New funding to drive innovation within the hydrogen sector and accelerate its production and storage has been launched.
The £10 million Hydrogen Innovation Scheme will provide capital support over the next four years . This aims to unlock additional private investment in the technology, and enable new companies to enter the sector.
The first round of funding will target:
- projects that support the low-cost, efficient and sustainable production of renewable hydrogen
- projects that support efficient hydrogen storage and distribution, both within Scotland and for export
- projects that support the efficient integration of hydrogen into our energy system
The scheme is part of a Scottish Government commitment to invest £100 million in hydrogen over the course of this parliament. This is part of a wider £180 million package of investment in emerging energy technologies which will be delivered as set out in our updated Climate Change Plan.
Net Zero & Energy Secretary Michael Matheson said: “Scotland has the resources, the people and the ambition to become a world leader in hydrogen production for both domestic use and for export to Europe.
“The Scottish Government is committed to working with the energy sector to establish hydrogen as an important part of a cleaner, greener energy system, supporting a just transition for the industry both home and abroad.
“Our offshore wind resources, which will increase massively in the coming years, offer huge opportunity for the Hydrogen sector to grow. As set out in our Hydrogen Action Plan, and our clear ambition to have 5GW installed hydrogen production capacity in Scotland by 2030 and 25GW by 2045.
“We are open to the world and actively seeking opportunities to collaborate with international partners. The Hydrogen Innovation Scheme provides important, near-term investment to help the sector develop, diversify and realise it’s potential to support our transition to a net zero economy.”
Andy McDonald, Head of Low Carbon Transition at Scottish Enterprise said: “Scottish Enterprise is collaborating with Scottish Government to develop opportunities in the hydrogen sector in Scotland that will maximise the economic benefits and support energy transition.
“We share the ambition to develop Scotland as a leading hydrogen nation. Innovation is a big part of that as it is at the heart of economic development.
“It is important in an emerging sector like hydrogen that we support Scottish companies and projects now to develop new techniques and technologies which can help us to realise our future ambitions in this sector and to retain as much value and intellectual property in Scotland as possible. Scottish Enterprise is engaged with the Hydrogen Innovation Fund and supporting its implementation.”
Nigel Holmes, Chief Executive Officer of the Scottish Hydrogen and Fuel Cell Association said: “The Hydrogen Innovation Scheme will help Scotland to develop our hydrogen supply chain and build the international partnerships to grow Scottish capacity and export capabilities.
“This is a great opportunity for our manufacturers, innovators, and researchers not yet involved in the hydrogen sector to establish new activities in Scotland.”
John Andresen, Hydrogen Strategic Champion at the Energy Technology Partnership said: “The Energy Technology Partnership is very pleased about the new Scottish Government’s £10 million Hydrogen Innovation Scheme which will foster national technological progress and advance home-grown innovation.
“A key funding route for the green powerhouse of Europe.”
Friends of the Earth Scotland are calling on the Scottish Government to ensure that their new £10million Hydrogen Innovation Fund will not go to companies or projects producing hydrogen from fossil fuels.
The Fund was launched as a separate new report showed 98% of global hydrogen production is from climate-damaging fossil fuels. The research revealed that carbon capture technology, which is intended to catch the pollution created by fossil fuelled hydrogen, was only 60% effective.
This means that fossil fuel-derived hydrogen will still make a huge contribution to climate change and allow companies to greenwash the oil and gas they are extracting from the North Sea.
The announcement is part of a £100million commitment by the Scottish Government to invest in hydrogen over the term of this Parliament.
The report, ‘Hydrogen’s role in Scotland’s climate journey’, which was commissioned by Friends of the Earth Scotland also exposed the inefficiencies, high costs and threat to renewable energy supplies posed by hydrogen.
Key findings from the report:
– Using green hydrogen to meet Scotland’s heating demand would require 180% more renewable energy than Scotland produces currently
– 80% of current renewable energy supplies would be needed to create just 5GW of green hydrogen
– Electric heat pumps can be 168-342% more efficient than hydrogen boilers
– Hydrogen boilers can be 53-68% more expensive than electric heat pumps
– Electric vehicles are more than twice as energy efficient than hydrogen fuel cell vehicles
– Adopting green hydrogen in industry would require nearly twice as much new renewable energy capacity compared to electrification technologies
Scottish Government officials have recently admitted that so-called ‘negative emissions technology’ like CCS and hydrogen would not deliver this decade, leaving a huge gap in its plans to cut climate emissions.
Friends of the Earth Scotland’s Climate Campaigner Alex Lee said: “The Scottish Government must not hand out any more public money for the development of hydrogen from oil and gas, which will produce even more climate pollution and give fossil fuel companies a chance to greenwash their dangerous plans to keep on drilling in the North Sea.
“Producing hydrogen from fossil fuels is an expensive and unnecessary way to clean up our energy system due to its reliance on dodgy technologies like carbon capture and storage which fail to work at the scale its backers claim.
“This approach is far from zero carbon and keeps us locked into the same volatile system of oil and gas which is already unaffordable for millions of people.
“The evidence clearly shows that hydrogen is either made from climate-wrecking fossil fuels or it becomes a huge drain on renewable energy supplies. Hydrogen is a high cost, low efficiency non-solution to our energy needs and the Scottish Government must urgently rethink their plans for its expansion.
“Whether it is in heating or transport, support for hydrogen looks like a losing bet when compared to direct electrification through technology like heat pumps and electric buses.
“By ending support for fossil-hydrogen and prioritising electrification over green hydrogen, the Scottish Government can better protect households from high costs and ensure renewables can clean up our energy system.”
Details on the Hydrogen Innovation Scheme are available on the Scottish Government website.