Written Evidence Submitted by Dr Jen Baxter, Director of Innovation and Policy & Head of Protium Wales (EVP0145)
Accelerating the shift to zero emission
Accelerated innovation in both battery electric and hydrogen fuel cell electric vehicles will be a consequence of this ban. The technology from passenger vehicles in hydrogen will specifically scale up to larger vehicles.
This legislation is a cornerstone of the green transition. Major automotive manufacturers, such as Ford (1), have already committed to only producing alternative fuel and all electric vehicles by 2030. Now there is an opportunity to unlock private sector funding to enable the transition to take place. It is an opportunity to utilise the UK’s world-leading hydrogen R&D,
industrial expertise, skills, and knowledge, to be at the forefront of the global green revolution, and to secure the UK’s energy needs by reducing reliance on imported energy.
The transition is feasible within the timeframe, and the technology is available to achieve this. Hydrogen technologies, such as the Toyota Mirai, hydrogen powered forklift trucks and buses have been in use and have been used extensively in real-world situations globally for many years. From today, this technology is and can continue to be commercialised on a mass scale, accelerating the adoption of zero-emissions vehicles.
An area that will require both push and pull techniques to introduce enough low carbon hydrogen into the marketplace is production. On site production for refuelling and other small-scale projects as well as mass large scale production facilities and the associated supply chain and skills base. The growth of this production infrastructure will be evolutionary, starting small and growing out from hubs while in parallel larger projects will come online from offshore wind to hydrogen production and steam methane refining. Government support is necessary to achieve this, and policy change is required to unlock private sector funding. Further details are found in Section 2 of this report.
An exciting opportunity for low emission and zero emission vehicles is the refuelling infrastructure that hydrogen combined with electrification can offer. Both these energy vectors can be provided at refuelling centres and hydrogen through stationary fuel cells can also supply electricity in remote areas and as back up to renewables. This means that consumers and different vehicle types will have choice at all refuelling stations irrespective of their location.
Supply and demand form an essential part of the green transition. Creating a supply network of hydrogen across the UK will increase demand for hydrogen vehicles. The emergence of the market will drive private sector investment, which will in turn lead to competition, driving down prices and increasing demand for hydrogen vehicles. Public sector procurement can play a key part in driving this market. Ensuring that all vehicles are battery electric or hydrogen powered.
It must be emphasised that the transition will not be immediate, and currently, the sector is heavily reliant on further Government support to establish the supply network. Protium Green Solutions suggest increasing the target of hydrogen production from 5GW to 10GW by 2030, to supply a significantly increased number of hydrogen vehicles through an expanded network of hydrogen refuelling stations. By 2025, the UK should have at least 100 hydrogen/electric refuelling stations and 450 by 2030, with hydrogen vehicles produced and deployed on a mass scale.
To enable the scaling up of production to meet these targets, it is recommended that the Government establishes a dedicated Hydrogen Investment Fund which should be available for all businesses and projects. The Government should promote the existing world-leading hydrogen manufacturing businesses already operating in the UK. This would support investment and job creation and give business the confidence to invest in scaling up production lines and essential infrastructure. Furthermore, the DfT should introduce a subsidy to support take-up of hydrogen vehicles of all types, equivalent to that used for battery-electric vehicles, this will create a level playing field and consumer choice for vehicle type.
Beyond direct financial support, a coherent strategy from the UK Government is required and therefore a UK-wide, cross-government, political working group including ministers from the devolved administrations should be established. This group should stimulate investment, design models for future large-scale production and make legislative changes to allow for rapid implementation of clean hydrogen nationally.
The Government should also create a regulatory framework to support production of green hydrogen for the entire transport industry. Further policy changes are required to unlock private sector funding for investment. This would financially incentivise businesses and consumers to use electric vehicles.
The recent collaborative policy paper was produced by Protium Green Solutions, the Institution of Mechanical Engineer and other industry partners identifying policy anomalies, this paper recommends the following relevant policy amendments in order to incentivise electric vehicle uptake:
By pegging the level of VAT on low or zero carbon hydrogen and biodiesel to the same rate as red diesel, hydrogen can compete on a level cost basis.
This creates a level playing field for hydrogen against other alternatives, notably fossil fuels.
The RTFO is designed to incentivise fuel switching and emission reduction. The hardest emissions to abate however are in rail, shipping, aviation, and non-road vehicles.
This also creates opportunities for the UK to become a global leader in these fields, as opposed to competing solely in the more saturated road vehicle market.
The rate will remain at £3,000 as per other ULEVs, but it will be available for fuel cell vehicles above £50,000.
The introduction of zero-emission buses will be vital to establishing the required infrastructure for a fully decarbonised network. Government rail projects would enable the deployment of zero-emission trains, which are an immediate alternative to electrification. A nationwide implementation of zero-emission buses and trains will create the first opportunities for the private sector to invest significantly and allow the hydrogen supply chain to mature across the UK. This will contribute to the wider uptake of zero-emission vehicles in the future.
In addition, Government policy should continue to support the development of hydrogen aircraft, which would lead to development of a hydrogen airport. Support from DfT at this stage could see this come to fruition by 2030.
Fleets of hydrogen buses have already been introduced around the world and in the UK. However, the main challenges to large scale use are the initial investment cost, achieving a financial ROI and the low maturity of the supply chain. Trials in Aberdeen have proven the feasibility and scalability of the project, but cost is currently a limiting factor (2).
Despite this, high utilisation vehicles are the ideal primary market for decarbonisation. This is best stimulated via RTFO reform, by removing barriers that prevent use of existing on- and off-grid green energy for hydrogen production.
Hydrogen buses can be delivered quickest as they can be built faster and their use does not require any regulatory change. It is recommended by the that the UK Government uphold its commitment to purchase 4,000 new, British-made zero-emission buses, half of which should be hydrogen and bring forward All-Hydrogen-Bus Town proposals. By 2028, there should be at least four additional Hydrogen Transport Hubs. Half of UK buses will be zero-emissions including hydrogen.
A local focus will enable a low-risk entry strategy for infrastructure by concentrating demand. Buses can be introduced with at-depot refuelling, meaning no major infrastructure network requirements. This low-risk entry points can be combined with the development of hydrogen production hubs allowing the sector to grow organically.
The deployment of non-diesel HGVs in the short-to-medium-term will require both infrastructure development and a change in the use of HGVs. Operating HGVs locally rather than nationally will require at-depot refuelling, like buses and trains, less so if hydrogen is the fuel of choice. As stated above, developments and innovations in refuelling stations will enable pan vector refuelling and charging for small and larger vehicles. These opportunities will support roll out of hydrogen and electric vans and HGVs across the UK.
The innovations in hydrogen fuelled large vehicles will be utilised by buses and HGVs and are a key outcome of the phasing out of petrol and diesel vehicles across the transport sector.
1. FORD EUROPE GOES ALL-IN ON EVS ON ROAD TO SUSTAINABLE PROFITABILITY; COLOGNE SITE BEGINS $1 BILLION TRANSFORMATION. Ford Media Center. [Online] 17 02 2021. https://media.ford.com/content/fordmedia/feu/en/news/2021/02/17/ford-europe-goes-all-in-on-evs-on-road-to-sustainable-profitabil.html
2. . https://www.lowcvp.org.uk/resource-library/presentations.htm?s-search=Aberdeen&s-ctech=0&s-cveh=15&s-cvehop=0&s-cclim=0&s-csource=0&s-year=2018&s-lowcvp=. www.lowcvp.org.uk. [Online] 2018.
March 2021