Skip to main content
Perspective:
Perspective
07 Feb 2022

Zero in on... Hydrogen

It’s clean, powerful and abundant in nature.

Switching to cleaner hydrogen energy in several sectors can meaningfully support the transition to a net zero future.

Hydrogen can offer a clean energy solution to parts of the economy that are difficult to decarbonise. Think industrial processes, industrial and domestic heat and hard-to-electrify transport (such as heavy-duty vehicles or ships).

Although it is the most abundant element in the universe, hydrogen must be produced by separating it from other elements in water and fossil fuels. While producing it requires energy, hydrogen is emission-free at the point of use.

The immediate challenge is how to scale-up production of hydrogen as an energy source and bring down the price. To do this, low carbon hydrogen must move up the policy agenda to catalyse investment and infrastructure, and create a competitive market.

According to the Hydrogen Council, in a net zero world demand for clean (renewable and low carbon) hydrogen could increase from 90 million metric tons (MT) today to 660 MT in 2050, making up 22 per cent of the final energy demand globally then.

But how can hydrogen support your net zero journey?

Five things you need to know about hydrogen

Why does an invisible gas have so many colours? It all comes down to the different sources and the way hydrogen is produced. Some processes create more greenhouse gas (GHG) emissions than others, so scientists have attributed colours to distinguish the difference – the primary ones being:

Grey hydrogen: generated from natural gas or methane through a process called steam reforming, producing GHG emissions. Most of today’s hydrogen use is grey;

Blue: during the steam reforming process, a high proportion of carbon generated is captured and stored underground. It is classified as low carbon hydrogen;

Green: made by using electricity from renewable sources to split water molecules into hydrogen and oxygen. This is classified as carbon free hydrogen.
Hydrogen is exciting because it can be used in several sectors. Its most likely uses are as a clean chemical feedstock or energy source in certain hard-to-abate sectors. There are also lots of ways to produce it. And, as it becomes more widely used, costs will inevitably come down.

To achieve net zero, renewables will have to provide a greater share of global electricity. However, renewable energy production fluctuates depending on the weather. In this context, any excess electricity could be used to produce green hydrogen, which then becomes a form of renewable energy storage.
Hydrogen is versatile because it can be used as a fuel source in several sectors and can be compressed into gas or liquefied to make it easier and cheaper to transport. Currently, most hydrogen is used in chemical plants or refineries and it is grey. If this were replaced with blue or green hydrogen, it would cut carbon emissions significantly.

Hydrogen also offers a solution for net zero home heating. While electrification has received a government policy boost in the UK, electric heat pumps may not suit all properties. Hydrogen could be a solution depending on location, cost and availability of supply. In future, it may be simpler and easier to replace a gas boiler with a hydrogen-ready one.

Hydrogen has a role to play in transport, too, especially in hard-to-electrify segments such as the heavy-duty freight, trains and buses on certain routes, ferries and ocean-going shipping. However, it could be decades before any hydrogen-fuelled aeroplanes can be spotted in the sky.
We are seeing the green shoots of a worldwide hydrogen market. Strong government support and ambitious decarbonisation policies make the European hydrogen market the fastest growing and potentially the largest. But some of the biggest projects that have been announced recently are in parts of Asia, North America and the Middle East.

The UK hydrogen market development is progressing at pace. Its own hydrogen strategy explaining how the Government will support innovation and stimulate investment was published in August 2021. The announcement of the first two industrial clusters (of four) soon followed. These will enjoy government support to produce blue hydrogen at scale to create a market. Over time, green hydrogen energy is expected to replace blue hydrogen.
There could be advantages for early adopters, so if you are interested in hydrogen:
  1. Collaborate. Sign up to a trade association, join the debate and follow the market to learn about the opportunities
  2. Explore how your business can use hydrogen as an energy source in the future
  3. Consider what products and services you can create to participate in the nascent hydrogen market in the future
  4. Share your skills and experiences from existing projects to support new ones

Keep learning

For more insight and inspiration on how to approach your net zero journey, explore our collection of articles below.

Did you find this useful?

Yes
No

Thanks for your feedback

If you would like to help improve Deloitte.com further, please complete a 3-minute survey

Your feedback is important to us

To tell us what you think, please update your settings to accept analytics and performance cookies.

Need help updating cookies?

Our thinking

Hydrogen Investing: Ready, Set, Net-Zero | Deloitte UK

Hydrogen investing could play a key role in achieving the UKs net-zero goals and provides a huge opportunity for forward-thinking businesses.
Analysis
minute read

Climate Exchange

Explore Deloitte’s thinking — a collective exchange of ideas to inspire genuine action on climate impact and climate change. 
Collection

Net Zero Guidance: Our Top Five Tips | Deloitte UK

Our net-zero guidance can help businesses make great strides in reducing their carbon emissions, leading to a greener, more sustainable future.
Perspective
10 minute read

Towards net zero, together | Deloitte UK

Welcome to our hub for all things climate change, where you’ll find lots of resources and ideas to help you take action where it matters most.
Collection
Explore our thinking