hydrogen strategy

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Strategy positions UK as a world leader in the hydrogen space, supporting 9,000 plus jobs and unlocking £4 billion in investment by 2030.

By Paul Davies, John-Patrick Sweny, and James Bee

On 17 August 2021, the Department for Business, Energy and Industrial Strategy (BEIS) published the UK’s first Hydrogen Strategy (the Strategy). The Strategy sets out the government’s roadmap for achieving its ambition of 5GW of low carbon hydrogen production capacity by 2030, as identified in the Ten Point Industrial Revolution Plan released in November 2020, with government projections indicating that 20-35% of the UK’s energy consumption could be hydrogen-based by 2050.

Forecasts suggest that by 2030, hydrogen could play an important role in decarbonising certain highly polluting industries that are unsuitable for electrification, such as chemicals, industrial furnaces, and long-distance or heavy-duty transport, as well as replace natural gas in powering around three million homes a year. The Strategy clarifies the government’s view that developing the UK hydrogen sector will achieve the twin goals of reducing the UK’s carbon footprint in line with the UK’s net zero commitments, whilst stimulating significant job creation and economic growth in the industrial sector.

The report lays down policies aimed at fostering carbon neutrality in the UK by 2050 and supporting Paris Agreement pledges.

By Paul A. Davies and Michael D. Green

On 9 December 2020, the UK Climate Change Committee (the Committee) published its 6th Carbon Budget (the Budget), as required under the Climate Change Act. The Budget provides ministers with advice on the volume of greenhouse gases the UK can emit during the period 2033-2037 and also contains policies designed to place the UK on track to achieving carbon neutrality by 2050.

The Budget comes in the context of the UK bolstering its climate ambitions ahead of hosting the COP26 in Glasgow next year, as the Prime Minister has recently committed to cutting emissions by at least 68% from 1990 levels by 2030. The Government also published a ten-point plan aimed at boosting the green economy.

The Programme includes a new CO2 pricing regime aimed at emissions caused by the building sector and by traffic and transport.

By Jörn Kassow

On 20 September 2019, the German government adopted the Climate Action Programme 2030, a plan to ensure that Germany achieves its climate protection goals for 2030, including a reduction of greenhouse gas emissions by 55% (compared to 1990). The Programme comprises a number of measures for all relevant sectors. Significant measures include:

CO2 pricing: New pricing of CO2 emissions caused by the building sector and by traffic and transport may be the single most important aspect of the Programme. The relevant national emissions trading system will be launched in 2021. Companies selling heating fuel (such as heating oil, gas, or coal) and fuel for vehicles will need to buy one certificate for every tonne of CO2 emitted by the products they sell. While fuel traders will initially bear the costs of these certificates, such costs are likely to be passed on to consumers. The trading system will start with a fixed price of €10 per tonne of CO2 in 2021 and increase to €35 per tonne of CO2 in 2025. After 2025, the market will set the price, within a fixed band. The total quantity of certificates issued throughout Germany shall be in line with the German and European climate targets.