A recent meeting between the UK’s Minister of State for Energy and Climate, the CEO of UK Oil & Gas (UKOG) and subsidiary UK Energy Storage (UKEn) emphasised the necessity of accelerating energy storage systems while continuing to focus on the connections between natural gas and hydrogen as a solution to the existing energy challenges and to support a low carbon transition.
Stephen Sanderson, the CEO of UKOG, explained that while there is a need for more energy storage in the UK, both natural gas and hydrogen remain a vital part of the solution to the energy crisis and our future energy independence. The business referred to the delivery of the storage facility in Portland, when complete, would double the UK’s onshore storage capacity and be capable of handling hydrogen and natural gas.
While hydrogen has made good progress in Europe as a solution to substitute natural gas from hard-to-abate industries, Offshore Energy wrote in a recent report that we cannot solely rely on hydrogen to achieve net-zero emission reductions by 2050, but will prove critical in selected sectors.
In the current energy and climate crisis, hydrogen’s ability to substitute gas as a priority in the decarbonisation strategy has become a priority. However, the existing situation in Europe was recently highlighted by the EC Executive VP Frans Timmermans, stating that gas will likely remain a transition fuel for many industries and regions. Bureau Veritas emphasised hydrogen can only reach its full potential if a carbon-free value chain for generation, storage, distribution and use is secured. The whitepaper discusses that new investment from governments and banks needs to increase, as an investment of over $1 trillion in low-carbon hydrogen funding is required to achieve net zero emissions by 2050. The cost of hydrogen production must decline to ensure the solution becomes more competitive. Bureau Veritas believes that the cost of green hydrogen production could reduce by 30% by 2030 if hydrogen production accelerates and the price of renewable energy declines.
Despite the challenges, Bureau Veritas concludes that hydrogen has a significant role in supporting industry leaders to decarbonise their activities. This follows the opinions of the Hydrogen Council, which claims that hydrogen is a vital part of our energy future and should be considered a global energy solution. Furthermore, Bureau Veritas emphasises that specialist training will become critical for professionals across multiple industries to support hydrogen technology development.
With hydrogen regarded as the fuel of the future, investments in the hydrogen industry have increased recently. According to Bureau Veritas, technological progress is driving the industry forward. This includes carbon capturing, large-scale production and electrolysers. Bureau Veritas also highlighted that the increase of ESG is a critical factor in the rise of hydrogen, as this plays a vital role in 2023 ESG strategies. Businesses focused on reducing their carbon footprint will look towards hydrogen.