Role of Hydrogen in UK energy system


Hydrogen is already entering the energy system and appears to be a convincing pathway to decarbonise heat and transport. Its widespread use requires deliberate intervention, which includes a strategic, long-term plan to make hydrogen zero-carbon and to address challenges, including its impact on energy security.

The biggest challenges are where large volumes of hydrogen will come from and how to decarbonise it. The report highlights concerns around the associated costs and deliverability of the necessary steam methane reforming plant and Carbon Capture and Storage (CCS) infrastructure needed to handle the large volumes of CO2.

Natural gas will be used to produce a majority of the hydrogen, as it is cheaper than from electricity, but residual emissions from CCS and hydrocarbon extraction are significant and will need to be addressed. Surplus electricity from wind will produce only a small fraction of the hydrogen needed for heat: meeting this demand with electricity alone would require about 70 GW of additional nuclear capacity – seven times current capacity.

Replacing natural gas with hydrogen for heating will increase gas consumption and produce more CO2. Some of the increase could be offset by measures to reduce energy demand for heat. Blending into the gas supply provides little carbon reduction, even at high blends, and would be expensive, so switching has to be done by area and straight to 100% hydrogen.

Imports of natural gas mean most of the upstream emissions from extraction are likely to be outside the UK. This may be an issue for meeting global climate targets set out in the Paris Agreement.

Zero-carbon hydrogen could be imported from sunny regions, such as North Africa, using very-high temperature solar thermal. But these are unlikely to be available to meet early bulk demand.

Hydrogen is already playing a valuable, diffuse role in the energy system and helping to manage the electricity grid, fuel vehicle fleets and industry. These niche applications can develop without hydrogen from natural gas, but will benefit from removing regulatory and market barriers to help them become viable.


  1. Enable early, stand-alone, hydrogen technologies.
    • Remove regulatory barriers to enable diffuse use of hydrogen.
  1. Plan for large-scale use of hydrogen to address carbon emissions and energy security implications. The following are needed if hydrogen is used widely in heat and transport:
    • Long-term strategic plan for zero-carbon hydrogen.
    • CCS built before 2030, to enable large-scale use of hydrogen.
    • Assess energy security implications of import dependency.
    • Insulate buildings to a high standard, to offset increases in gas consumption.
    • Early engagement with publics will be essential.
    • Evaluate need and locations of large-scale hydrogen storage.
    • Clear signal to enable investment by developers and equipment providers.
    • Robust understanding of safety, with meaningful regulation.
  1. Whole system approach to hydrogen, to evaluate potential in the energy system.
    • Whole system, sustainability criteria should be used to evaluate the benefits
    • Realise cross-sector benefits to reduce costs and improve efficiencies.
  1. Support UK industry and expertise to capitalise on emerging global markets.
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Follow-up activities

This report leads into ERP’s project on the transition to low-carbon heat.

Steering Group

  • Prof Neville Jackson – Ricardo (Chair)
  • Den Gamer – ETI
  • Peter Bance – Origami Investments

The project consulted widely with industry and academia and draws on a large number of published reports and papers.

Further information

Please contact Richard Heap from the ERP Analysis Team.

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