At least 5,000 jobs will be created by a £900 million project to create a new green source of gas to power local industry and heat homes in North West England, according to Cadent, the UK’s biggest gas distribution network.
Cadent has published details of the potential economic windfall set for the North West through its HyNet project.
The report explains how the North West will “trailblaze” a switch from a dependency on methane-rich natural gas to using more of low-carbon hydrogen.
The first stages of the 30-year plan centre on a new hydrogen production facility planned for Cheshire, making gas for distribution locally and into Merseyside and Greater Manchester.
Central to HyNet is a promise to reduce carbon emissions by more than one million tonnes every year, or the equivalent of taking 600,000 cars off the road.
Cadent Gas Ltd is majority owned by a consortium of global investors composed of Macquarie Infrastructure and Real Assets (14.5%), CIC Capital (10.5%), Allianz Capital Partners (10.2%), Hermes Investment Management (8.5%), The Qatar Investment Authority, (8.5%), Amber/INPP (4.4%) and Dalmore Capital (4.4%) — while National Grid plc still owns 39%.
“A huge bonus of the project is repurposing gas fields in Liverpool Bay and elsewhere off the North West coast, which are due to be decommissioned soon,” said Cadent.
“Cadent proposes using these sites instead to store the carbon captured during the process of extracting hydrogen from natural gas.”
Cadent’s report said more than 5,000 jobs would be created between now and 2025, with thousands more to follow as more plants and pipelines come online.
“Up-and-running by the mid-2020s, it would be a UK-first large-scale use of hydrogen in this way, helping to solve Britain’s headache of how to decarbonise heat,” said Cadent.
“At the same time, it could open the door for the use of hydrogen as a ‘clean’ fuel for buses, lorries and trains.”
Simon Fairman, Director of Safety and Network Strategy at Cadent, said: “This is unquestionably one of the most exciting energy projects for the North West in years.
“We chose the region because it is already home to 10% of the UK’s biggest industrial users of gas, as well as it having an ideal site on the doorstep to store the carbon that’s produced in making hydrogen.
“HyNet will create and secure thousands of jobs – up to 80% locally – through the design, installation, construction and operation of the new hydrogen and carbon storage infrastructure needed.
“We’re talking huge numbers, but we’re also talking about a huge impact in solving a problem facing us all in the UK, how to decarbonise heat.
“We’ll reduce the amount of carbon that enters the atmosphere by one million tonnes every year.
“What’s amazing is that domestic users will simply use gas tomorrow the way they use it today, through the same appliances and pipework they have in their homes now.
“This is Cadent showing leadership through innovation.
“But we need to work together and clear some hurdles yet if we are to make this clean growth for the UK happen.
“We need a favourable Government policy mechanism for CCUS [carbon capture, usage and storage].
“We will also work closely with Government and our regulator Ofgem to discuss the right funding mechanism.
“And we also need to prove to the Health and Safety Executive that hydrogen is safe to use at these volumes in homes, which we’re confident of doing through a project that’s already under way at Keele’s university campus.”
Mayor of Greater Manchester Andy Burnham said: “This has the potential to be a fantastic project, supporting Greater Manchester’s ambitions to be a UK and European leader in tackling climate change by reducing our carbon emissions.
“Taking a whole energy system approach means we will need to collaborate across the North West.
“At our inaugural Green Summit in March this year, we said investment in green technologies and policies would bring huge economic benefits – the report being launched today is a great example: thousands of jobs and a big step towards achieving a green future.”
Liverpool City Region Metro Mayor Steve Rotheram said: “The building blocks are rapidly falling into place to enable the Liverpool City Region and the North West to lead the way in finding cleaner, greener sources of energy.
“Using hydrogen to power industry and heat homes in phase one is very exciting, but this HyNet project also sets out a longer-term roadmap towards supplying hydrogen to fuel our trains and buses.
“It’s visionary, timely and just what we need.”