11 green hydrogen projects, totalling 125MW of capacity, have been selected for £2bn ($2.5bn) of UK Government support.
The selected projects under the first hydrogen allocation round (HAR1) will receive a share of £2bn in revenue support from the Hydrogen Production Business Model.
While the revenue support will start to be paid once projects become operational – with the first expected in 2025 – over £90m ($113.7m) has been allocated to support their construction from the Net Zero Hydrogen Fund.
It is hoped the funding will give developers, investors and supply chain players certainty to commit to backing UK hydrogen projects.
The projects have agreed at a weighted average strike price of £241/MWh ($304.64/MWh). Government has said the price has been weighted by “the total hydrogen volumes expected to be produced by each project over the lifetime of the LCHA (low-carbon hydrogen agreement) contract.”
The selected projects are:
- Carlton Power’s 21MW Barrow Green Hydrogen Project, Cumbria
- Hygen’s 24.5MW Bradford Low-Carbon Hydrogen, Yorkshire
- Scottish Power and Storegga’s 10.6MW Cromarty Hydrogen, Scotland
- HYRO’s 10.6MW Green Hydrogen 3, Southeast
- Marubeni Europower’s 5.2MW Hybont, Wales
- JG Pears and GeoPura’s 9.3MW HyMarnham, East Midlands
- Carlton Power’s 7MW Langage Green Hydrogen, Southwest
- EDF Renewables Hydrogen’s 5.2MW Tees Green Hydrogen, Northeast
- Carlton Power’s 10.5MW Trafford Green Hydrogen, Northwest
- H2 Energy and Trafigura’s 14.2MW West Wales Hydrogen, Wales
- Scottish Power’s 7.1MW Whitelee Green Hydrogen, Scotland
HAR1 was publicised to fund up 250MW of electrolytic hydrogen projects. The government has said, of the 17 projects that entered final negotiations, two withdrew, with four others not being successful.
“We remain committed to our ambition of having up to 1GW of electrolytic hydrogen in construction or operation by the end of 2025,” the government said.
It has also launched the second hydrogen allocation round (HAR2), which aims to fund up to 875MW of projects.
The selection comes months after UK Parliament passed the Energy Act, with a hydrogen industry funding mechanism attached.
Read more: UK Energy Act passed – with hydrogen levy attached
After months of speculation about its inclusion within the Act, the final text gave government the power to place a levy on ‘gas shippers’ to fund government-backed hydrogen developments.
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