While the technology faces significant challenges such as high production and capital costs, storage, transportation and its relatively early stage of market maturity, these hurdles also highlight areas for innovation and development.

Once the primary infrastructure gaps are addressed, there is the potential to significantly accelerate hydrogen’s growth and the UK’s journey towards net zero. Here are the top five areas that need to be addressed:

1. Establishing production facilities: Building large scale hydrogen production facilities, whether through electrolysis (green hydrogen) or reforming processes (blue hydrogen), presents a significant opportunity for growth. In the UK, the scarcity of hydrogen production facilities highlights a unique market potential. While the initial capital costs are high, there is an opportunity for visionary investors to lead the way, shaping the future of hydrogen energy by positioning themselves as early adopters and pioneers in an emerging industry.
2. Developing transportation networks: The hydrogen pipeline network is considerably smaller than the extent oil and gas pipelines globally, with estimates suggesting there are about 4,500 kilometres of dedicated pipelines worldwide, compared to over 2 million kilometres of hydrocarbon pipelines. Many countries plan to expand their hydrogen networks as part of their strategies to transition to cleaner energy sources. The EU, for example, has outlined plans to develop a significant pipeline network as part of its Hydrogen Strategy. Additionally, some of the existing natural gas pipelines are being considered for retrofitting to support the future transport of hydrogen.
3. Expanding refuelling stations: Hydrogen powered HGVs and buses are an innovative and sustainable solution to reducing carbon emissions in the transportation sector, offering longer ranges and quicker re-fuelling times compared to battery-electric vehicles. However, the lack of existing refuelling stations, particularly in urban areas and along major transport routes, complicates their widespread adoption. Addressing this infrastructure gap through strategic investments and efforts from government and industry is essential for enabling the extensive deployment of hydrogen powered transportation.
4. Enhancing storage facilities: Ensuring a reliable hydrogen supply during peak demand opens up opportunities for developing advanced storage solutions, such as underground caverns and above ground tanks. These innovations not only promise to enhance energy security but also stimulate technological advancement. Addressing technical, safety and legal aspects of hydrogen storage paves the way for establishing robust and reliable systems, thereby boosting confidence in hydrogen as a reliable energy source. 
5. Developing regulatory frameworks: As well as enhancing physical infrastructure, improving legal and regulatory frameworks can further accelerate hydrogen market growth. The Labour Party’s manifesto stated: “We will invest in carbon capture and storage, hydrogen and marine energy, and ensure we have the long-term energy storage our country needs.” These investments have the potential to build a strong foundation for the future of the industry, bridging the cost gap between hydrogen and other renewable energy sources.

Addressing these challenges requires coordinated efforts from government, industry and stakeholders to stimulate both demand and investment in hydrogen infrastructure. Overcoming these obstacles is essential if hydrogen is to establish itself as an individual market and achieve its manifestation as the ‘future of fuel’.

Further information

Contact Nick Green or Georgia Taylor

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