Energy Shift: Imposition of Energy Profits Tax and Innovative Plans for Green Hydrogen Production
The UK Infrastructure Bank (UKIB) has announced a significant investment of up to £100 million on a match-funding basis, unlocking between £100 million and £300 million of private capital for next-generation infrastructure projects. This move is part of a broader government initiative to enable public buildings to cut their use of expensive fossil fuels by switching to electrified heating solutions, with an additional £553 million in funding already allocated for upgrading public buildings with affordable, low-carbon heating and energy efficiency measures.
Meanwhile, the European Commission has drafted new rules for the production of green hydrogen and its legal classification as being from fully renewable sources. The EU’s draft proposals aim to provide investment certainty and accelerate scaling up clean hydrogen production across Europe. The EU’s framework defines a renewable hydrogen category based on inputs from renewable electricity (wind, solar, hydro, etc.) and introduces a comprehensive methodology to measure greenhouse gas emissions throughout the hydrogen lifecycle. For hydrogen to be considered low carbon, it must achieve at least 70% greenhouse gas emission savings compared to unabated fossil fuels.
In a separate development, the UK Infrastructure Bank and Octopus Investments have launched a sustainable infrastructure fund to support new green projects across the UK. The new fund is expected to reduce 20,000 hours of scanning work down to just 15 minutes and save up to 90% on costs, as demonstrated by a recent partnership between UK Power Networks (UKPN) and DeepMind. Through this collaboration, digital versions of electricity cable maps have been produced, scanning and remastering over 180,000km of electricity wires. These digital maps will be made available to the rest of the industry for free, benefiting organizations such as battery operators, local authorities, and energy aggregators.
The digital maps will help ensure the safety of those carrying out excavation works by clearly showing where power lines are located. Moreover, they will allow UKPN to provide better and faster services to customers, including those installing electric vehicle charging stations.
It's important to note that the savings from these projects will be reinvested into the electricity network to increase reliability and enable the UK's transition to a low-carbon economy. The proposed rules for green hydrogen production in the EU require a temporal and geographical correlation between the renewable energy used and the production of green hydrogen. The EU Commission will publish its final proposals and submit the draft text to the European Parliament following a public consultation period, which ended on June 17.
In conclusion, the UK and EU are making substantial strides in the transition to a low-carbon economy, with investments in sustainable infrastructure, digital technologies, and green hydrogen production. These initiatives are expected to provide long-term benefits, including increased energy efficiency, reduced emissions, and improved safety for workers and consumers alike.
[1] Source: European Commission's Delegated Acts on Renewable Hydrogen (RFNBOs)
- The UK Infrastructure Bank's investment in next-generation infrastructure projects also extends to environmental-science initiatives, aiming to promote low-carbon solutions.
- The European Commission's emphasis on green hydrogen production aligns with the UK's push in the financial sector, as sustainable infrastructure funds seek to deploy cleaner energy solutions in the industry.
- The benefits of technological advancements, such as the digital maps produced by the UK Power Networks and DeepMind, reach beyond energy efficiency and cost savings; they also contribute to safety improvements and the proliferation of clean energy infrastructure like electric vehicle charging stations.
