New report shows UK is at critical juncture in maximising industrial potential of green hydrogen

A report published by RenewableUK urges the Government to work closely with the green hydrogen industry to develop a new market big enough to grow new supply chains and kickstart a major new green energy industry at scale in the UK.

The report, entitled “Surveying the UK’s Green Hydrogen Supply Chain Capability” warns that the UK stands at a critical juncture, with other countries taking steps to overtake us in the global race to create thousands of jobs and attract billions in private investment in green hydrogen in the decades ahead.

The Government has set a target of 10GW of low carbon hydrogen by 2030, at least half of which will be green hydrogen. To reach this target, the recommendations set out in the report include building multiple large-scale projects as soon as possible to demonstrate that there is a viable market for investors and suppliers.

Government support schemes, such as the Hydrogen Business Model and the Net Zero Hydrogen Fund, will play key roles in this, so their roll-out needs to be speeded up. Ensuring that contracts are finalised and awarded in time, and that future funding allocation rounds up to 2030 are clarified, will be vital for developers.

If the UK does not step up, it risks being left behind due to ambitious tax incentives and subsidies offered abroad, such as the United States Inflation Reduction Act, which may attract investment and prospective suppliers away from this country. 

The report recommends that Ministers should consider consulting with the industry and setting up a joint working group to establish how tax incentives and other financial institutions, such as the UK Infrastructure Bank, could be used to make the UK a more competitive market for investment in the green hydrogen supply chain.

RenewableUK’s Senior Policy Analyst for Emerging Technologies Laurie Heyworth said: “The UK has the potential to become a global leader in green hydrogen. We’re at a pivotal moment at which we can take decisive strategic action, enabling us to seize the opportunity to deliver growth and jobs by developing robust local supply chains in the burgeoning green hydrogen industry, creating opportunities to export our technology worldwide”.

“This report sets out how these issues can be addressed, with industry and Government working together to maximise the economic and environmental benefits which this innovative technology offers”.

Read the full report here.