Hydrogen’s big bet: hot air or the holy grail of net zero? | Energy industry
SStanding in front of a lime green hydrogen double-decker bus, Jo Bamford posed for a photo alongside Transport Secretary Anne-Marie Trevelyan during the ‘hydrogen zone’ of the Conservative Party Conference in Birmingham.
A week earlier, heir JCB’s team were busy with photocalls featuring Labor heavyweights Keir Starmer, Rachel Reeves and Ed Miliband at the Labor conference in Liverpool.
The political offensive was emblematic of the Bamford dynasty’s close political ties and the hydrogen industry’s eagerness to foster goodwill in Westminster. Companies such as Cadent, National Grid, Centrica and boilermaker Worcester Bosch have joined Bamford firms Ryze Hydrogen and Wrightbus in trying to convince Labor and Tory MPs that hydrogen, the emission-free and highly combustible gas, can be a precious weapon in the fight against the climate crisis. .
Bamford’s political connections are well known: his billionaire father Anthony is a big donor to the Conservative Party, mainly through JCB. The peer helped pay for Boris Johnson’s wedding celebrations and the former prime minister even agreed free accommodation for his family from Lord Bamford’s wife Carole last month.
Johnson smashed a polystyrene wall in a JCB excavator bearing the slogan “Get Brexit done” in 2019 and earlier this year visited its production plant in India.
Ever since Jo Bamford bought bankrupt London bus maker Wrightbus in 2019, the grandson of JCB founder Joseph Cyril Bamford has been betting big on hydrogen. It has won several taxpayer-funded contracts for green transport, including an £11.2 million contract to develop hydrogen fuel cell technology in Northern Ireland. Last year he launched HyCap, a £1bn investment fund designed to support hydrogen specialists, from producers to filling stations and transport companies.
Bamford is far from alone in cultivating cordial relations with the government. There are at least 120 paid hydrogen lobbyists currently operating in parliament, according to estimates by the MCS Charitable Foundation. Across the EU, an extensive network of fossil fuel companies, trade associations and other interested parties are advocating for hydrogen.
Their goals are disparate, from securing support and subsidies to decarbonise energy-intensive industries to convincing authorities to switch to heating homes with hydrogen boilers. Hydrogen is seen as a transition fuel to a future powered by renewables such as wind and solar, allowing existing gas lines to be used to pump the gas.
But the march of the hydrogen lobby has raised many questions – how much will it cost, are there more affordable ways to achieve zero emissions, and interests such as the oil industry are trying – are they simply to avoid extinction?
“Green” hydrogen is produced by separating water using electricity from renewable energy, with minimal emissions. However, critics claim that creating green hydrogen for home heating is six times less energy efficient than using heat pumps powered by electricity. Meanwhile, “blue” methods for producing the gas from fossil fuels require the carbon dioxide released to be captured and stored to avoid emissions. However, this depends on the success of the unproven carbon capture and storage industry, which is in its infancy. Last year, the chief executive of the hydrogen lobby group resigned, saying he could no longer lead an association including oil companies backing blue hydrogen projects because the programs were “unsustainable ‘ and ‘didn’t make sense’.
Although the Climate Change Committee (CCC), which advises the government, considers the element – the most abundant in the universe – Playing a significant role in the UK’s transition to net zero, there is fierce debate over which industries and in what form and quantities it should be employed.
The hard work of industry champions appears to be paying off: hydrogen has been mentioned 402 times in parliament so far this year and 595 in 2021, compared to 392 in 2019 and just 18 times in 2015.
Earlier this year, the government doubled its production target to 10 gigawatts by 2030. Significant public funds have been funneled into exploratory hydrogen projects. In May, a £240m Net Zero Hydrogen fund was launched “to reduce investment risk and reduce lifetime production costs”.
In the same month, the Commercial Department awarded £60m to 28 UK projects as part of its HySupply 2 competition. They included £9.2m to enable ITM Power of South Yorkshire to build a battery of 5 megawatt electrolyzers, which separates hydrogen from oxygen in water using electricity, while Cadent Gas has landed £296,174 to look at how to purify hydrogen that has passed through the grid gas to make it suitable for use in vehicles such as trucks.
In his ‘growth plan’ that caused market mayhem, former Chancellor Kwasi Kwarteng identified five hydrogen projects he hoped to accelerate, including Cadent’s HyNet program to build the world’s first 100% pipeline network. hydrogen from the UK in the North West.
The Hydrogen All Party Parliamentary Group (APPG) was established in 2018 and is chaired by Conservative MP Jacob Young. APPGs are informal cross-party groups that have no formal status in parliament and have in the past raised concerns about conflicts of interest.
The Hydrogen APPG, which until recently had Lord Bamford among its members, is funded by a group of major energy producers, network operators and boilermakers, including Shell, EDF, Cadent, Bosch and the industrial Johnson Matthey.
In July, Johnson Matthey leader Jane Toogood was named Britain’s ‘hydrogen champion’, with the task of ‘bringing together industry and government to deliver the government’s hydrogen ambitions’. “. Three months earlier, the government took out a £400million loan from Johnson Matthey to research sustainable technologies. There is no suggestion of wrongdoing in any of the contracts mentioned in this article.
The appeal of hydrogen for companies with existing gas infrastructure and natural gas investments is clear. They fear that their assets will become ‘stranded’, rapidly devalued by the shift away from fossil fuels.
It’s not just the companies themselves pushing the cause. The right-wing think tank the Center for Policy Studies, of which Lord Bamford is a board member, held a side event at the Conservative Party Conference attended by Business Secretary Jacob Rees-Mogg and argued that Britain could “lead the world in hydrogen”.
The Institute of Economic Affairs, which has close ties to Liz Truss, argued that there is “still a lack of policies to create demand for hydrogen”.
Michael Liebreich, president of Liebreich Associates and founder of analyst firm Bloomberg New Energy Finance, said: “I see this as a two-way bet for fossil fuel companies – either they receive hydrogen subsidies or they delay the process, then we’re dependent on fossil fuels for longer.
The use of hydrogen for heating homes is also hotly debated. Later this month, the APPG will host a session on whether hydrogen-ready boilers are the answer to decarbonising homes, with speakers from Scottish gas distributor SGN and boilermaker Vaillant.
Liebreich, speaking after giving a keynote speech at the World Hydrogen Congress in Rotterdam last week, said: “Gas network companies want to get public funds and money through utility bills. households to upgrade the grid, but no one is talking about the fact that switching 24 million homes will take decades and decades. And during that time, we will have lost time to accelerate the deployment of heat pumps, which alone will work. »
According to Liebreich, even conservative estimates of the cost of converting infrastructure and devices to hydrogen amount to £171 billion to cover the whole of the UK. There are also concerns that “embrittlement”, caused when hydrogen weakens pipes, could cause leaks.
Liebreich argues that even in a system that mixes hydrogen and natural gas, the environmental gains of using hydrogen are far outweighed by using green electricity in other ways, such as power. cars or the steel industry.
The Guardian revealed last month that a closely watched project to build a new hydrogen grid for 300 homes in Scotland was struggling to get off the ground.
CCC member Julia King said: “If the UK wants a growth strategy, hydrogen could be a part of it that it should support. We are going to need hydrogen to decarbonize heavy industry. The jury is out on transportation as there are options with electric, although for very long distances we may need hydrogen.
“The biggest question mark is around home heating: there is growing evidence that it is not cost effective or energy efficient to use hydrogen.”
A spokesperson for Johnson Matthey said the company “sees the advancement of hydrogen technologies as a critical enabler to achieving global decarbonization goals, and we are proud to support the APPG on the hydrogen activities”.