The Economic Impact Assessment for the Hydrogen Sector to 2030 paper takes into account the UK Government’s ambition of producing 10GW of low-carbon hydrogen by the end of the decade, with production itself potentially accounting for 8,500 jobs and £2.9bn (£3.6bn) GVA.

The study has identified that there will be a higher concentration of benefit in regions that have historically received lower levels of investment, for example, Tees Valley and Scotland.

Hydrogen UK stated that the sector can only achieve its findings if the government continues to collaborate and progress on the deployment of low-carbon hydrogen projects. With significant milestones in 2023, including the Low Carbon Hydrogen Agreement, the UK “must now move from initial policy design to delivery for momentum to be maintained.”

Jamie Mitchell, Hydrogen UK’s Lead Analyst on the report, claimed the period leading up to 2030 will be a critical time to “seize the economic opportunity presented by [the] low-carbon hydrogen sector.”

Mitchell added, “For the benefits outlined in our study to be realised, government and industry must continue to collaborate and make progress in the deployment of novel low-carbon hydrogen projects.”

Across all the sub-sections of the hydrogen industry, electrolytic hydrogen production is predicted to bring in £5.6bn ($7bn) GVA – £2.3bn of this direct – whilst CCUS-enabled production would achieve over £4.3bn ($5.3bn) in cumulative total GVA (£1.7bn direct).

In comparison, the heating and distribution sectors are forecasted to be under £1bn in GVA by 2030. Likewise, there will be very low levels of end-use employment associated with hydrogen heat by 2030. The government is currently committing to a strategic decision surrounding UK heat in 2026.

A recent study found that using a 20% hydrogen blend in household cooking hobs and boilers resulted in an increased number of leakages when compared with traditional solutions.

Read more: Study reveals increased gas leaks with 20% hydrogen blend in home

Hydrogen UK has also recommended the Low Carbon Agreement should be refined to ensure risks within the Hydrogen Production Business Model “can be adequately managed between government and industry.”

The report adds, “Lowering the risk of projects would reduce financing costs and therefore total subsidy cost for government. This could be achieved in part by unlocking blending, as a reserve off-taker, subject to safety assessments.”