Foresight Group invited investors, utilities companies and developers – as well as New Private Markets – to its Hydrogen Horizons event on Wednesday. The afternoon featured panels on the future of the hydrogen market, as well as a keynote speech from UK Minister for Energy Efficiency Martin Callanan. Some takeaways from the discussions:
Callanan was clear that hydrogen will play a key role in the future of the UK power. The UK government is hoping to unlock £11 billion ($13.9 billion; €12.9 billion) of private investment in the space by 2030. It launched its clean hydrogen strategy in 2021, before updating it last year.
He said: “Make no mistake, low carbon hydrogen will need to be a key part of the UK’s future energy system. It will be a source of clean energy which we can produce domestically using British skills experience and some of our fantastic natural resources as well as helping us to support UK energy independence. It will be critical to helping many vital current British industries transition away from expensive oil and gas and can provide cleaner, greener energy for power and transport and all the other use cases that we can explore afterwards. The UK’s geography, its geology, its infrastructure and its expertise in my view make it particularly suited to rapidly developing that low carbon hydrogen economy.”
Countries are taking different approaches to integrating hydrogen into their power supplies, said Anise Ganbold, head of global energy markets at analytics company Aurora. The UK, for example, is “really pushing towards the supply side, getting the blue hydrogen and the green hydrogen up and running and then doing the transport and storage and the demand of it later”. On the other hand, countries such as the Germany and the Netherlands are focussing on all elements of the value chain with the intention of “getting everything aligned at the same exact time”.
Germany is sometimes considered to be leading the way in hydrogen implementation, but it is “very difficult to say” whether this is the case, said Alexander Voigt, co-founder of German energy supplier HH2E. In his view Germany, like many other jurisdictions, is yet to stimulate the private investment needed.
“What is still missing is the insight that the enormous volumes of money that we need to invest in infrastructure cannot come from subsidies, they cannot come from state funded programmes or whatever. This is all toy money,” he said.
Work to do
Despite the progress being made, Hydrogen is unlikely to become an internationally traded commodity by the end of the decade, according to David Parkin, director at clean energy company Progressive Energy. This is because the price of hydrogen is unlikely to be in line with comparable commodities such as natural gas, and the infrastructure needed to get hydrogen to users will not be in place. However, derivatives of hydrogen such as ammonia are likely to be traded as commodities, suggested Olivier Mussat, CEO at fertiliser company Atome.