Policy & Socio-Economics

Seizing the clean growth opportunity. The move to cleaner economic growth is one of the greatest industrial opportunities of our time. This Strategy will ensure Britain is ready to seize that opportunity. Our modern Industrial Strategy is about increasing the earning power of people in every part of the country. We need to do that while not just protecting but improving the environment on which our economic success depends. In short we need higher growth with lower carbon emissions. This approach is at the heart of our Strategy for clean growth. The opportunity for people and business across the country is huge. The low carbon economy could grow 11 per cent per year between 2015 and 2030 four times faster than the projected growth of the economy as a whole. This is spread across a large number of sectors: from low cost low carbon power generators to more efficient farms; from innovators creating better batteries to the factories putting them in less polluting cars; from builders improving our homes so they are cheaper to run to helping businesses become more productive. This growth will not just be seen in the UK. Following the success of the Paris Agreement where Britain played such an important role in securing the landmark deal the transition to a global low carbon economy is gathering momentum. We want the UK to capture every economic opportunity it can from this global shift in technologies and services.<br/>Our approach to clean growth is an important element of our modern Industrial Strategy: building on the UK’s strengths; improving productivity across the country; and ensuring we are the best place for innovators and new businesses to start up and grow. A good example of this is offshore wind where costs have halved in just a few years. A combination of sustained commitment – across different Governments – and targeted public sector innovation support harnessing the expertise of UK engineers working in offshore conditions and private sector ingenuity has created the conditions for a new industry to flourish while cutting emissions. We need to replicate this success in sectors across our economy. This Strategy delivers on the challenge that Britain embraced when Parliament passed the Climate Change Act. If we get it right we will not just deliver reduced emissions but also cleaner air lower energy bills for households and businesses an enhanced natural environment good jobs and industrial opportunity. It is an opportunity we will seize.

Low-carbon gases are indispensable to any energy system that is reliable clean affordable safe and is suited to spatial integration and zero-carbon hydrogen is a crucial link in that chain1. The most common element in the universe seems to have a highly bonding effect in the Netherlands – particularly as a result of the unique starting position of our country. This is made clear in the agreements of the National Climate Agreement which includes an ambitious target for hydrogen supported by a large and broad group of stakeholders. Industrial clusters and ports regard hydrogen as an indispensable part of their future and sustainability strategy. For the transport sector hydrogen (in combination with fuel cells) is crucial to achieving zero emissions transport. The agricultural sector has identified opportunities for the production of hydrogen and for its use. Cities regions and provinces are keen to get started on implementing hydrogen.<br/>The government embraces these targets and recognises the power of the framework for action demonstrated by so many parties. The focus on clean hydrogen in the Netherlands will lead to the creation of new jobs improvements to air quality and moreover is crucial to the energy transition.

The hourly operation of Thermal Hydrogen electricity markets is modelled. The economic values for all applicable chemical commodities are quantified (syngas ammonia methanol and oxygen) and an hourly electricity model is constructed to mimic the dispatch of key technologies: bi-directional power plants dual-fuel heating systems and plug-in fuel-cell hybrid electric vehicles. The operation of key technologies determines hourly electricity prices and an optimization model adjusts the capacity to minimize electricity prices yet allow all generators to recover costs. We examine 12 cost scenarios for renewables nuclear and natural gas; the results demonstrate emissionsfree ‘energy-only’ electricity markets whose supply is largely dominated by renewables. The economic outcome is made possible in part by seizing the full supply-chain value from electrolysis (both hydrogen and oxygen) which allows an increased willingness to pay for (renewable) electricity. The wholesale electricity prices average $25–$45/ MWh or just slightly higher than the assumed levelized cost of renewable energy. This implies very competitive electricity prices particularly given the lack of need for ‘scarcity’ pricing capacity markets dedicated electricity storage or underutilized electric transmission and distribution capacity.

This report summarises key themes emerging from the Energy Technologies Institute’s (ETI) project ‘Enabling efficient networks for low carbon futures’. The project aimed to explore the options for reforming the governance and regulatory arrangements to enable major changes to and investment in the UK’s energy network infrastructures. ETI commissioned four expert perspectives on the challenges and options facing the UK.

This paper proposes that whilst the exact pathway to decarbonising heat in the UK is not yet clear there are a range of actions that could be taken in the next ten years to shift heat onto the right route to meet our 2050 net zero obligation. We already possess many of the skills and technologies required but there are a number of significant barriers preventing a spontaneous movement towards low carbon heat on the scale required – a starting impulse is needed.<br/><br/>Energy efficiency and low carbon heating have the potential to radically improve the quality of life of not just the poorest in our society but all residents of the United Kingdom. With the right approach the decarbonisation of heat can improve health outcomes for millions create new jobs in manufacturing and construction reduce air pollution in our cities and reduce the burden on our health service. This in addition to leading the world in mitigating the climate emergency.

Hydrogen has emerged as an important part of the clean energy mix needed to ensure a sustainable future. Falling costs for hydrogen produced with renewable energy combined with the urgency of cutting greenhouse-gas emissions has given clean hydrogen unprecedented political and business momentum.



This paper from the International Renewable Energy Agency (IRENA) examines the potential of hydrogen fuel for hard-to-decarbonise energy uses including energy-intensive industries trucks aviation shipping and heating applications. But the decarbonisation impact depends on how hydrogen is produced. Current and future sourcing options can be divided into grey (fossil fuel-based) blue (fossil fuel-based production with carbon capture utilisation and storage) and green (renewables-based) hydrogen. Green hydrogen produced through renewable-powered electrolysis is projected to grow rapidly in the coming years.



Among other findings:



Important synergies exist between hydrogen and renewable energy. Hydrogen can boost renewable electricity market growth and broaden the reach of renewable solutions.

• Electrolysers can add demand-side flexibility. In advanced European energy markets electrolysers are growing from megawatt to gigawatt scale.
• Blue hydrogen is not inherently carbon free. This type of production requires carbon-dioxide (CO2) monitoring verification and certification.
• Synergies may exist between green and blue hydrogen deployment given the chance for economies of scale in hydrogen use or logistics.
• A hydrogen-based energy transition will not happen overnight. Hydrogen use is likely to catch on for specific target applications. The need for new supply infrastructure could limit hydrogen use to countries adopting this strategy.
• Dedicated hydrogen pipelines have existed for decades and could be refurbished along with existing gas pipelines. The implications of replacing gas abruptly or changing mixtures gradually should be further explored.

Trade of energy-intensive commodities produced with hydrogen including “e-fuels” could spur faster uptake or renewables and bring wider economic benefits.

In an integrated energy system hydrogen can support the decarbonisation of industry transport power generation and buildings across Europe. The EU Hydrogen Strategy addresses how to transform this potential into reality through investments regulation market creation and research and innovation.

Hydrogen can power sectors that are not suitable for electrification and provide storage to balance variable renewable energy flows but this can only be achieved with coordinated action between the public and private sector at EU level. The priority is to develop renewable hydrogen produced using mainly wind and solar energy. However in the short and medium term other forms of low-carbon hydrogen are needed to rapidly reduce emissions and support the development of a viable market.

This gradual transition will require a phased approach:

• From 2020 to 2024 we will support the installation of at least 6 gigawatts of renewable hydrogen electrolysers in the EU and the production of up to one million tonnes of renewable hydrogen.
• From 2025 to 2030 hydrogen needs to become an intrinsic part of our integrated energy system with at least 40 gigawatts of renewable hydrogen electrolysers and the production of up to ten million tonnes of renewable hydrogen in the EU.
• From 2030 to 2050 renewable hydrogen technologies should reach maturity and be deployed at large scale across all hard-to-decarbonise sectors.
• To help deliver on this Strategy the Commission is launched the European Clean Hydrogen Alliance with industry leaders civil society national and regional ministers and the European Investment Bank. The Alliance will build up an investment pipeline for scaled-up production and will support demand for clean hydrogen in the EU.

To target support at the cleanest available technologies the Commission will work to introduce common standards terminology and certification based on life-cycle carbon emissions anchored in existing climate and energy legislation and in line with the EU taxonomy for sustainable investments. The Commission will propose policy and regulatory measures to create investor certainty facilitate the uptake of hydrogen promote the necessary infrastructure and logistical networks adapt infrastructure planning tools and support investments in particular through the Next Generation EU recovery plan.

Outline

This is the eighth annual Progress Report to the Scottish Parliament required by Scottish Ministers under the Climate Change (Scotland) Act 2009. It assesses Scotland’s progress in achieving its legislated targets to reduce greenhouse gas emissions

Overall greenhouse gas emissions reduced by 3% in 2017 compared to a 10% fall in 2016. The fall was again led by the power sector due in large part to Scotland’s first full year of coal-free electricity generation. Recent performance in other sectors shows only incremental improvement at best and unless emissions reductions are delivered economy-wide Scotland is at risk of missing its new interim target of a 56% reduction in emissions by 2020.

Key findings

Setting a net-zero greenhouse gas emissions target for 2045 represents a step-change in ambition for Scotland.

The Scottish Parliament’s 2030 target to reduce emissions by 75% will be extremely challenging to meet. It must be backed up by steps to drive meaningful emissions reductions immediately.

Scotland’s Programme for Government 2019-20 alongside other recent policies sent a clear signal that the Scottish Government is taking its more ambitious targets seriously but there is much more to do.

Scotland’s ability to deliver its net-zero target is contingent on action taken in the UK and vice versa.

The National Hydrogen Roadmap provides a blueprint for the development of a hydrogen industry in Australia.

Recently there has been a considerable amount of work undertaken (both globally and domestically) seeking to quantify the economic opportunities associated with hydrogen. The National Hydrogen Roadmap takes that analysis a step further by focusing on how those opportunities can be realised.

National Hydrogen Roadmap

The National Hydrogen Roadmap provides a blueprint for the development of a hydrogen industry in Australia.

The primary objective of the Roadmap is to provide a blueprint for the development of a hydrogen industry in Australia. With a number of activities already underway it is designed to help inform the next series of investment amongst various stakeholder groups (e.g. industry government and research) so that the industry can continue to scale in a coordinated manner.

Pathways to an economically sustainable industry

The low emissions hydrogen value chain now consists of a series of mature technologies. While there is considerable scope for further R&D this level of maturity has meant that the narrative has shifted from one of technology development to market activation.

Barriers to market activation stem from a lack of supporting infrastructure and/or the cost of hydrogen supply. However both barriers can be overcome via a series of strategic investments along the value chain from both the private and public sector.

The report shows that while government assistance is needed to kick-start the industry it can become economically sustainable thereafter. This is demonstrated by first assessing the target price of hydrogen needed for it be competitive with other energy carriers and feedstocks. Second the assessment considers the current state of the industry namely the cost and maturity of the underpinning technologies and infrastructure. It then identifies the material cost drivers and consequently the key priorities and areas for investment needed to make hydrogen competitive in each of the identified markets.

The opportunity for hydrogen to compete favourably on a cost basis in local applications such as transport and remote area power systems is within reach based on potential cost reductions to 2025. Further the development of a hydrogen export industry represents a significant opportunity for Australia and a potential 'game changer' for the local industry and the broader energy sector due to associated increases in scale."

You can read the full report on the CSIRO website at this link

New vehicle technologies and fuels will drive the future of road transport in Australia. Increased availability of battery electric vehicles hydrogen fuel cell vehicles biofuels and associated recharging and refuelling infrastructure will:

• give consumers more choice
• provide productivity emissions reduction fuel security and air quality benefits

Our Future Fuels Strategy: Discussion Paper sets out the direction and practical actions to enable the private sector to commercially deploy low emissions road transport technologies at scale."