Government low-carbon grants support hydrogen supply and use cases

The government has awarded grants totalling £46 million to 26 businesses in three government competitions: the Industrial Hydrogen Accelerator Competition, the Red Diesel Replacement Competition, and the Industrial Energy Transformation Fund.
The Industrial Hydrogen Accelerator Competition resulted in two awards. The ‘Bay Hydrogen Hub – Hydrogen4Hanson’ project won £6.1 million to support decarbonisation of the asphalt and cement production industry and develop nuclear derived hydrogen production at the Heysham 2 nuclear power station. The nuclear plant will provide electricity and steam to an onsite solid oxide electrolysis cell electrolyser, to produce hydrogen. DESNZ said this will be a first-of-a-kind demonstration of hydrogen as a fuel at an asphalt plant, which has the potential for 3,300t of industry carbon savings per annum.
The ‘Hydrogen for the Decarbonisation of Sheffield Steel” project won £930,000 to assess the technical and commercial feasibility for end-to-end hydrogen production, transport and end-use in the steel manufacturing industry. The project is led by E.ON and is a partnership with Chesterfield Special Cylinders, Sheffield Forgemasters, Glass Futures and the University of Sheffield.
The Red Diesel Replacement fund awards also include several that would expand the use of hydrogen. The largest, at nearly £6.3 million, would see Catagen produce green hydrogen and e-diesel for industrial vehicles in Northern Ireland. Catagen co-founder and chief executive Andrew Woods said: “The pathway to decarbonise the off-road mobile machinery is difficult, these vehicles tend to be larger, built for extreme conditions, have long duty cycles and high-power demand. There is no one-size-fits-all solution, so we are delighted to be making this bold step with Terex and Wrightbus to develop an end-to-end decarbonised solution.” A £3.2 million project led by Ryze Hydrogen to develop modular hydrogen refuelling technologies.
Other grants from the Red Diesel Replacement Fund aim to help improve energy efficiency, including £4.9 million to a group led by Danfoss, which aims to reduce energy consumption of traditional excavators by up to 50%, by reducing energy losses and recovering waste energy.
The Industrial Energy Transformation Fund projects included Lunts Castings, which wants to move from using natural gas to install electric furnaces that can run from solar panels installed on its building and Bumble Hole Foods, which wants to expanding its solar PV generation and electrify its processes, including replacing gas and gas-oil steam boilers with a heat pump.

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