How Scotland could be a major player in future hydrogen industry

Could hydrogen be the key to Scotland achieving net zero? Our hydrogen, energy and low carbon specialists share their thoughts.

Written by David Holman and Meinolf Otto

The energy transition challenge

Energy needs are at the root of the challenges with climate change. The world does not currently use enough clean, green energy sources to meet all our requirements. Although many countries have now committed to phase out fossil fuels and reach net zero by the middle of the 21st century, the acceleration of demonstration and commercial clean technologies alongside clear policy and regulation change, over the next 10 years, are essential if we're to reach these targets.

Scotland has set ambitious targets to become carbon neutral by 2045. This is more ambitious than the UK Government which has targeted achieving this 5 years later than Scotland.

This is a challenging target, and the Committee on Climate Change (CCC) has identified that, starting in the 2020s, hydrogen alongside carbon capture usage and storage (CCUS) are two technologies that are going to be essential to its achievement.

Hydrogen is a big part of the solution. It offers the only real tangible zero carbon energy vector* that can decarbonise some of our more challenging sectors and help Scotland (and the world) reach net-zero targets within the next 20-30 years. 

*only zero carbon if produced from renewable energy sources

Why hydrogen is the renewable energy answer

Given Scotland’s vast energy resources, as well as our supply chain, skills, infrastructure and geography, we can produce hydrogen at scale. We can use onshore and offshore wind and other marine energy resources (green hydrogen), as well as steam reformation of natural gas with CCUS (blue hydrogen) linked to our existing and extensive energy infrastructure.

In fact, not only do we potentially have enough clean energy resources to produce hydrogen for our domestic needs, we have the capability of producing hydrogen for export to other markets either by ship or pipeline.

Hydrogen has been identified as a clean energy vector. It is an essential "tool in the box" that can help decarbonise industry, heat and transport as well as act as a large-scale energy store to balance the intermittency of renewable power generation.

To embed hydrogen into our economy and energy system, the next ten years are critical in:

  • Developing the knowledge and skills of our supply chains
  • Increasing innovation and commercialisation of key technologies
  • Demonstration and deployment of hydrogen projects across these sectors

Scotland: A global hub for hydrogen technologies and production

"There are many reasons that Scotland is the right choice for companies looking to develop hydrogen energy solutions. None more so than the fact that we have the raw energy potential and infrastructure to support the move towards the production and management of green and blue hydrogen at scale. With large quantities of hydrogen produced, it provides the potential to export the excess hydrogen to other markets."

David Holman, Hydrogen and CCUS Specialist, Scottish Enterprise

David Holman, Hydrogen and CCUS Specialist, Scottish Enterprise

Beyond exports from Scotland and on top of our own growing domestic needs, there is also a growing interest from companies around the world who need green hydrogen as feedstock. Companies will need to locate, and set up production facilities in Scotland, in order to be close to the generation. Energy hubs in Aberdeen, Cromarty Firth, and on Shetland are looking to accommodate these new investments.

What is critical in terms of moving towards commercial deployment is the balance between supply and demand, as well as scale and cost reduction in what are still relatively novel and innovative technologies. Through our existing supply chain and growing expertise, we are also open to collaboration and export of our knowledge and skills.

A range of hydrogen projects are already underway across Scotland, demonstrating the breadth and scale of Scotland’s ambition in hydrogen across the whole energy system.

The following map gives a snapshot of just a few of the projects active in Scotland just now. Click on the map pins for project details:

"Scotland offers one of the best opportunities for industrial scale clean hydrogen production in Europe. We welcome you to join us in developing one of the most sizeable clean hydrogen generation ecosystems in Europe."

Paul Wheelhouse, Scotland's Energy Minister

Industry recognition that hydrogen will be a critical part of our future global energy mix is driving more collaborative longer-term projects of scale such as the Orion Energy Hub in Shetland and the Cromarty Firth Energy Hub.

These projects are focused on the:

  • Massive offshore wind energy development pipeline underway around Scotland’s coasts
  • Transition of the oil and gas industry to renewable energy
  • Potential decarbonisation of the gas grid for heat and industrial usage
  • UK’s roadmaps towards industrial decarbonisation
  • Anticipated ramp up in deployment of hydrogen vehicles

Other projects that align to those above are connected to the future trade of hydrogen from Scotland, whereby the conversion of hydrogen into transportable solutions for shipping around the world (and for the ships themselves) needs to be developed.

Scotland: the right choice for hydrogen production opportunities 

Reasons why Scotland has the potential to be a world leader in hydrogen production include: 

Scotland is:

  • A world leader in wind energy with huge growth planned for the industry
  • Working towards the first deployed carbon capture and storage (CCS) project in the UK linked to the production of blue hydrogen at St Fergus in the North East of Scotland
  • An existing large-scale energy exporter for electricity, oil and gas

Scotland has:

  • Existing offshore oil and gas infrastructure that can be refurbished
  • Existing offshore wind industry and projects of scale
  • The largest seascape Exclusive Economic Zone of any country in Europe except Norway
  • One of the best wind resources in the world in the North Sea
  • An existing highly skilled offshore wind and oil and gas industry workforce and supply chain in place
  • A growing network of industrial hydrogen hubs in development to accommodate industrial scale production and deployment

What Scotland can do for you

The benefits to your business on having hydrogen operations in Scotland include: 

  • Being part of a huge global hydrogen opportunity that is only going to get bigger
  • The ability to access a pool of highly skilled talent
  • The ability to access funding to support technology development and diversification
Aerial image taken at European Offshore Wind Development Centre, Aberdeen Bay

Financial incentives

There are also a range of financial incentives open to companies looking to develop solutions for energy transition, including:

Get involved now

There are various business consortia in Scotland driving towards finding hydrogen solutions, with which we can facilitate connections. They include consortia focused on hydrogen or those involved in offshore or onshore wind to carbon capture and storage.

If you're interested in your business being part of these consortia or if you are looking to invest in Scotland, get in touch. 

Energy supply chain webinars

Scotland's energy transition

Join our energy experts to hear about opportunities in Scotland’s transition towards net zero emissions.

Wednesday 2 December, 3pm-4pm GMT

Hydrogen in Scotland

Find out why Scotland has one of the best ecosystems for the hydrogen economy in Europe - green hydrogen at an industrial scale for a zero-carbon future. 

We’ll connect you to the right partners in Scotland and welcome you and your organisation to join us on this exciting, positive climate-impacting journey.

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