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UK | Hydrogen Sector Development Action Plan

image credit: BEIS
Charley Rattan's picture
World Hydrogen Leader Charley Rattan Associates

UK based offshore wind & hydrogen corporate advisor and trainer; Faculty member World Hydrogen Leaders. Delivering global hydrogen and offshore wind corporate investment advice, business...

  • Member since 2019
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  • Jul 31, 2022

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When government published the UK’s first Hydrogen Strategy in August 2021, we acknowledged that the UK has the geography, geology, infrastructure, and expertise to rapidly build a low carbon hydrogen economy.

That ambition brings with it significant potential for investment into the UK, and opportunities for UK companies in the supply chain and our skills base, as well as wider economic benefits to all regions of the country. Since then, it has become even clearer that hydrogen must be a core part of the UK’s future energy security as well as plans to meet our legally binding commitment to achieving net zero by 2050.

In the British Energy Security Strategy, we doubled our ambition from 5GW to up to 10GW of low carbon hydrogen production capacity by 2030. That commitment significantly increases the scale of opportunity for the UK to become a genuine world leader in the development, deployment and build-out of hydrogen infrastructure across the full value chain, covering production, transmission and storage, and the range of potential end uses for hydrogen, including power, heat, and transport. Analysis by BEIS suggests that the 10GW ambition could mobilise over £9 billion of private investment in production alone, and support more than 12,000 jobs by 2030 across production, distribution and storge, including domestic and exports.

Significantly higher investment and jobs figures are expected across the wider supply chain. The purpose of this Sector Development Action Plan is to highlight the nature and scale of opportunities across the hydrogen economy in the UK. It focuses on four key areas: investment; supply chains; jobs and skills; and exports. It sets out actions in those areas being taken by government and industry to maximise the benefits from scaling up the UK hydrogen economy. On investment, we recap the progress government has made setting out support mechanisms to make hydrogen projects bankable and investable propositions in the UK.

Where government can further support this investment through structured engagement with investors and industry, we lay out proposals for how, including investor profiling to help stakeholders understand where and when investment is most needed in the emerging hydrogen economy and digital tools to showcase UK projects to potential investors. In our supply chains we have existing strengths and capabilities with the potential not only to drive the development and deployment of hydrogen at home – for example in electrolyser and fuel cell manufacture – but to promote exports to help build a global hydrogen economy.

Actions to support supply chains focus on matching companies to opportunities through improving the visibility of project pipelines and companies’ understanding of project specifications. Government will also ask industry to lead a process to voluntarily set levels of ambition for supply chains in UK hydrogen projects. The Plan underlines the importance of adopting a holistic approach to supporting jobs and skills for a hydrogen economy and how that economy can benefit from the just transition for traditional sectors such as oil and gas. It sets out how government will use the resources of 5 bodies like the Green Jobs Delivery Group to ensure hydrogen benefits from the broad range of skills common to the net zero mission, as well as establish hydrogen-specific groups like the Hydrogen Early Careers Professional Forum to develop and help progress a diverse and talented workforce. On exports, the Plan considers the growing global hydrogen economy, and the great potential for the UK hydrogen industry to export goods and services, including with support by instruments from UK Export Finance.

Maximising benefits for the UK in these areas relies, in part, on robust monitoring and evaluation to understand performance and inform policy development to improve results from the UK hydrogen economy. Utilising the Theory of Change framework, we illustrate metrics that can measure success against our sector development objectives and commit to developing these to keep step with the fast-moving nature of the hydrogen economy, giving us flexibility to update our actions and metrics and incorporate new data as they become available. This Action Plan is not exhaustive, and government will not stand still.

We will continue to work with industry, investors, and other stakeholders not only to develop, deliver and monitor these actions, but to agree new ones as our collective understanding of the UK hydrogen economy matures.


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