The UK could become unlock £70 billion in economic benefits if measures including establishing an early low-carbon hydrogen market are taken, a recent report claims.
‘Sustainability superpower UK’, authored in partnership with Inspired PLC and Prologis, made a case for achieving ‘beyond net zero’ by 2050, which would double the economic advances as achieving ‘near net zero’.
Achieving this could support 654,000 jobs in clean energy industries, an increase of nearly 280,000 compared to the ‘near net zero’ projection of 375,000 jobs.
Furthermore, turning the UK into an exporter of clean energy could generate a further £17 billion a year.
Total economic benefits are estimated at £70.3 billion per year, according to the report.
The May report identified four key enablers in achieving this target, which would also position the UK as a clean energy superpower, rather than a net importer of energy.
The government should actively cultivate the UK hydrogen market
Among these enablers was the argument to create early hydrogen demand through government intervention, rather than allowing the market to evolve naturally.
Dubbing hydrogen as essential in the transition to clean energy thanks to its energy storing capabilities, the report urges the government to advance the market within the next two years, rather than the next ten.
The UK hydrogen strategy, published by the government in 2021, committed to assessing the value for money of blending up to 20% hydrogen into the existing gas network, with a final policy decision due later this year.
‘Sustainability superpower UK’, however, makes a case for public policy to place obligation on all gas suppliers to blend their supplies with a residual amount of hydrogen, starting at 1% nationally from 2025, and increasing to 5% nationally by 2030.
This would catalyse hydrogen demand and in turn, drive a market response on production and supply, and initiate price determination through competitive market forces.
Hydrogen is relied upon as a key energy storage solution
Another enabler identified in the strive for ‘beyond net zero’ was to significantly increase energy storage capacity.
Emphasis was placed on balancing the National Grid’s supply and demand of electricity thanks to the growing share of renewable energy generation.
While ultimately concluding that hydrogen shouldn’t be relied on alone to store energy in an effort to diversify risk by reducing dependency on a single technology, it was acknowledged that hydrogen is positioned as a leading energy storage option.
With further investment and development in this field, hydrogen offers a low-cost solution to store excess from renewable sources that may otherwise be wasted. This energy can then be utilised when renewable energy production is down due to the intermittent nature of wind and solar energy.
Hydrogen, according to the report, seems the most likely option for future energy storage solutions, though it urges the government to fund innovations into alternative solutions to take the reliance off hydrogen alone.
Unique economic opportunities are available
Highlighting the economic opportunity for the UK in clean energy production, the report emphasised the advantage of having an existing national gas infrastructure, for the aforementioned reasons of its hydrogen distribution potential.
Additionally, the report identified key export opportunities. The prediction that international trade could satisfy global hydrogen demand by 2050, combined with the goal to reduce household energy consumption, cultivates the possibility of higher levels of hydrogen and other clean energy exports.
Jason Longhurst, Chair of the UK Business Council for Sustainable Development, describes the economic prospects detailed within the report as a ‘once-in-a-generation economic opportunity’.
He explained: “Unless Britain gets to grips with policymaking, we could squander this great opportunity.
“We need policy which drives delivery in retrofit, accelerates innovation in energy storage and catalyses investment in hydrogen.
“We believe this paper delivers an evidence base to enable our government of the day to drive new incentives to transition, leverage in further private sector investment and position the UK as one of the world’s investable markets for companies to help tackle the challenges created by climate change.”
By calling on the public and private sectors to work together, Jason hopes that decision-makers will grasp the presented opportunity for the UK to take its place on the world stage as a sustainability superpower, and aim for a beyond-net-zero goal.