Hydrogen demand in Scotland: a mapping of industrial and transport applications

The aim of the study was to address the chicken and egg dilemma present in the budding hydrogen market. The reports will help both the public and private sector to identify potential offtakers of hydrogen and inform the development of Scotland’s hydrogen hubs. They also provide techno-economic information about hydrogen as a decarbonisation option for these potential customers’ processes and energy needs, and evaluates barriers and opportunities for hydrogen in each sector.

The two studies were carried out by different consultants and comprised both a literature review of prior reports, new desk research and engagement with industry stakeholders. Each used distinct methodologies which are detailed within the reports to create estimates of potential hydrogen demand for multiple sectors of interest in Industry and Transport.

Hydrogen was found to be a viable decarbonisation pathway across many industrial and transport sectors present in Scotland to varying degrees. Alternative decarbonisation options were acknowledged as more viable options for some sectors, which are therefore unlikely to represent a large demand for hydrogen unless their plans change significantly. The research reaffirmed the potential for significant offtake from sectors such as oil and gas refining, chemicals and pharmaceuticals, shipping, distilleries and aviation. New research pointed to interesting opportunities in the mobile generator market that provides power to large events and construction sites, as well as in construction and agriculture. Overall, 26TWh of hydrogen could by consumed by industry and transport domestically by 2045, though market and policy decisions could significantly alter these estimates.

The report identifies short and long term drivers to stimulate the Scottish hydrogen market. These include supporting and interconnecting Hydrogen Hubs, the identification of decentralised production sites where there is curtailed renewable energy, the delivery of both electrolytic and CCUS-enabled hydrogen, helping the most compatible industries to switch to hydrogen, and investing in large scale infrastructure for storage and distribution.