Costs of converting gas network to rival product too expensive for private investors to shoulder alone, energy group adds

Hydrogen is an expensive and inefficient way to heat buildings, according to a new report out today that concludes there are cheaper and more reliable ways to meet the UK’s net zero carbon targets.

The report, published by the London Energy Transformation Initiative (LETI), says heat pumps powered by renewable electricity are six times more efficient for space heating than using the same power to make hydrogen to fuel boilers using electrolysis.


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The report says hydrogen is six times less efficient for space heating than renewable electricity

It says the costs of converting the gas network to hydrogen is unlikely to prove attractive to private investors as the risks are much greater than switching to all electric infrastructure. This would require government support at a time when budgets are being squeezed by the costs of the covid-19 pandemic.

By contrast, renewable electricity is largely funded by private investors as it has known costs and proven investment returns so is a much cheaper way of producing power to heat homes.

Boris Johnson’s 10-point plan to green the UK’s economy, which was published last November, sets out its ambitions to produce 5GW of low carbon hydrogen production capacity by 2030 including as a home heating fuel. It says producing low carbon hydrogen will be made possible by carbon capture and storage.

The report concedes that producing hydrogen from natural gas using steam reformation is more efficient than electrolysis but concludes that heat pumps are three times more efficient.

And it adds that carbon capture and storage technology is unproven and that significant amounts of greenhouse gases would continue to be emitted until the technology was shown to work and implemented at scale.

The report is scathing about diluting the gas supply with 20% of hydrogen to reduce its carbon intensity, describing this as a “technological dead end”.