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UK natural gas distributors eye large-scale gas grid conversion to hydrogen

Highlights

H21 North of England report sets out hydrogen plans

GBP22.7 billion project to convert homes by 2034

FID targeted for 2023, with first conversions in 2028

London — The UK can convert 3.7 million homes in the north of England from natural gas to hydrogen by 2034 in a bid to reduce carbon emissions, according to a new report published Friday.

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UK gas distributors Northern Gas Networks and Cadent -- together with Norway's Equinor -- propose the conversion of parts of the UK gas grid to hydrogen starting in 2028 in order to provide the start of the "deep decarbonization" of heating in the country.

The development of green gases -- such as biomethane, hydrogen, power-to-gas projects and other forms of gas decarbonization -- is a growing trend in the European gas industry as it looks to retain a role for gas in a decarbonized future Europe.

The industry is still in its infancy, but initiatives are pushing the industry forward, for example in Denmark where 10% of gas in the grid is in the form of green gas.

Northern Gas Networks said Friday the UK was ready to "lead the way in reducing CO2 emissions" with its proposal for the world's largest clean energy project, which is expected to cost GBP22.7 billion ($29.2 billion).

"The H21 North of England report sets out detailed plans on how hydrogen could be used as a way to deliver clean energy to millions of homes across the North of England," it said.

It outlines how over 3.7 million homes and 40,000 businesses and industries in the north of England that are heated by gas could be converted to hydrogen by 2034.

The project also proposes a six-phase UK rollout that could see a further 12 million homes across the rest of the country converted to hydrogen by 2050.

"This has the combined potential to reduce carbon emissions by over 258 million mt/year by 2050," Northern Gas Networks said.

PRODUCTION FACILITY

The hydrogen would be produced from gas at a self-powered 12 GW production facility with carbon capture technology.

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Salt caverns would be used to store hydrogen until required, ensuring there is more than enough to meet demand during the coldest times of year.

The by-product of the process, carbon dioxide, would be stored in saline aquifers such as those in the Southern North Sea off the northeast coast of England.

The hydrogen produced would be transported to the local city grids in a new high-pressure transmission system designed with extra capacity to enable future supply for industry, power and transport.

If expanded to the rest of the UK, the project would see a total of 15.7 million homes converted to hydrogen by 2050, Northern Gas Networks said.

FID IN 2023

The H21 North of England report says the next step is to progress into the front-end engineering and design phase.

The FEED phase would be a 3-4 year program starting in 2019 to detail the technical solution towards a final investment decision by 2023, Northern Gas Networks said.

The report also calls on the UK government and industry to share the cost of the phase as a sign of future commitment on both sides.

"If the government is to meet its legally-binding carbon reduction targets, it cannot afford to miss out on the opportunities presented by decarbonizing the UK gas network and its associated impact on other industries," Dan Sadler, H21 program director at Northern Gas Networks, said.

Equinor's executive vice president for new energy solutions, Pal Eitrheim, said gas and gas infrastructure can be part of the solution also in a low carbon future "where gas becomes a destination fuel with zero emissions."

Cadent earlier this year also revealed plans for a GBP900 million ($1.2 billion) integrated hydrogen project.

The "HyNet" project would include construction of a hydrogen production facility in the northwest of England to supply hydrogen to power local industry -- such as oil refineries and manufacturing plants -- and heat homes.

Cadent said HyNet could be up and running by the mid-2020s with CO2 captured during the process of extracting hydrogen from gas stored in the soon-to-be decommissioned gas fields in Liverpool Bay off the northwest coast of England.

--Stuart Elliott, stuart.elliott@spglobal.com

--Edited by Alisdair Bowles, newsdesk@spglobal.com