The APEX (Alternative Power for Equitable Communities) project will introduce an innovative method for localised and community-centred energy systems. It aims to leverage the capabilities of power-to-hydrogen (PtH2) technology within community settings while exploring forthcoming whole systems future energy scenarios that optimise the utilisation of current gas infrastructure.
This concept revolves around harnessing excess, local renewable energy to produce hydrogen through electrolysis, strategically integrated to amplify energy flexibility and lower energy costs. The innovation will incorporate green hydrogen into the existing infrastructure, thus contributing significantly to sustainable development and the transition to low-carbon, place-based community heating schemes. The project will help with shaping the future of how hydrogen can integrate with community energy systems in line with the UK’s vision of a Just Transition to Net Zero.
Benefits
Future Network Planning
- Optimisation of existing gas distribution infrastructure and introduction of innovative pathways for networks to adapt and thrive in a sustainable energy landscape.
Network Resilience
- Integrating renewable energy storage capabilities through PtH2 technology, the energy network becomes more resilient. It can better manage fluctuations in energy supply and demand, reducing the risk of grid failures and ensuring a reliable energy supply for all consumers.
Whole Energy Systems
- The project encourages cross-sector integration by exploring the repurposing of gas infrastructure for electrification and other use cases. This promotes the efficient utilization of existing assets, leading to a more integrated and optimized energy network.
Reduced Strain on Electricity Grid
- The project's ability to utilise surplus local renewable energy and redistribute it as hydrogen eases the strain on energy grids during peak demand. This reduces the likelihood of overloading the grid and enhances its overall stability.
Community Partnerships
- The project fosters partnerships with local government bodies, research institutions, and community organizations. These collaborations bring valuable insights, technical expertise, and community engagement, strengthening the energy network's relationships and ensuring the project's success.
Reduced Energy Bills
- Integrating power-to-hydrogen (PtH2) technology into community heat networks, the project will explore optimal approaches to reducing reliance on conventional energy sources, with the aim of reducing pressure on energy bills for consumers.
- Exploring the efficient use of surplus local renewable energy for hydrogen production, the project will aim to reduce pressure on costs for heating and hot water, with the potential for cost savings.
Stable and Reliable Energy Supply
- One of the key benefits is the assurance of a stable and reliable energy supply. Even during peak demand, PtH2 technology ensures a consistent source of energy, guaranteeing that consumers have access to heating and hot water when they need it most. This reduces the inconvenience and discomfort associated with energy supply interruptions.
CO2 Reduction
- The project's focus on green hydrogen drastically reduces the carbon footprint of community heating systems. By transitioning from traditional fossil fuel heating to hydrogen, consumers contribute to a greener environment and a reduction in harmful emissions, making their communities healthier and more sustainable.
Inclusivity and Community Empowerment
- Community engagement is an integral part of the project. Consumers have the opportunity to actively participate in shaping the energy solutions for their communities. This inclusivity fosters a sense of ownership and empowerment, allowing residents to have a direct impact on their local energy systems.
Learnings
Outcomes
Almost all hydrogen production, storage and distribution methods, and use cases considered have a TRL of 9. The exception to this was line packing for storage, which was not considered, pure hydrogen (as opposed to blended with natural gas) in high-grade heat, which has a TRL of around 5, and captured electrolyser waste heat for DH networks, with a TRL of around 4.
Ammonia, refining, and chemicals proved to be prime targets for green hydrogen deployment, since they already use grey hydrogen as feedstock in their processes and therefore have a mature hydrogen value chain. Shipping could also play a role as a hydrogen off-taker, either as a pure fuel for fuel cells or ICEs, or via e-fuels such as green methanol, which is produced by combusting green hydrogen with biogenic or captured CO2.
Hydrogen transport for HGVs could be a small to medium use case for green hydrogen due to its lower mass, longer range, and shorter refuelling time when compared to battery electric vehicles.
These findings indicate that the industrial community is a prime contender for further research, with use cases in nearly every offtake area and applicability across all scenarios. Rural and urban communities will require a more targeted approach to design a bespoke hydrogen system that takes advantage of local renewable energy sources and infrastructure for optimal project economics.
Key Findings
The model and analysis identified socio-economic and technical distinctions among the three investigated locations:
· North Humber: Identified as the most economically viable location, yielding an Internal Rate of Return (IRR) of 12% and a Net Present Value (NPV) of £24 million. This is attributed to its robust infrastructure for hydrogen storage and significant demand from local off-takers.
· Alnwick: Benefits from access to potentially low or no-cost curtailed electricity and achieves a positive IRR of 1%; however, the economic outlook is constrained by a negative NPV of £7 million, reflecting limited social benefits and natural storage assets. However, there is potential HGV off-taker demand, which could provide a focused market for hydrogen production.
· Leeds: Displays the least favourable economic conditions, with an IRR of -2% and an NPV of -£13 million, primarily due to higher operational costs and less advantageous hydrogen production environments.
Sensitivities
The analysis further provides critical insights into the economic viability of PtH2 systems across the locations:
- North Humber: Profits significantly from the availability of local renewable electricity and existing infrastructure which, collectively enhance both economic viability and social benefits. This enables the scenarios of no subsidies still achieving financial feasibility in the model.
- Alnwick: Shows potential for strategic adjustment, focusing on electrolysis utilising local renewable energy sources, without the necessity for extensive storage solutions. The presence of HGV traffic offers a targeted opportunity for immediate hydrogen off-taking.
Lessons Learnt
The findings exemplify how strategic deployment of PtH2 systems could apply the APEX project framework:
- North Humber: Stands out as a strong candidate for immediate investment due to its established infrastructure and high economic returns, making it suitable for scaling up PtH2 implementations. Further variations of technology and costs can be used to develop project plans.
- Alnwick: Could serve as a model for pilot projects that capitalise on local renewable resources and potentially exploit the HGV off-taker demand, setting a precedent for similar rural areas.
- Leeds: Offers valuable lessons on the complexities faced by urban centres, indicating a need for innovative approaches to system design and financial structuring to manage higher costs and operational challenges.
