportunities for regional supply chain growth and job creation were not fully realised and taken advantage of from inception. The hydrogen sector is therefore at a tipping point. To capitalise on the economic opportunity hydrogen offers, the UK must learn from prior technology deployments and build a strong domestic hydrogen supply chain in parallel to championing deployment. This report delivers on a recommendation from the Hydrogen Champion Report which encouraged industry to create an industry led supply chain strategy3 . With Hydrogen UK steering the work on behalf of the UK hydrogen industry, this study focusses on identifying the actions needed to mature a local supply chain that can support the initial deployment of hydrogen technologies across the value chain. The report is segmented into two sections. The first section outlines a voluntary ambition for local content from industry alongside the potential intervention mechanisms needed to achieve the ambition. The second section exploresthe challenges companies across the hydrogen value chain face in maximising UK supply chain opportunities.
This report can be found on Hydrogen UK's website.