Energy and commodities markets information, benchmark and analytics provider S&P Global Platts announced today the launch of the first suite of hydrogen price assessments for the UK, marking another step in the development of the hydrogen market in the country.
Jeffrey McDonald, Hydrogen Pricing Specialist at S&P Global Platts, said:
“We are pleased to strengthen our global suite of Hydrogen prices with new UK Hydrogen assessments, that are in response to requests from market participants to understand the cost of Hydrogen production in the UK. The UK has significant plans and investment aimed at accelerating Hydrogen production and consumption as part of its 2050 Net Zero carbon plan, and hydrogen continues to attract interest from investors, policymakers and energy market participants as a carrier for clean energy.”
Hydrogen is viewed as one of the key building blocks of the transition to a cleaner energy future, given its ability to act both as a clean energy carrier and fuel, as well as a CO2-neutral feedstock for the production of green chemicals.
The element represents a key focus of the UK’s decarbonization plans. In November 2020, UK Prime Minister Boris Johnson unveiled his 10-point plan for the country’s Green Industrial Revolution as a central part of the UK plan to transition to a net zero economy by 2050 or earlier. One of the key areas of the plan was the for the development of hydrogen production capacity, with a 2030 target for 5GW of low carbon hydrogen capacity for industry, transport, power and homes.
Since Johnson’s announcement, several investment and energy companies have started plans to develop hydrogen capacity in the country. In December, Macquarie’s Green Investment Group and gas network company SGN announced plans to explore the potential for a hydrogen super-hub in the Port of Southampton, on the south coast of the UK, and earlier this month, energy giant bp launched plans for a blue hydrogen production facility located in Teesside in north-east England, with production capacity targeted at 1 GW by 2030.
Platts stated that its new price assessments are being launched amidst a growing requirement from market participants for independent price references as the energy sector seeks to understand the economics of a clean-energy future.
“The sheer momentum around the UK’s hydrogen developments includes both the technological capacity of the energy system to blend hydrogen into its existing gas and industrial networks, along with the drive around decarbonization. We are pleased to introduce new cost of production assessments evaluating hydrogen as a fuel through multiple production pathways.”