Source · Select Committees · Public Accounts Committee
Recommendation 6
6
Rejected
Set out how to test hydrogen for heating across all property types for informed decisions.
Conclusion
DESNZ’s work to test hydrogen for heating has been beset with problems, with key trials cancelled. DESNZ has committed to deciding on the role of hydrogen for heating in 2026. Major trials intended to support its decision have been cancelled or delayed due to local opposition and insufficient supply of hydrogen. It has not tested the role of hydrogen in non-domestic properties. At the time of our evidence session in April 2024, an announcement on a successful bidder for a hydrogen town, planned for the end of this decade, had been delayed by 13 months. Since then, DESNZ has announced that it will not progress work on a hydrogen town pilot until after 2026, thereby meaning information on the pilot will not feed into its decision on hydrogen’s role due in 2026. Overall, this absence of the evidence needed to support any decision is also creating uncertainty for industry to plan and invest on a wider scale and could hamper overall progress. Early planning for any decommissioning of the gas networks, if it is decided that hydrogen has a limited role and electricity becomes the main energy source, is vital to manage costs that we have seen passed to the taxpayer with decommissioning in other sectors, such as nuclear, and oil and gas. Recommendation 6a: DESNZ should, as part of its Treasury Minute response, set out how it will test hydrogen for different types of properties, including domestic and non-domestic properties, so it can make an informed decision on the role of hydrogen for heating. Recommendation 6b: DESNZ should, by end-June 2025, set out how it will undertake any required decommissioning of the gas networks, including how it will be funded.
Government Response Summary
The government explicitly disagrees with the recommendation to set out decommissioning plans by June 2025, stating that a full assessment will require more time due to the complexity and uncertainty of future energy scenarios.
Government Response
Rejected
HM Government
Rejected
The government disagrees with the Committee’s recommendation. The department disagrees with the recommendation as a full assessment will require more time than proposed by the former Committee. However, the department acknowledges that there are a range of scenarios which achieve net zero by 2050 with differing implications for the gas system and are currently exploring ways to facilitate the transition to a secure, affordable, low-carbon gas system in these scenarios. This work involves understanding the likely supply and demand needs of natural gas in the future and identifying what this means for the gas system and infrastructure, including the extent to which decommissioning is required for parts of the gas network that cannot be used or repurposed. This work will also consider how to lead the system through the decommissioning process, the technical aspects required to deliver decommissioning, and how to pay for it. Modelling and understanding these different scenarios is complex given the number of variables at play (for example, uncertainty regarding the supply and demand for hydrogen, carbon capture, usage and storage (CCUS) and biomethane), and will depend in part on policy decisions yet to be made. For example, on the use of hydrogen for heat. The department will continue to work with regulators and industry to understand what decommissioning will be needed in different scenarios, and how best to deliver it.