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The Future of Gas: Hydrogen, Biomethane, and Decarbonisation

By Admin UserMay 7, 20225 min read
The Future of Gas: Hydrogen, Biomethane, and Decarbonisation

Introduction

While electricity often dominates the net zero conversation, gas remains central to the UK’s energy system—heating over 80% of homes, fuelling industry, and underpinning electricity generation. Decarbonising gas is one of the toughest challenges on the road to net zero. In this article, I’ll explore the future of gas in Great Britain, focusing on the roles of hydrogen, biomethane, and the evolving policy and regulatory landscape. I’ll also examine the technical, economic, and market challenges that must be overcome to deliver a low-carbon gas system.

The Role of Gas in the UK Energy System

Current Context

  • Domestic Heating: Natural gas supplies over 80% of UK homes via the extensive gas distribution network.
  • Industry: Gas is vital for high-temperature processes in sectors like chemicals, food, and steel.
  • Electricity Generation: Gas-fired power stations (CCGTs) provide flexible, dispatchable capacity, balancing variable renewables.

The Decarbonisation Challenge

The UK’s Net Zero Strategy requires a dramatic reduction in emissions from heat, industry, and power. This means either replacing natural gas with low-carbon alternatives or capturing and storing the carbon it produces.

Hydrogen: The Next-Generation Gas?

Why Hydrogen?

Hydrogen can be produced with low or zero emissions (so-called “green” or “blue” hydrogen) and, when burned, emits only water. It offers a potential pathway to decarbonise heat, industry, and even transport.

Policy and Strategy

  • UK Hydrogen Strategy: The government’s Hydrogen Strategy sets a target of 10 GW of low-carbon hydrogen production capacity by 2030, with at least half from electrolytic (“green”) hydrogen.
  • Demonstration Projects: Major pilots like HyNet North West and East Coast Cluster are testing hydrogen production, storage, and blending into the gas grid.
  • Blending Trials: The HyDeploy project has demonstrated safe blending of up to 20% hydrogen into the existing gas network.

Technical and Market Challenges

  • Production Scale: Scaling up green hydrogen (from electrolysis) requires massive investment in renewables and electrolyser capacity.
  • Infrastructure: Repurposing the gas grid for hydrogen will require upgrades to pipes, valves, and appliances.
  • End-Use Conversion: Boilers, cookers, and industrial equipment must be adapted or replaced to use hydrogen safely.
  • Cost: Hydrogen is currently more expensive than natural gas, though costs are expected to fall with scale and innovation.

Regulatory and Market Codes

  • Uniform Network Code (UNC): Ongoing modifications are exploring how hydrogen can be accommodated within existing gas market rules (UNC Modifications).
  • Ofgem’s Role: Ofgem is supporting innovation and regulatory sandboxes to enable hydrogen pilots (Ofgem: Hydrogen Innovation).

Biomethane: Decarbonising with Molecules

What is Biomethane?

Biomethane is a renewable gas produced from the anaerobic digestion of organic matter (e.g., food waste, agricultural residues). It is chemically similar to natural gas and can be injected directly into the gas grid.

Growth and Potential

  • Current Contribution: As of 2022, over 100 biomethane plants are injecting gas into the GB grid (National Grid: Green Gas).
  • Policy Support: The Green Gas Support Scheme (GGSS) provides incentives for new biomethane production.
  • Decarbonisation Role: Biomethane can deliver immediate emissions reductions, especially in rural and off-grid areas.

Challenges

  • Feedstock Availability: Biomethane production is limited by the availability of sustainable feedstocks.
  • Cost and Scale: While competitive with other renewables in some cases, biomethane cannot fully replace natural gas at current production levels.

Carbon Capture, Utilisation, and Storage (CCUS)

For applications where gas use is hard to replace, CCUS offers a route to decarbonisation by capturing CO₂ emissions and storing them underground. The UK government is supporting CCUS clusters, often linked to blue hydrogen production (BEIS: CCUS).

The Future Gas Market: Codes, Data, and System Operation

Market Codes and Data

  • Xoserve: As the Central Data Service Provider, Xoserve is adapting its systems to accommodate new gases and track green gas certificates (Xoserve: Green Gas).
  • Gas Market Reform: The Uniform Network Code (UNC) is being updated to support hydrogen blending, biomethane injection, and new settlement arrangements.

System Operation

  • National Grid Gas: The system operator is planning for a future with multiple gases, new sources, and more dynamic flows (National Grid: Future of Gas).
  • Balancing and Settlement: As gas composition diversifies, accurate metering and settlement will be critical for market integrity.

Case Study: HyNet North West

HyNet is one of the UK’s leading hydrogen and CCUS projects, aiming to deliver low-carbon hydrogen to industry, power, and homes in the North West. The project will blend hydrogen into the gas grid, capture CO₂ for storage, and demonstrate the feasibility of large-scale decarbonisation (HyNet North West).

Barriers and Uncertainties

  • Policy and Regulatory Clarity: Long-term policy support and clear market rules are needed to unlock investment.
  • Consumer Acceptance: Public trust and willingness to switch to hydrogen or biomethane appliances will be crucial.
  • Cost Competitiveness: Achieving cost parity with natural gas remains a major hurdle.

The Road Ahead

Innovation and Pilots

Continued innovation, demonstration projects, and regulatory sandboxes will be essential to prove concepts and build confidence.

Whole-System Planning

The future of gas must be considered alongside electricity, heat, and transport, with integrated planning and investment.

Decarbonisation Pathways

  • Electrification: For many homes and businesses, switching to electric heat pumps may be the most efficient route.
  • Molecule Solutions: For hard-to-electrify sectors, hydrogen and biomethane will play a vital role.

Conclusion

The future of gas in Great Britain is at a crossroads. Hydrogen and biomethane offer promising pathways to decarbonisation, but significant technical, economic, and regulatory challenges remain. Success will require coordinated action across government, industry, and consumers, underpinned by robust market codes and data systems. The coming decade will determine whether gas can remain a core part of a net zero energy system—or whether its role will diminish as electrification accelerates.

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