MPs call on the Chancellor to give hydrogen and carbon capture project the green light at next week’s Budget
10 March 2023
The UK will fail to meet its net zero targets, and transition away from polluting fossil fuels, unless carbon capture is rolled out at scale, the Scottish Affairs Committee warns today.
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Scotland could hold the key to hydrogen and carbon capture being rolled out at scale across the UK. It has extensive renewable energy potential which could be the natural home for green hydrogen, with skills from the oil and gas sector ready to be transitioned to hydrogen and carbon capture as the UK looks beyond fossil fuels.
Existing infrastructure in Scotland allows for opportunities to reform gas into hydrogen at St Fergus, and the nation has access to secure geological storage of carbon due to North Sea oil and gas fields.
Further, the Committee was told that there are 180GW of recoverable installed wind capacity in Scottish waters, which vastly exceeds Scotland’s and much of the UK’s needs, presenting a unique opportunity for the UK to take a leading position in the global hydrogen export market.
Yet despite this, and ambitious targets being set by both the UK and Scottish governments, policy progress appears lacking. While the Committee acknowledges that relations between the UK and Scottish governments in this area appear to be good, there does not appear to be a sense of urgency in the numerous areas requiring attention before hydrogen can be rolled out.
This includes key decisions on hydrogen production, planning decisions, storage and transportation. Interim targets to assess progress and a timeline of when key milestones will be met will be critical for industry confidence.
Delays to decision making around the Track 2 carbon, capture, usage and storage (CCUS) cluster sequencing are disappointing and puts projects like the Acorn carbon capture and storage (CCS) and hydrogen project at risk. As part of Scottish Cluster, Acorn is critical to meeting the decarbonisation objectives of not just Scotland but the UK as a whole.
Acorn, based at the existing gas terminal at St Fergus in Aberdeenshire, is ideally placed to take natural gas and reform it into clean burning hydrogen with the CO2 emissions captured, removed and stored. The Hydrogen produced can then be used as a clean burning fuel to replace fuel oil at industrial complexes such as Grangemouth. Next week’s Budget provides the ideal opportunity for the UK Government to outline the funding details for Acorn and the rest of the Scottish Cluster to progress at pace.
Scottish Affairs Committee Chair, Pete Wishart MP, said:
“Net zero is little more than a pipe dream without carbon capture. The hydrogen potential is clearly there, and our Committee is impressed with projects where energy companies are piloting green energy projects around Scotland making use of our vast renewable energy potential.
“But the twin-track approach that the UK Government is committed to introducing, leaves gaping policy holes: none more so than around carbon capture. It is deeply disappointing that the Acorn Project, that already has much of the necessary infrastructure in place, has been put on the back-burner and the lack of any certainty is majorly denting industry confidence. Clarity must be given at next week’s Budget.
“If the policy gaps are addressed, and the UK Government jumps on the opportunities in Scotland, we could be a major exporter of clean energy with thriving clusters and local economies.”
The UK Government is due to make a decision on hydrogen in home heating by 2026. In anticipation of this, the Committee recommends that the UK Government mandates hydrogen-ready boilers in all suitable properties as soon as practicable.
- Inquiry: Hydrogen and carbon capture in Scotland
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