Energy Bill [HL]

Written evidence submitted by Northern Gas Networks (NGN) (EB13)

1. About NGN

Northern Gas Networks (NGN) is the North of England’s gas distributor. We deliver gas to 2.7 million homes and businesses in the North East, Northern Cumbria and much of Yorkshire. Throughout the energy crisis, we have played a central role in ensuring that energy can continue to be delivered reliably and safely to all of our customers, who depend on our network in order to heat their homes and power their businesses.

We recognise, however, that we now need to play our part, alongside our energy partners, in delivering on the legal commitment to Net Zero by 2050.

At NGN, we have conducted world-leading research into the conversion of existing gas networks to convert to 100% hydrogen and are proud that our proposal for a hydrogen village trial has been shortlisted by Government.

Our evidence focuses on Chapter 2 of the Energy Bill, ‘Hydrogen Grid Conversion Trials’, which will enable the delivery of a hydrogen village trial.

We would encourage all Parliamentarians to take into account the following evidence when considering the relevant clauses of the Bill, and any amendments to those clauses.

2. Key points

· The Energy Bill contains clauses which are critical to enable the safe and effective delivery of a hydrogen village trial, which will feed into the 2026 Government decision on the use of hydrogen for heating.

· The creation of a ‘hydrogen village’ is cited in several government policy documents including the 10 P oint P lan for a G reen I ndustrial R evolution, the Hydrogen Strategy, the Energy White Paper and the Heat and Buildings Strategy .

· The hydrogen village is a scheme of national importance and will provide vital data and evidence to Government about the future use of the gas network.

· Chris Skidmore’s Independent Review of Net Zero, Mission Zero, reccomends that ‘Government should continue the hydrogen heating community trials, to inform decisions on the role hydrogen should play in heating’.

· The Climate Change Committee’s Hydrogen in a low-carbon economy report found that ‘hydrogen could play a valuable role as part of a heating solution for UK buildings’ and noted that trials and pilot projects for buildings will be required in order to ‘establish the practicality of switching to hydrogen’.

· NGN’s proposal for a hydrogen village trial in Redcar has the support of a robust majority of residents who have been surveyed, as well as the local MP, Mayor, and local authority.

3. Hydrogen for heating

In the UK, around 85% of homes are connected to the gas grid. In total, this is around 23 million connections. To achieve net zero, there is a recognition of the need to move away from fossil fuels, which create carbon when burned. One option is to switch the gas supplied through our pipes from the natural gas supplied today, to hydrogen. Repurposing the gas network to 100% hydrogen would maintain choice for consumers in the way that they heat their homes in the future. This element of choice is very important, as securing consumer support for the transition to Net Zero will be crucial if we are to maintain public support and confidence.

Electrification will play a key role in meeting our net zero targets, however, it is not possible to meet our energy needs through electrification alone. This is predominately due to seasonal demand and the need to have energy storage for when rewewable energy will not be available in sufficient quantities. Hydrogen can be used in the same way as natural gas, but it doesn’t create carbon when burned. Hydrogen offers the opportunity to transition to decarbonised energy, with less disruption than switching to full electric. It would reuse existing gas infrastructure, and ensure the continuation of a reliable and resilient energy system for the UK all year around.

4. Hydrogen village trial

The Government is due to make a decision on the potential use of hydrogen for heating in buildings in 2026. In order to inform this decision, the Government has committed to working with industry on a hydrogen community trial, followed by a village-sized trial of around 2,000 properties, expected to go live from 2025.

In 2021, NGN submitted proposals to lead a hydrogen village trial and create the UK’s first hydrogen village in Redcar. In 2022, our proposals were selected to proceed to the next stage of the project. A decision on whether the project will progress is to be made later in 2023.

The village trial will provide vital evidence about the realiability and resilience of a 100% hydrogen supply and the customer experience of using hydrogen in homes and businesses.

Proposals in the Energy Bill are critical to enable the safe and effective delivery of the village trial, which will feed into the 2026 Government decision on hydrogen heating.

5. Redcar Hydrogen Community

The Redcar Hydrogen Community is NGN’s proposal for a hydrogen village trial, where parts of Redcar would use locally produced, green hydrogen from 2025. The proposed area comprises around 2,000 homes and businesses in the town centre, Warrenby, Coatham and parts of Kirkleatham.

Redcar was chosen as the preferred location as there are already plans to produce green hydrogen in the area and this local hydrogen would not have to move far in order to benefit properties. There are also a wide variety of different housing stock and businesses who use gas for various purposes, so lea r ning can be maximised by converting different users.

Safety is fundamental. Before any community trial can go ahead, the Health and Safety Executive (HSE) will need to be satisfied that the use of hydoregn in the newtork is as safe or safer than with natural gas. Measures will be needed to ensure that hydrogen is stored, distributed and used in a safe way. No community trials will take place until all necessary safety assessments have been successfully carried out and no gas product will ever be installed or supplied to the public that is unsafe or carries unacceptable risk. We are confident that the societal risk of hydrogen will be broadly acceptable to the HSE and that in general terms the risk from hydrogen will be 10-7 (less than than one fatality per 10,000,000 of the population) which is comparable with the current societal risk of natural gas, and much lower than the societal risk from electricity networks.

Customers will have a choice of hydrogen or electric for heating and cooking , free of charge with servicing and maintenance. No-one in the area will be financially disadvantaged because they live in the hydrogen conversion area. No-one will be forced to convert their homes to hydrogen, as residents and businesses will be able to chose between hydrogen or electric appliances. It is not possible to continue using natural gas as the pipe network will be transporting hydrogen during the trial. This means the energy used in the hydrogen village from 2025 is compatible with net zero. We will never enter people’s homes without persmission unless there is a risk to their safety , just as is the case now with gas.

6. Community engagement and consultation

NGN recognises the crucial importance of early and ongoing community and stakeholder engagement around our proposals. It has been important for us to be accessible, which we have achieved through a presence in the local community, including a dedicated, high-visibility Hydrogen Hub on the high street. We have also involved the community in co-designing elements of our proposal, establishing a Citizen’s Panel of around 20 residents and landlords to help share our plans and test and develop our customer offer. We have offered visits to residents to our Hydrogen Home, which is the UK’s only home currently demonstrating 100% hydrogen appliances. This has helped demonstrate that hydrogen offers a very similar experience to natural gas.

We are proud to have the public support of the local MP, Mayor, and local authority for our proposed trial, as well as a robust majority of the residents who have been surveyed. For the public in Redcar, the opportunity of becoming the UK’s first hydrogen village is important in terms of investment and job opportunities.

The results of our consultation showed strong support for our propsopals. Based on 699 responses, we found that:

· 76% of respondents were positive

· 19% of respondends were neutral

· 5% of respondents were negative.

In addition:

· 89% of respondents would opt for hydrogen for heating

· 6% of respondents would opt for electric heating

· 5% were unsure.

May 2023


Prepared 7th June 2023