Three green hydrogen projects, totalling 31.8MW of capacity, have officially signed funding agreements for UK Government revenue support.
The funding comes through the UK’s Hydrogen Allocation Round 1 (HAR1) initiative, which provides revenue support via the Contract for Difference (CfD) mechanism, ensuring price stability and incentivising low-carbon hydrogen production.
11 projects were selected for HAR1 in total – representing £2bn ($2.5bn) in revenue support – with the remaining eight expected to receive contracts in “early 2025.”
Scottish Power and Storegga’s 10.6MW Cromarty Hydrogen, Scottish Power’s 7.1MW Whitelee Green Hydrogen and MorGen Energy’s 14.2MW West Wales have all signed contracts with the Low Carbon Contracts Company (LCCC).
The projects secured a strike price of £241/MWh ($307/MWh), which is just over £9/kg ($11.48/kg of hydrogen – through the Hydrogen Production Business Model (HPBM). Additionally, over £90m ($114.8m) from the Net Zero Hydrogen Fund (NZHF) had been allocated to support their construction.
“These projects are helping our mission to make Britain a clean energy superpower, ensuring hydrogen will become an important part of the UK’s future energy mix,” said Industry Minister, Sarah Jones.
Describing the three signed contracts as a “landmark achievement” for the UK hydrogen sector, Clare Jackson, CEO of Hydrogen UK, said it demonstrates confidence and commitment from both government and industry.
Despite the praise of the first three contracts, they came over 12 months after the projects were shortlisted for funding. All the contracts were originally expected to be signed in Q1 2024, with the delays fuelling concerns.
Read more:12 months, no action: UK’s £2bn hydrogen projects stuck in limbo
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