Hydrogen Industry Leaders Scotland conference – the key takeaways

Lauren Winters, Mark Summers and Janice Napier attended the recent Hydrogen Industry Leaders Scotland conference in Glasgow and have prepared this short note of the key takeaways. The conference brought together key players in the industry to discuss the progress made in the hydrogen industry to date as well as the challenges that lie ahead. 

The event featured insights from notable speakers including Stuart McKay, Head of Hydrogen Policy at the Scottish Government, Dr Oliver Taylor CEO - BP Aberdeen Hydrogen Energy Ltd, Nicole Tang, Project Development Manager at RWE, Jan Caldeira Riechers of GASCADE Gastransport and Barry Stalker, Head of the National Planning Hub. 

The key takeaways from the event are:

Government support

• The Scottish Government remains committed to supporting the development of the hydrogen industry by developing green hydrogen production, improving the hydrogen supply chain, and enhancing hydrogen transport and storage infrastructure.
• The Scottish Government, via the Energy Transition Fund, has contributed £15M over the past few years to assist Aberdeen in its drive to deploy its fleet of hydrogen buses.
• Publication of the UK Government Hydrogen strategy is awaited later in the year and developers highlighted that they are keen that the timeline for publication of that does not slip. 

Potential for export to Europe

• Germany consumes around 25% of all energy usage in Europe and needs to look outside of Germany to manage and meet their energy demand.
• Germany is set to have the largest hydrogen grid in Europe, with plans for a significant expansion of its hydrogen pipeline infrastructure, including repurposing its existing pipelines and the creation of new pipelines for transport and distribution. 
• The German government is considering hydrogen imports from the UK to meet their needs and demand. The Scottish Government recognises that there is an opportunity for Scotland and the UK to export hydrogen to the German market.

Developer concerns

• The end users of the hydrogen produced are key for project viability and developers must size their projects according to their end users.
• At present, there is mixed experience at planning authorities to deal with and consider planning applications for hydrogen projects. To combat this, the National Planning Hub has very recently published the Hydrogen Planning Process Map to help Scottish planning authorities and developers to understand the consenting process for hydrogen developments. The Map sets out the process for dealing with hydrogen planning applications, the timeframes and likely information required.
• There remains a misunderstanding of the general public about hydrogen projects particularly from a health and safety perspective and the hydrogen industry needs to be more vocal about the success stories, such as the pioneering Aberdeen Hydrogen Hub which has reached financial investment decision and is in construction as a production and distribution facility, with phase 1 of the project on track to start delivering hydrogen in 2026.
• The industry faces challenges around obtaining water supply permits. The application process for obtaining permits is primarily designed for housing developments rather than large scale hydrogen projects and applications are determined too late in the project timeline. This causes difficulties for developers when seeking final investment decisions. 

Funding of projects

• It is of critical importance for developers of hydrogen projects that the HAR funding process is progressed quicker, and more certainty is given to developers on the requirements to obtain such funding.
• The industry needs to unlock private investment to boost the number of projects achieving final investment decisions and renew impetus in the sector.

The hydrogen industry continues to represent an opportunity for the renewables industry, but progress remains slower than many in the industry would have hoped. Key to unlocking the industry will be seeing more projects coming online and achieving positive financial investment decisions. If you would like any further information, or advice related to any of the information in this article, please contact Lauren Winters, Mark Summers or Janice Napier.