Yahoo Finance Will using hydrogen mean bigger bills?
Hydrogen could account for a third of energy use by 2050, the Government has said as it publishes a strategy for boosting use of the low carbon fuel.
Here are some key questions answered.
– What is hydrogen?
It is a versatile gas that can be used as a fuel source in boilers, turbines or vehicle engines, can be transported and stored – including on a large scale – and as it produces only water as a by-product, it is a very clean fuel.
– Could hydrogen replace gas in the boiler in my home?
It is one of the potential options for cleaning up home heating, a big source of climate emissions, and initially hydrogen could be blended in with gas to reduce pollution without having to swap out your boiler.
But that will only go so far, and you would need 100% hydrogen in the grid to fully cut climate emissions, so the Government has plans for trialling this, with potentially a whole town converted to full hydrogen heating by 2030.
If you buy a new boiler after 2026, there are also proposals to make them “hydrogen ready”, so that they could make the switch to the new fuel if the grid in your area was changed over.
But decisions on the role of hydrogen in heating are still several years away, and it will not be playing much of a role in home heating by 2030, with more work needed to test the costs, benefits, safety and feasibility of using it.
Experts warn hydrogen needs to be reserved for the areas where there are few alternatives, such as heavy industry or shipping, and the focus for homes should be on options such as energy efficiency and heat pumps for homes.
– So what is the plan for hydrogen?
The Government has set out ambitions to deliver five gigawatts (GW) of production capacity by 2030, which it says would be able to produce the equivalent amount of hydrogen to heat three million homes and provide clean fuel for industrial processes, power, shipping, HGV lorries and trains.
It would create 9,000 jobs, generate £900 million for the economy, save millions of tonnes of carbon dioxide and open up export opportunities by 2030, the Government says – with the potential for the sector to provide 100,000 jobs and generate £13 billion by 2050.
– If it is so good, why aren’t we using it already?
We already use it in some industrial processes, and for trucks, buses and marine vessels in the UK, and it will soon be blended with natural gas to be supplied to 650 homes in Winlaton, a village in north-east England.
It needs to be manufactured, which can be done in two ways: using electricity from renewables, which makes it zero emissions or “green” hydrogen, or a cheaper but less clean option which uses natural gas.
This second way, known as “blue hydrogen”, produces carbon emissions, most but not all of which can be captured with technology and stored underground.
There are a number of projects which are developing these two routes, but hydrogen is currently significantly more expensive than fossil fuels.
So a key part of the Government’s strategy is to pay producers subsidies to close the gap between the cost of production and what they can sell their hydrogen for to compete with fossil fuels, to drive down costs.
– Will that push up bills?
Potentially. Subsidies for new technology such as offshore wind went on to consumer electricity bills and the Government is considering a similar approach for hydrogen.
Hydrogen has a number of end users and would be replacing different fuels such as diesel in vehicles or natural gas in power and industry, so would have impacts on different sectors and consumers.
How to pay for the transition to clean energy, and who bears the cost, is a key focus of the Government at the moment.
