UK government unveils new Industrial Decarbonisation Strategy

Building on Prime Minister Boris Johnson’s 10-point plan for a green industrial revolution published last year, the UK government has unveiled a new Industrial Decarbonisation Strategy that aims to deliver what is claimed will be the world’s first low carbon industrial sector and over £1bn to cut emissions from industry, schools and hospitals.

The new strategy will be underpinned by supporting existing industry to decarbonise and encouraging the growth of new, low carbon industries in the UK to protect and create skilled jobs and businesses in the UK, as well as giving businesses long-term certainty to invest in home-grown decarbonisation technology, such as that which can capture and store carbon emissions from industrial plants, rather than outsourcing industrial activity to high-emission countries around the world, according to Business and Energy Secretary Kwasi Kwarteng.

The blueprint also includes measures to build on the UK’s efforts in moving towards greener energy sources, with an expectation of 20 TWh of the UK industry’s energy supply switching from fossil fuel sources to low carbon alternatives by 2030 – helping industry to increase its use of low carbon energy sources to around 40% of industry’s total energy consumption.

To kick start the process, £171mn from the Industrial Decarbonisation Challenge has been allocated to nine green tech projects in Scotland, South Wales and North West, Humber and Teesside in England, to undertake engineering and design studies for the rollout of decarbonisation infrastructure, such as carbon capture, usage and storage (CCUS) and hydrogen.

A further £923mn is to be directed to 429 projects across England aiming to reduce carbon emissions from public buildings including hospitals, schools and council buildings. The Public Sector Decarbonisation Scheme funds low carbon heating systems, such as heat pumps, and energy efficiency measures like insulation and LED lighting.

New rules on measuring the energy and carbon performance of the UK’s largest commercial and industrial buildings are also to be introduced in England and Wales. The move could provide potential savings to businesses of around £2bn/y in energy costs in 2030 and aims to reduce annual carbon emissions by over 2mn tonnes – approximately 10% of the current emissions from commercial and industrial buildings, according to the government.

The projects securing £171mn from the Industrial Decarbonisation Fund include:

North West (Merseyside)
The HyNet North West hydrogen energy and carbon capture, usage and storage (CCUS) project will receive almost £33mn funding for two projects that aim to transform the north-west of England into a low carbon industrial cluster by 2030 – including Liverpool, Greater Manchester, Cheshire and North Wales. The projects are aiming to reduce CO₂ emissions by 1mn t/y from 2025, rising to 10mn t/y from 2030.

Scotland (St Fergus, Aberdeenshire)
Over £31mn will go to Scotland’s Net Zero Infrastructure project, funding offshore and onshore engineering studies connecting industrial sites across east Scotland with access to safe carbon storage resources deep below the North Sea. The programme of new work and reusing infrastructure is expected to provide a significant boost to the region’s fast-growing low carbon credentials, paving the way for onshore and offshore developments totalling in excess of £3bn, helping Scotland transition away from oil and gas, creating and securing tens of thousands of jobs by 2050.

Teesside
Net Zero Teesside and the Northern Endurance Partnership will receive over £52mn for two projects that aim to decarbonise the Teesside industrial cluster in the mid-2020s. The projects include a world-first flexible gas power plant that uses CCUS and complements renewable energy, to create an offshore CO₂ transport and storage system. It is claimed that, together, the projects could capture around 2mn t/y of CO₂ from 2026, decarbonise 750 MW of power and reduce the region’s industrial emissions by a third.

Humber
Over £21mn will go to the Zero Carbon Humber Partnership project, which aims to turn the Humber region into a net zero cluster by 2040. The project’s vision is to deliver H2H Saltend, one of the world’s first at-scale low carbon hydrogen production plants on the north bank of the Humber, and CO₂ and hydrogen pipelines enabling industrial sites and power stations across the Humber to switch to hydrogen and/or capture and transport their emissions.

A further £12mn-plus will be awarded to project Humber Zero, which plans to decarbonise the industrial complex at Immingham, North East Lincolnshire, by creating a carbon capture and hydrogen hub, providing cost-effective and low carbon energy supply and storage opportunities to industry and the National Grid.

With the Humber region creating 40% of the UK’s industrial emissions, these projects aim to capture 25mn t/y of carbon every year.

South Wales
Nearly £20mn will go to the South Wales Industrial Cluster, which aims to create a net zero industrial zone from Pembrokeshire to the Welsh/English border by 2040. The project will look at options to support the deployment of hydrogen across regions and to develop CCUS.

South Wales industry currently produces nearly 9mn t/y of carbon – 12% of UK’s industry’s total.