Climate Emergency – Hydrogen is part of the solution

Darren Walsh, energy sector partner at DWF law writes for Environment Journal about the importance of hydrogen fuel to help solve the climate emergency and what governments need to do to incentivise it.

As of 20 May 2020, according to The Climate Emergency Declaration and Mobilisation website, 1496 jurisdictions in 30 countries have declared a climate emergency.

That means around 820 million citizens are living in areas that consider themselves as being affected by climate emergency.

The UK was the first country to declare a climate emergency when the Labour Party declared this to the House of Commons on 1 May 2019, with the Gibraltar Parliament following on 3 May 2019 and the Republic of Ireland declaring the same on 9 May 2019.

With so many citizens captured by this emergency and so many countries and authorities making this declaration, it is important to take a step back to ask what is meant by ‘climate emergency’ and do all declarations seek to address the same objective?

Many Local Governments in the UK have sought to seek net carbon neutral targets by 2030, some 20 years ahead of the UK’s commitment from the Paris Agreement of 2050.

Having made a declaration, it is imperative that a climate emergency response is agreed and acted upon. Declaring a climate emergency is one thing, but declaring what our collective response should be is surely essential.

Many campaigners have demanded a war-like response to the climate emergency; saying that in times of great adversity, central and local governments ought to implement transformational and ground-breaking initiatives to protect their people and territories.

COVID-19 demonstrates what government can do in times of adversity and whilst we are reeling from economic and human travesty created by the pandemic, lessons can be learned as to what measures can be deployed to deal with life and planet-destroying events.

The unknown as we all come out of lockdown on how significant a financial impact will COVID-19 have on short, medium and long-term climate emergency action plans.

For the UK, there remains a strong appetite for decentralised and distributable energy, whether electrical, heat or both.

Hydrogen is seen as the better option for decarbonising our transport and heating infrastructure with many plans in place to implement a new hydrogen-based era.

At a recent webinar hosted by HyCymru Hydrogen Technology, we learned about the policy and strategy being developed for Wales’ approach to a hydrogen solution.

Protium has written an anomalies paper, outlining the UK Government’s inconsistencies, suggesting that it takes a technology-neutral approach to decarbonisation, whilst on the other hand, its policy and taxation framework suggests otherwise. Protium puts forward the argument that the hydrogen industry is not looking for grant funding; it is merely seeking a level playing field.

Some anomalies that they identify include variations on VAT, for example, where hydrogen is always charged at the standard rate, regardless of its carbon content.

Employees charging electric vehicles at work can be charged for the electricity at less than the standard VAT rate, but the same relief is not applicable to hydrogen. Due to the need for separate structures between the power generation asset, the electrolysis asset and the end-customer, green hydrogen pays VAT and grid taxes for the electricity and VAT on the end fuel sale.

There is clearly interest in developing green hydrogen and with many gas-fired combined heat and power systems readily convertible with retrofit technology, there is certainly an existing infrastructure to tap into.

The Environmental Audit Committee is currently conducting an overarching inquiry looking at technical innovations, which could contribute to tackling climate change. Responses are due in by 19 June 2020. The inquiry is an opportunity to highlight UK-based examples of innovation and excellence.

The Committee reported in its 2019 report on Net Zero that several technologies had not performed as well as envisaged or had not reduced in cost as expected having conducted its initial modelling in 2008.

They say that looking to the future, it is difficult to predict how individual technologies will reduce in cost or improve in efficiency, but alongside other changes, technological innovation will be crucial to the UK achieving its emissions reduction goals.

They say that as hydrogen has a potential role in electricity generation, transportation, industry and heating fully integrated policy, regulatory design and implementation is crucial.

This is clearly required, but wider policy implications for green hydrogen, as well as technical innovation, will play a key role in driving efficiencies in cost production and ensuring that green hydrogen is able to operate on a level playing field with other low carbon technologies.

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