Written Statement

Thursday 16th January 2025 Written Statements

Thursday 16 January 2025

Gas Shipper Obligation Consultation

Thursday 16th January 2025 Written Statements

[The Minister of State, Department for Energy Security and Net Zero (Sarah Jones)]

Today the Department for Energy Security and Net Zero is publishing a consultation on the design of a gas shipper obligation. The Government intend for the gas shipper obligation to be the long-term funding mechanism for hydrogen production business model payments to initial hydrogen production projects and related costs. Decisions on funding for future hydrogen production business model projects will consider consumer affordability, value for money and fairness.

We are working to rapidly increase the roll-out of home-grown, clean energy. Publication of this consultation demonstrates this Government’s commitment to developing a thriving and world-leading UK hydrogen sector. Low-carbon hydrogen will play an important role in supporting the delivery of our clean energy superpower and growth missions, as a key enabler of a low-carbon and renewables-based energy system. It can make our energy system more flexible, resilient, and independent, and could lead to billions of pounds of savings by 2050. The Government are committed to leaving no community behind by investing in a new era for the clean energy industry and supporting good, skilled jobs as the sector matures. Low-carbon hydrogen provides opportunities for UK companies and workers, reigniting our industrial heartlands by investing in the industries of the future.

I will deposit a copy of “Funding mechanism for the Hydrogen Production Business Model” in the Libraries of both Houses.

[HCWS367]