Councils risk snuffing out hopes for hydrogen

A decision on hydrogen’s role in decarbonising heat is not expected for another four years but gas operator Cadent is using the time to work with local authorities to understand their need for green gas in the future and ensure no options are closed off.

By the time the government makes its decision on what the role of hydrogen will be in the decarbonisation of heating in the UK, decisions could have been made at a local level that prevent it even being an option.

That’s why Cadent, which owns 50% of the natural gas network, is working with local authorities to help determine how much is likely to be required and what steps need to be taken in the coming years to ensure the green gas can still be an option in the future.

Ensuring resilience

Although it is to be expected that a gas network would look to safeguard its future, Dr Angela Needle, strategy director at Cadent, says such a viewpoint overlooks the critical role that gas has always played in ensuring the resilience of the UK’s energy supply – a situation she believes is unlikely to change.

Despite the recent focus on electrification and boosting renewable generation, two-thirds of energy in the UK is still met by natural gas, with the recent spike in energy prices seen since the start of the war in Ukraine highlighting how reliant the UK still is on the energy source.

It has also thrown into sharp focus the vulnerability of the UK now that it has very limited gas storage facilities.

Needle says the government is right to be pushing electrification in the form of heat pumps, as they will be used by a significant proportion of UK homes in the future, and even its 600,000 pump installations per year target is ambitious.

“Chucking the kitchen sink at it is the right thing to do at the moment, it’s not going to damage hydrogen in the long-run,” she says.

While the conversation has moved beyond electricity versus gas, understanding how hydrogen and electricity can work together to ensure security of supply is key for those who will be making decisions at both a national and regional level in the future.

“How do you make sure you can provide a resilient, reliable and cost-effective supply?” Needle asks.

While there is a tendency to jump to one answer or another, the inability to store electricity long-term in batteries means stored hydrogen is likely to play a role in generating electricity to meet winter peaks.

Similarly excess renewable energy in the summer can be used to make hydrogen for storage.

Local planning

The regulator Ofgem recently published a review into local energy system operation, looking at options such as separating out distribution system operator roles internally from the distribution network operators, or potentially even creating regional bodies with responsibilities across gas, electricity and heat.

While Needle believes we are quite far away still from giving responsibility to local authorities to plan networks, a local level plan will be necessary as well as a national plan.

“We can’t do one without the other, if Manchester’s plan is completely different from Sheffield’s plan and there is a big gas pipe running between, how do we manage that?”

While the consultation is more focused on electrification, Needle says this can’t really be separated out from gas and there needs to be a limit on how much can be decided at a local level.

“Devolving some responsibility to local authorities is a good idea, local schemes will work to a point but we do need national resilience.”

One of the obstacles already facing the hydrogen industry while it awaits a decision on its future is the lack of skills and expertise in the green gas industry currently in comparison to renewable energy.

“If we were going to set up an independent energy forum now it is more likely to be full of electricity people rather than gas, we’ve got to work out how we are going to grow the understanding of this transition.”

This lack of skills of the hydrogen side is also an issue within local authorities, which could potentially lead them to make decisions today that could close off the opportunity for low-cost heating in their areas in the future, says Needle.

“How do you set up local authorities with enough individual expertise around a range of technologies so they are not biased and so they have the ability to create and shape their plans?”

While councils are keen to take an active roll in energy planning, with many setting ambitious net zero targets, Needle says they will need funding and a blueprint from government of what that responsibility will look like if local government is to understand the energy system to the level necessary.

The exodus of all council-backed energy suppliers, such as Robin Hood Energy, from the retail market as conditions became more difficult highlights the need for local authorities to be given more guidance on energy if they take on a greater role.

“What we want local authorities to do is bear in mind that hydrogen might be a thing in the future and to just be careful about what they are doing now so they don’t end up with consumers who have missed out on the opportunity for low-cost heating,” says Needle.

Pathways project

As well as focusing on building the necessary safety case and running blending trials, as the largest gas network in the UK, Cadent has also decided to work with local authorities to help them understand the necessary pathways they will need to take to meet their net zero targets.

So far Cadent has worked with the Greater Manchester Combined Authority (GMCA) and Liverpool City Council due to their proximity to the Hynet project, which will see hydrogen produced to supply the net zero Northwest cluster.

“The North West is going to have hydrogen first, so we wanted to make sure Manchester had the opportunity to use that fuel if it wanted to,” says Needle.

Working with an independent consultancy and Electricity North West, the Decarbonisation Pathway for Greater Manchester project looked at all of the energy use in the local area, taking into account the different local buildings, industry, transport, the potential to make power locally, and heat.

Different building types were analysed to judge their potential to be electrified or be run on a hybrid system or be powered by hydrogen.

While some assumptions have to be made says Needle, the aim was to be able to look at the whole picture objectively and judge whether there will be enough hydrogen to step in when its cold, and enough electricity.

“What are the things that we are certain of now? Hydrogen isn’t certain, but while it is still uncertain, we don’t want it cut off as a future option.

“What can you do now quickly that starts you on the right journey?” Needle asks.

The project came up with a pathway split into five-year chunks containing priority actions for each of GMCA, Cadent and the government.

This includes actions such as developing energy-from-waste and biomass plants to help secure a low-carbon energy supply locally.

As well as assisting local authorities to understand the options for the future, the exercise is also helping gauge just how much hydrogen the country is likely to need, as current estimates range between 200-400TwH – a huge span, says Needle.

Such projects are also helping Cadent judge which parts of its network it is likely to need in the future and allow it to start considering what to do with parts that will be surplus to requirements.

The decision to decommission or reuse parts of the network will have a massive impact on the value of the network, says Needle, but ultimately the configuration of the network in the future has got to serve customers and if it isn’t needed it won’t exist.

One of the big issues complicating the process is the fact that consumers can choose their own heating source, which could leave just one or two houses on a street requiring hydrogen due to being unable or unwilling to electrify.

Such a situation is unlikely to result in affordable bills for consumers due to distribution charges.

“We can’t put all our eggs in one basket as we just don’t know about consumer take-up, but at least we are working on having a plan if and when we need one.”