Hydrogen industry in line for a slice of new multi-billion-dollar UK government cash pot

The UK government has designated the hydrogen industry as one of eight "key" sectors to receive a significant portion of the newly announced £4.5 billion ($5.6 billion) funding initiative aimed at stimulating economic growth and fostering supply chains. Alongside five other energy-related sectors—carbon capture, utilization, and storage (CCUS), nuclear, offshore wind, and power grids—hydrogen will compete for a share of £960 million from the overall funding pool.

While specific details about the allocation of funds to the hydrogen industry remain limited, it is evident that the UK's automotive sector will receive the largest portion, with £2 billion earmarked for developing supply chains and manufacturing capabilities for zero-emissions vehicles. Although hydrogen-powered vehicles may be included, the focus is expected to predominantly center on battery-electric vehicles.

In conjunction with this funding initiative, the government plans to establish a "hydrogen industry taskforce" in collaboration with the Hydrogen Innovation Initiative and Innovate UK, the UK's research and development funding entity. The taskforce's primary goal is to "maximize investment opportunities for UK manufacturing of hydrogen propulsion systems," according to the Department of Energy Security and Net Zero (DESNZ). This implies potential funding for factories involved in manufacturing hydrogen fuel cell vehicles and hydrogen internal combustion engines (ICE).

One notable player in this space is JCB, a prominent UK construction vehicle company. With chairman Anthony Bamford, a significant donor to the ruling Conservative party, JCB has invested in hydrogen ICE manufacturing capabilities at its Derbyshire factory. The company claims to have already installed over 70 hydrogen ICEs in its heavy machinery. Additionally, the UK is home to Wrightbus, a bus manufacturer based in Northern Ireland, which has made strides in hydrogen propulsion technology following its acquisition by H2 producer Ryze Hydrogen, owned by Jo Bamford, Anthony's son.

Claire Coutinho, the Minister for Energy Security and Net Zero, emphasized the government's commitment to supporting green industries, announcing nearly £1 billion to bolster these sectors. While the UK has attracted £200 billion in low-carbon investment since 2010, with an additional £100 billion expected by 2030, this new funding initiative aims to unlock further opportunities for growth.

The two remaining sectors identified as "key" beneficiaries of this funding are aerospace, allocated £975 million to support development, and life sciences, granted £520 million to enhance the UK's resilience to future health emergencies and undertake other projects.