Policy & Socio-Economics

The Energy Innovation Needs Assessment (EINA) aims to identify the key innovation needs across the UK’s energy system to inform the prioritisation of public sector investment in low-carbon innovation. Using an analytical methodology developed by the Department for Business Energy & Industrial Strategy (BEIS) the EINA takes a system level approach and values innovations in a technology in terms of the system-level benefits a technology innovation provides. This whole system modelling in line with BEIS’s EINA methodology was delivered by the Energy Systems Catapult (ESC) using the Energy System Modelling Environment (ESMETM) as the primary modelling tool.



To support the overall prioritisation of innovation activity the EINA process analyses key technologies in more detail. These technologies are grouped together into sub-themes according to the primary role they fulfil in the energy system. For key technologies within a sub-theme innovations and business opportunities are identified. The main findings at the technology level are summarised in sub-theme reports. An overview report will combine the findings from each sub-theme to provide a broad system-level perspective and prioritisation.



This EINA analysis is based on a combination of desk research by a consortium of economic and engineering consultants and stakeholder engagement. The prioritisation of innovation and business opportunities presented is informed by a workshop organised for each sub-theme assembling key stakeholders from the academic community industry and government.



This report was commissioned prior to advice being received from the CCC on meeting a net zero target and reflects priorities to meet the previous 80% target in 2050. The newly legislated net zero target is not expected to change the set of innovation priorities rather it will make them all more valuable overall. Further work is required to assess detailed implications.

Government has reviewed the evidence base on options for achieving long term heat decarbonisation. This report provides an overview of the key issues arising from our review and seeks to:

• highlight the different characteristics of the main alternative sources of low carbon heat and the approaches to achieving transformational change
• set out strategically important issues ‘strategic inferences’ which we have drawn from the evidence available to help focus the development of our long term policy framework
• identify areas that require further exploration to inform the development of a new long term policy framework for heat

The review confirmed we need:

• better understanding of the different options available for decarbonising heating
• a clearer common agenda across industry academia and the public sector to ensure effort and resources are effectively and efficiently applied to long term heat decarbonisation issues

We welcome your views on:

• the strategic inferences identified
• the priority areas requiring further development
• any important omissions
• the parties best placed to deliver in these areas
• opportunities for enhancing co-ordination

A new assessment tool for evaluating decarbonization technologies that considers each technology’s sustainability security affordability readiness and impact for a specific country is proposed. This tool is applied to a set of decarbonization technologies for the power transport and industry sectors for the ten Southeast Asian countries that constitute ASEAN. This results in a list of the most promising decarbonization technologies as well as the remaining issues that need more research and development. This study reveals several common themes for ASEAN’s decarbonization. First carbon capture and storage (CCS) is a key technology for large-scale CO2 emission. Second for countries that rely heavily on coal for power generation switching to gas can halve their CO2 emission in the power sector and should be given high priority. Third hydropower and bioenergy both have high potential for the majority of ASEAN countries if their sustainability issues can be resolved satisfactorily. Fourth replacing conventional vehicles by electric vehicles is the overarching theme in the road transport sector but will result in increased demand for electricity. In the medium to long term the use of hydrogen for marine fuel and biofuels for aviation fuel are preferred solutions for the marine and aviation transport sectors. Fifth for the industry sector installing CCS in industrial plants should be given priority but replacing fossil fuels by blue hydrogen for high-temperature heating is the preferred long-term solution.

Global maritime transportation is responsible for around 3% of total anthropogenic green‐ house gas emissions and significant proportions of SOx NOx and PM emissions. Considering the predicted growth in shipping volumes to 2050 greenhouse gas emissions from ships must be cut by 75–85% per ton‐mile to meet Paris Agreement goals. This study reviews the potential of a range of alternative fuels for decarbonisation in maritime. A systematic literature review and information synthesis method was applied to evaluate fuel characteristics production pathways utilization technologies energy efficiency lifecycle environmental performance economic viability and cur‐ rent applicable policies. Alternative fuels are essential to decarbonisation in international shipping. However findings suggest there is no single route to deliver the required greenhouse gas emissions reductions. Emissions reductions vary widely depending on the production pathways of the fuel. Alternative fuels utilising a carbon‐intensive production pathway will not provide decarbonisation instead shifting emissions elsewhere in the supply chain. Ultimately a system‐wide perspective to creating an effective policy framework is required in order to promote the adoption of alternative propulsion technologies.

There is a growing conversation around the role that hydrogen can play in the future of the UK and how to best harness its potential to secure jobs show climate leadership promote industrial competitiveness and drive innovation. The Government’s ‘Ten Point Plan for a Green Industrial Revolution’ included hydrogen as one of its ten actions targeting 5GW of ‘low carbon’ hydrogen production by 2030. Britain is thus joining the EU US Japan Germany and a host of other countries seeking to be part of the hydrogen economy of the future.<br/><br/>A focus on clean green hydrogen within targeted sectors and hubs can support multiple Government goals – including demonstrating climate leadership reducing regional inequalities through the ‘levelling up’ agenda and ensuring a green and cost-effective recovery from the coronavirus pandemic which prioritises jobs and skills. A strategic hydrogen vision must be honest and recognise where green hydrogen does not present the optimal pathway for decarbonisation – for instance where alternative solutions are already readily available for roll-out are more efficient and cost-effective. A clear example is hydrogen use for heating where it is estimated to require around 30 times more offshore wind farm capacity than currently available to produce enough green hydrogen to replace all gas boilers as well as adding costs for consumers.<br/><br/>This paper considers the offer of hydrogen for key Government priorities – including an inclusive and resilient economic recovery from the pandemic demonstrating climate leadership and delivering for all of society across the UK. It assesses existing evidence and considers the risks and opportunities and how they might inform a strategic vision for the UK. Ahead of the forthcoming Hydrogen Strategy it sets expectations for Government and outlines key recommendations.

As the world looks to recover from the impact of coronavirus on our lives livelihoods and economies we have the chance to build back better: to invest in making the UK a global leader in green technologies.

The plan focuses on increasing ambition in the following areas:

• advancing offshore wind
• driving the growth of low carbon hydrogen
• delivering new and advanced nuclear power
• accelerating the shift to zero emission vehicles
• green public transport cycling and walking
• ‘jet zero’ and green ships
• greener buildings
• investing in carbon capture usage and storage
• protecting our natural environment
• green finance and innovation

The ten point plan will mobilise £12 billion of government investment and potentially 3 times as much from the private sector to create and support up to 250000 green jobs.

This research qualitatively reviews literature regarding energy system modeling in Japan specific to the future hydrogen economy leveraging quantitative model outcomes to establish the potential future deployment of hydrogen in Japan. The analysis focuses on the four key sectors of storage supplementing the gas grid power generation and transportation detailing the potential range of hydrogen technologies which are expected to penetrate Japanese energy markets up to 2050 and beyond. Alongside key model outcomes the appropriate policy settings governance and market mechanisms are described which underpin the potential hydrogen economy future for Japan. We find that transportation gas grid supplementation and storage end-uses may emerge in significant quantities due to policies which encourage ambitious implementation targets investment in technologies and research and development and the emergence of a future carbon pricing regime. On the other hand for Japan which will initially be dependent on imported hydrogen the cost of imports appears critical to the emergence of broad hydrogen usage particularly in the power generation sector. Further the consideration of demographics in Japan recognizing the aging shrinking population and peoples’ energy use preferences will likely be instrumental in realizing a smooth transition toward a hydrogen economy.

The Northeast Asian Region is a home for the major world’s energy importers and Russia – the top energy exporter. Due to the depletion of national fossil energy resources the industrialised East Asian economies are facing serious energy security issues. The snapshot of the intraregional energy trade in 2019 was analysed in terms of development potential. Japan Korea and China are at the frontline of hydrogen energy technologies commercialisation and hydrogen energy infrastructure development. The drivers for such endeavours are listed and national institutions for hydrogen energy development are characterised. The priorities related to regional cooperation on hydrogen energy in Northeast Asia were derived on the basis of hydrogen production cost estimations. These priorities include steady development of international natural gas and power infrastructure. The shared process will lead to the synergy of regional fossil and renewable resources within combined power and hydrogen infrastructure.

Growing prosperity among its population and an inherent increasing demand for energy complicate China’s target of combating climate change while maintaining its economic growth. This paper therefore describes three potential decarbonization pathways to analyze different effects for the electricity transport heating and industrial sectors until 2050. Using an enhanced version of the multi-sectoral open-source Global Energy System Model enables us to assess the impact of different CO2 budgets on the upcoming energy system transformation. A detailed provincial resolution allows for the implementation of regional characteristics and disparities within China. Conclusively we complement the model-based analysis with a quantitative assessment of current barriers for the needed transformation. Results indicate that overall energy system CO2 emissions and in particular coal usage have to be reduced drastically to meet (inter-) national climate targets. Specifically coal consumption has to decrease by around 60% in 2050 compared to 2015. The current Nationally Determined Contributions proposed by the Chinese government of peaking emissions in 2030 are therefore not sufficient to comply with a global CO2 budget in line with the Paris Agreement. Renewable energies in particular photovoltaics and onshore wind profit from decreasing costs and can provide a more sustainable and cheaper energy source. Furthermore increased stakeholder interactions and incentives are needed to mitigate the resistance of local actors against a low-carbon transformation.

Although electricity supply is still dominated by fossil fuels it is expected that renewable sources will have a much larger contribution in the future due to the need to mitigate climate change. Therefore this paper presents a new framework for developing Future Electricity Scenarios (FuturES) with high penetration of renewables. A multi-period linear programming model has been created for power-system expansion planning. This has been coupled with an economic dispatch model PowerGAMA to evaluate the technical and economic feasibility of the developed scenarios while matching supply and demand. Application of FuturES is demonstrated through the case of Chile which has ambitious plans to supply electricity using only renewable sources. Four cost-optimal scenarios have been developed for the year 2050 using FuturES: two Business as usual (BAU) and two Renewable electricity (RE) scenarios. The BAU scenarios are unconstrained in terms of the technology type and can include all 11 options considered. The RE scenarios aim to have only renewables in the mix including storage. The results show that both BAU scenarios have a levelised cost of electricity (LCOE) lower than or equal to today’s costs ($72.7–77.3 vs $77.6/MWh) and include 81–90% of renewables. The RE scenarios are slightly more expensive than today’s costs ($81–87/MWh). The cumulative investment for the BAU scenarios is $123-$145 bn compared to $147-$157 bn for the RE. The annual investment across the scenarios is estimated at $4.0 ± 0.4 bn. Both RE scenarios show sufficient flexibility in matching supply and demand despite solar photovoltaics and wind power contributing around half of the total supply. Therefore the FuturES framework is a powerful tool for aiding the design of cost-efficient power systems with high penetration of renewables.