Investing in hydrogen: Ready, set, net zero
The role of hydrogen
The UK will need to replace all fossil fuel energy sources to meet the net-zero target by 2050. Hydrogen can help boost decarbonisation efforts across a number of sectors.
A number of pathways have been suggested for the UK to meet its net-zero target and hydrogen plays an important role in each. However, it is uncertain how much hydrogen will be required and in which sectors it will be deployed.
The cost of hydrogen
Building a hydrogen economy will require substantial and targeted investment. The chapter sets out the findings of our bespoke model that shows the levelised cost of hydrogen in each segment of the hydrogen value chain – production, conversion, storage and transport. The model also helps estimate the investment needed for production technologies and highlights the need for minimising the cost of production, conversion and transport to improve hydrogen’s commercial competitiveness.
Making hydrogen investing more attractive
Considering the size of the challenge and the urgency to make decisions, investors need to be confident that there will be demand for low carbon or carbon-free hydrogen and that investing in hydrogen energy will deliver a good return. Therefore, there is a pressing need for targeted policy interventions that are summarised in the final chapter of the report.