Details of £20m hydrogen supply competition published
The government has published details of a £20 million competition aimed at accelerating the development of low carbon hydrogen supply solutions. It will identify and test approaches to supplying bulk hydrogen, either to the gas grid, industry, power, transport or import terminals.
The Hydrogen Supply Programme will identify and test approaches to providing bulk hydrogen, either to the gas grid, industry, power, transport or import terminals.
The proposed bulk hydrogen solutions include: low carbon production – through fossil fuel reformation with carbon capture and storage (CCS) – zero carbon production – using zero carbon energy such as electrolysis, nuclear or biomass with CCS – the import infrastructure for hydrogen and the storage of hydrogen.
A two-stage Small Business Research Initiative (SBRI) pre-commercial procurement process will be used to deliver the competition.
Phase One will include feasibility studies, with a total budget of up to £5 million and Phase Two will be a pilot demonstration with a total budget of up to £15 million.
BEIS states: “Low carbon hydrogen could play an important role in decarbonising the industry, power, heat and transport sectors. However, for a market to grow, potential users (in any application) need to be confident in supply of sufficient amounts of low carbon hydrogen at a competitive price.
“By supporting innovative pilots to help develop the process and technologies required to supply bulk low carbon hydrogen, this programme seeks to address the cost differential between natural gas and low carbon hydrogen.”
Phase 1: Feasibility studies, total budget of up to £5m, up to £500k contract for each study. Project teams will carry out feasibility studies that will identify:
An assessment of the market size and export opportunities for the technology for bulk low carbon hydrogen supply.
A detailed engineering design for each hydrogen supply solution, against which an assessment could be made on a number of metrics. These are likely to include: capital and operating costs, process risks (reliability), the available and the impact of variable demand, the hydrogen quality, the potential to mitigate greenhouse gases, the build rate and how the process could be scaled. Process modelling or small-scale trials may also be required to verify the design, the use of modelling or demonstration to support the hydrogen supply solution will be assessed under project financing.
A detailed development plan for each solution describing the key development steps to commercialisation, including the key barriers and risks. This should include a detailed focus on the components to be piloted in Phase 2. Each step will be costed.
A detailed assessment of the business plan on how the process will continue to be developed after the funding for the pilot ends.
Phase 2: Pilot demonstration (total budget of up to £15m, up to £7.5m contract for each demonstration project.
This phase is for projects that have been selected from Phase 1, based on the information contained in their feasibility study.
This phase will result in the implementation and demonstration of a hydrogen supply solution and will consider applications to pilot key components or further develop the design of the new hydrogen supply solutions. A pilot demonstration is not limited to a physical demonstration and may only be for parts of the process. This could include detailed process modelling or engineering design.