Large-scale CCS and hydrogen project launched

The transition to a low-carbon economy will require the development of projects that deliver innovation and learning. Cadent, the UK’s biggest gas distribution network, has been developing the recent HyNet North West project which aims to convert industrial sites in the North West of England to hydrogen, which is zero-carbon at point of use. Cadent has today published details of this project along with a Frontier report assessing how HyNet North West could be funded.

HyNet North West is a full-scale Carbon Capture & Storage (CCS) and hydrogen project situated in the North West of England. Carbon produced during the hydrogen extraction process will be captured and stored in offshore disused gas fields. Hydrogen will also be blended with natural gas and delivered to domestic users. The project aims to deliver innovation and learning across the CCS, heat and transport vectors over timescales compatible with meeting the UK’s 2050 climate targets. It has been estimated that HyNet North West will reduce carbon emissions by more than 1 million tonnes of CO2 per annum.

Frontier’s report identifies a number of barriers facing private sector delivery of the project. Because of the complexity of CCS and hydrogen processes and the scale of the project, there is no ‘off-the-shelf’ funding solution available. Since the benefits of decarbonisation are widely spread throughout society, funding the project from either general taxation or from energy customers, or a hybrid of such approaches, is likely to be most appropriate.

Frontier regularly advises government departments, regulators and private companies on issues around energy, climate change and decarbonisation.

For more information, please contact Saskia Nett on s.nett@frontier-economics.com, or call +44 (0)20 7031 7000.

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