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Energy Security – the challenge and opportunity for hydrogen

Updated: Apr 18, 2023


In preparation for RenewableUK's Green Hydrogen conference in Birmingham, Micheal Wagner, Special Advisor at Event Sponsors and hydrogen specialist AFRY explains in our guest blog how hydrogen can help the UK's energy security.


The UK energy system has provided energy consumers with high levels of security of supply and it will be important to ensure that these levels are maintained as the energy system is decarbonised. Historically the flexibility of gas supplies and gas storage has been key to meeting variability of demand in both the gas and power sectors. However, as the use of gas decreases and the level of intermittent renewables on the system increases, the challenges of matching supply and demand will increase.


Hydrogen projects will need to resolve how to supply consumer demand profiles


Providing energy security will be a particular focus for the developing hydrogen economy. Initial hydrogen projects will be small stand-alone systems on single sites or small clusters. Providing security of supply is likely to require additional investment to provide redundancy in key parts of the production process as well as investment in tank storage facilities, to provide flexibility to manage fluctuating demand and in the event of short-term production or demand outages.


Supplying hydrogen to meet consumer demand profiles will be particularly challenging for standalone green hydrogen systems. These will need to use intermittent renewable production as the primary energy for electrolysers, although the Low Carbon Hydrogen Standard provides flexibility to use some grid electricity. Meeting hydrogen demand profiles will require optimisation across all elements of the project, likely requiring oversizing of key components such as renewable and electrolyser capacity as well as significant tank storage. The costs of providing security of supply will be significant, increasing hydrogen costs by 50-100% depending on project architecture.


Hydrogen developers will need to work with consumers to develop contracts which allocate the risks associated with supplying hydrogen demand fairly across counterparties. Many consumers will have some demand side flexibility, understanding the potential and costs of delivering this will be key to developing cost effective hydrogen projects providing high levels of security of supply. Where users can switch back to natural gas relatively dynamically, or accept variable blends of hydrogen and methane, this will significantly reduce the costs associated with hydrogen supply, especially for early projects.


As the hydrogen economy grows, we will see the development of pipes connecting multiple production facilities and consumers. Initially these are likely to be within the industrial clusters, but as time progresses projects such as National Gas’s Project Union will start to provide interconnection between clusters and wider production and demand across the country. The ability to interconnect multiple production and demand sites will create a portfolio effect which will reduce the costs of delivering security of supply across the system and allow early hydrogen markets to develop. A key factor which will help reduce hydrogen system costs will be the development of geological storage within salt caverns, porous rock formations or depleted gas fields. These provide significantly cheaper solutions for storing large volumes of hydrogen over long time periods than above ground tank storage. Several developers are already exploring geological storage including Inovyn who are exploring repurposing salt caverns in Cheshire, SSE and Equinor who are looking at developing a new salt cavern at their Aldbrough site, and Centrica who are exploring converting the Rough facility to store hydrogen.


Geological hydrogen storage provides an opportunity to manage long term imbalances on the electricity system


Geological storage of hydrogen is likely to provide one of the most optimal technologies for managing longer term energy imbalances across the energy system more widely. As the hydrogen system develops geological hydrogen storage will be needed to provide balancing and security of supply for the hydrogen system but will also increasingly be used to balance the electricity system.


Geological hydrogen stores have the capacity to manage the long-term imbalances on the electricity system arising from the intermittency and seasonality of wind generation. Electrolysers can utilise excess wind energy during periods of high wind output, with hydrogen injected into geological storage facilities. This hydrogen can then be withdrawn during periods of low wind output and used to fuel hydrogen gas turbines or other hydrogen fuelled peaking generation. Work that AFRY has undertaken shows the power sector could require between 7-15TWh of hydrogen storage in 2050. To give an idea of scale 15TWh, is approximately equivalent to repurposing all of the UK’s current gas storage facilities (including the Rough facility) to hydrogen. These facilities will be managing intermittency in wind generation rather than simply seasonal demand profiles, so will need high injection and withdrawal rates, and are likely to operate doing the equivalent of around 5 full cycles per year.



Energy security will develop from being a challenge to an opportunity for hydrogen


Providing energy security for initial hydrogen projects is likely to be expensive, and developers will need to work with hydrogen users to allocate risks and explore the potential for demand side flexibility and use of alternative fuels as back up supplies. However, as the hydrogen system develops to include a backbone of hydrogen pipes interconnecting hydrogen clusters, and connecting new and converted geological hydrogen storage facilities, the hydrogen system will become increasingly resilient. Geological hydrogen storage can also provide cost effective, long term, storage for the electricity system, providing the flexibility to manage the intermittent and seasonal nature of wind generation. Thus, while providing energy security will be challenging for early hydrogen projects, as the hydrogen system develops, providing security for the energy system as a whole will be one of hydrogen’s key functions.


For more information about AFRY’s work on hydrogen please contact michael.wagner@afry.com or register for Green Hydrogen #RUKGH23 in Birmingham!


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