Representing the UK Hydrogen and Fuel Cell Industry
Event hosted by UK Hydrogen and Fuel Cell Association, PRASEG and APPGIE
“Designing a Low Carbon Economy: how hydrogen and fuel cells can help to optimise the UK energy landscape" Evening Debate and Reception 30th January 2013, Portcullis House, Westminster Panellists: Dennis Hayter, Chairman of the UK Hydrogen and Fuel Cell Association and Vice President, Business Development, Intelligent Energy Alastair Rennie, Deputy Chair of the UK Hydrogen and Fuel Cell Association and Project Director, Amec Ian Williamson, CEO, AFC Energy Graham Cooley, CEO, ITM Power Panel Discussion Facilitator: Noel Botha, Orion Innovations
The role of H2 and fuel cells in delivering a low carbon economy and optimising the UK energy landscape We know that the low carbon economy of the future will include more nuclear and renewable energy generation, such as offshore wind, and less fossil fuel. Where do H2 and fuel cells fit? The EU target for renewables is 20% by 2020. Hydrogen fuel cells add value to the investment case for renewables since hydrogen can be used to optimise the network by providing energy storage in addition to generating power and heat for individual homes and buildings or providing a transport fuel across the transport sectors. Hydrogen is an energy vector; the ability to link traditionally distinct energy sectors enable hydrogen to further contribute to energy security along with efficient low carbon energy solutions. The difference between the power grid and gas grid is storage. ‘Power to gas’ is a way to use excess electricity to produce hydrogen and feed it into the gas grid the largest storage device in existence. What are the benefits of using H2 in fuel cells rather than, for example, combined cycle gas fired turbines? The chemical reaction in a fuel cell is the same as in a continuously operating battery with a constant supply of feedstock. Fuel cells operate at 50‐60% efficiency, considerably higher than other technologies, and are scalable, with no loss of efficiency at scale. If you are interested in finding out more about fuel cells and hydrogen, visit www.ukhfca.co.uk or contact the UK Hydrogen and Fuel Cell Association at info@ukhfca.co.uk. Follow us on
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Representing the UK Hydrogen and Fuel Cell Industry
What about heat? Those chemical reactions give fuel cells flexibility with respect to heat and power output. They also produce water which can be an added bonus in some locations. Therefore, if used wisely, fuel cells can provide three sources of revenue.
The competitiveness of H2 and fuel cells relative to alternative options There are many other new options ‐ distributed power generation, batteries, international inter‐ connectors, and shale gas‐fired power stations ‐ won’t these offer a lower cost solution? Whist either shale gas (with clean up) or hydrogen can be used in a fuel cell, hydrogen offers considerable carbon reduction benefits. CCS is seen as playing a significant role in reducing or eliminating the effects of using fossil fuels in power generation. Does this not provide a solution that avoids the need to invest substantial sums in relatively novel technology? And continue the use of coal? It is also a way to produce affordable hydrogen. With CCS, carbon is removed before being stored in the gas grid or used to generate power. Fuel cells are talked about as a replacement to the internal combustion engine in cars, buses and so forth. Are efficient ICEs, hybrid and electric vehicles not a more sensible solution? The UK commitment under the Renewable Energy Directive requires that 10% of energy used in transport to be from renewable energy sources by 2020. According to the McKinsey report1 “A portfolio of power‐trains for Europe: a fact‐based analysis”, battery electric vehicles are better for urban short range trips with smaller classes of vehicles (A/B segments) while fuel cell vehicles are the better solution for larger and longer range family car trips. There is an on‐going transition to ultra‐low carbon vehicles. This is highlighted by the fact that there are now over 1,000 types of vehicles which comply with congestion charge exemption levels. A hydrogen fuel cell car works similarly to a normal vehicle and takes only 3 minutes to refuel. The challenges to be solved are the lack of hydrogen refuelling stations and hydrogen storage and distribution. The UK H2Mobility project is looking specifically to address the challenge of how hydrogen infrastructure can be rolled out across the UK. The results of the first phase of the project will be announced on 4th February, and will confirm that there is a pathway for a fleet of 1.6 million Fuel cell electric hydrogen vehicles in the UK by 2030, and sustained by a network of 1105 hydrogen refuelling stations installed by 2030.2
If you are interested in finding out more about fuel cells and hydrogen, visit www.ukhfca.co.uk or contact the UK Hydrogen and Fuel Cell Association at info@ukhfca.co.uk. Follow us on
@UKHFCA
Representing the UK Hydrogen and Fuel Cell Industry
The nature and scale of the H2 and fuel cell opportunity for UK plc How large an opportunity are H2 and fuel cells for UK plc? Aren’t the major fuel cell companies based in North America? How will UK plc benefit? How can expensive imports be avoided? The UK has been a modest supporter of the industry so far, while other countries have progressed more quickly and emphatically. However, the UK is learning lessons from Japan and Germany as first movers in technology deployment along with the US and Canada. According to a recent survey from the UK HFCA, member companies are expecting cumulative annual revenues to reach £1bn by 2020, bringing over 2,200 fuel cell and hydrogen related jobs to the UK. There is need for investment to replace ageing assets. This investment can support fuel cells along with other technologies. The UK currently has over 100 companies involved in the hydrogen and fuel cell supply chain. With the right support mechanisms in place, there is a real opportunity for hydrogen and fuel cells to be a tremendous UK success story, generating green jobs and addressing a range of environmental and energy security objectives. What does UK plc need to do in order to best exploit this opportunity? The UK needs investment and certainty. There is an imperative need for recognition of the direct benefits achievable by the sector and long‐term supportive policies to lower the financial risks and encourage early stage private sector investment. There is a plethora of broad mechanisms, but a lack of policy support focused specifically on realising the benefits of hydrogen and fuel cells. The UK HFCA recommends a Feed‐in Tariff scheme across all sectors (heat, power and transport) for ten years to offset early stage investments and help build the industry. The cross‐sector coverage of the proposed mechanism represents an innovative approach that has not been followed by any other country. What should businesses do? Ideally, fuel cells should be built in the UK. However, it may be more practical to build locally in end user markets and channel profits back in the country. For this to happen, early local customers will be needed. The message has to be spread and we are keen to see greater awareness across business of what fuel cells and hydrogen offer. What is different now? Due to the maturity of the industry it is now possible to consider market segmentation. If you are interested in finding out more about fuel cells and hydrogen, visit www.ukhfca.co.uk or contact the UK Hydrogen and Fuel Cell Association at info@ukhfca.co.uk. Follow us on
@UKHFCA
Representing the UK Hydrogen and Fuel Cell Industry
There is much more capital involved than we recognise. However, policy is still needed to help achieve long‐term goals.
Questions from the floor What is the timescale for the Feed‐in Tariff Proposal? The Association is looking for the Feed‐in Tariff to be implemented in April 2014 in accordance with the review of the Energy Bill. What can be learned from other countries? There have been many trials to investigate performance in various environments. Publicising the results helps all players to optimise their response to the growing opportunities. This also applies to the results of programmes that have been funded under the EU Fuel Cell and Hydrogen Joint Undertaking, covering both R&D focused work and Demonstration projects.4 How do the costs of hydrogen and fuel cells compare across various markets? Hydrogen can provide by far the lowest cost mid to long‐term storage. It can be also put into the gas grid. Within the transport sector, fuel cell electric vehicles will have a higher purchase price than conventional internal combustion engine vehicles but will reach parity in total cost of ownership at around 2020 and be more cost effective as a transport option thereafter. How can local communities get involved? There are many good examples of engagement at the local level such as the London Hydrogen Partnership. The Greater Manchester Hydrogen Partnership will be launched on 4th March. The UK Hydrogen and Fuel Cell Association would be delighted to engage with local communities seeking to develop activity in this area. Various other opportunities for local communities such as Social housing and mini grids represent excellent opportunities for the deployment of hydrogen and fuel cells. Follow‐up Networking Session: refreshments kindly sponsored by Intelligent Energy and Kiwa GASTEC
Relevant Resources 1. You can find the full report at: http://ec.europa.eu/research/fch/pdf/a_portfolio_of_power_trains_for_europe_a_fact_based__a nalysis.pdf 2. You can find further information at: http://news.bis.gov.uk/Press‐Releases/Future‐of‐hydrogen‐ powered‐cars‐mapped‐out‐68719.aspx If you are interested in finding out more about fuel cells and hydrogen, visit www.ukhfca.co.uk or contact the UK Hydrogen and Fuel Cell Association at info@ukhfca.co.uk. Follow us on
@UKHFCA
Representing the UK Hydrogen and Fuel Cell Industry
3. You can find the Green Jobs Survey Results 2012 at: http://www.ukhfca.co.uk/wp‐ content/uploads/Hydrogen‐and‐fuel‐cell‐industry.pdf 4. You can find further information at: http://www.fch‐ju.eu/
If you are interested in finding out more about fuel cells and hydrogen, visit www.ukhfca.co.uk or contact the UK Hydrogen and Fuel Cell Association at info@ukhfca.co.uk. Follow us on
@UKHFCA