CCS APPG Delivering a Low Carbon Gas Network The Liverpool- Manchester Hydrogen Project.

Transcription

1 CCS APPG Delivering a Low Carbon Gas Network The Liverpool- Manchester Hydrogen Project. Andy Lewis, Cadent Peter Whitton, Progressive Energy 18 th October 2017

2 Cadent Keeping the Energy Flowing Cadent - An organisation of significant size and scale Overview of UK gas distribution networks Largest distributor of gas in the UK Own and operate 4 of 8 GDNs Serving the most economically attractive regions in the UK Accounting for nearly 50% of the UK gas distribution market Regulatory responsibilities Safe and reliable gas supply to homes Emergency response Asset management and other mains replacement work High quality asset base and workforce Property, pipelines, above ground assets, control systems, fleet, technology Nearly 5,700 FTEs plus two strategic partnerships involving c. 4,500 delivery staff WE HAVE BEEN AT THE FOREFRONT OF THE EVOLUTION OF THE UK GAS INDUSTRY 20/10/2017 2

3 The Decarbonisation Challenge 3

4 Gas: flexible & convenient delivery of heat Gas provides 80% of heat at times of peak demand. Average daily electricity and gas demand 320TWh per annum to domestic customers. Over 23 million UK gas customers use the world class infrastructure. Future Role of Gas Video Cadent_Future of Gas Final Edit_MP4_1080p.mp4 20/10/2017 4

5 Reducing distribution network carbon intensity.current UK Gas Distribution Networks throughput circa 474 TWh 1 Biomethane BioSNG Hydrogen Blending Hydrogen Conversion 30 TWh potential 125 TWh potential 30 TWh potential HIGH TWh potential

6 Substitution of gas in the distribution network by low carbon hydrogen is technically feasible but challenging (H21 study) Aim has been to formulate an early stage Hydrogen Deployment Project, which.. Provides material level of CO 2 reduction Provides cost effective CO 2 abatement compared to alternatives Is deliverable in early 2020s Provides a foundation that can be extended Represents a no regrets step Focus has been on, in particular large gas users Ensuring no disruption for domestic consumers 20/10/2017 6

7 The Project: A practical, expandable, route to hydrogen deployment Today Widespread 100% H 2 Conversion In Phase 1, abates >1 MtCO 2 from industry and domestic users Delivers 5-6TWh per annum of low carbon heat As part of Project creates West Coast CCS transport and storage infrastructure Extendable to include more consumers, deeper carbon reduction. Replicable elsewhere. 20/10/2017 7

8 The Liverpool-Manchester cluster area Industrialised urban area with 5m population. >10% of total UK gas consumption >10% of UK industrial gas demand in:- Glass, oil refining, chemicals, food & drink and pulp & paper. 20/10/2017 8

9 L-M Project concept design Hydrogen produced in bulk from central plant in Ince area New hydrogen pipeline to supply industrial gas users Hydrogen blended into distribution network to supply households Pipeline spurs to gas network and vehicle refuelling hubs All new major infrastructure located outside the cities Use of existing pipeline and offshore rig infrastructure for CO 2 storage 20/10/2017 9

10 CCS infrastructure can be created as part of the Project High potential to reuse nearby oil & gas infrastructure for CCS Hamilton storage alone 130Mt CO 2 in dense phase or c23mt CO 2 as a gas Fields and pipeline and rig infrastructure, available when required. Alignment of field closure and project start up minimises costs Very cost effective CCS Low Capex Low /tco 2 even with limited annual CO 2 requiring storage

11 Defining the Project to be executed Gas supply CO 2 Storage Gas field CO2 stores CO 2 pipeline transport H2 Production & CO2 Capture Complex Hydrogen pipeline Hydrogen supply as blend to gas network Hydrogen pipeline Other industry Salt cavern hydrogen storage Potential Phase 2 hydrogen storage

12 Economic value of Project Strong contribution to economic and employment growth Protects over 100,000 energy intensive manufacturing jobs in Liverpool and Manchester City Regions, by reducing exposure to carbon-related costs from gas use Creates critical regional infrastructure for hydrogen supply to attract inward investment from industry relocating to the city Facilitates scaled production of hydrogen technologies to deliver significant numbers of advanced manufacturing jobs Creates carbon capture and storage (CCS) infrastructure attracting inward investment and skills base for CCS business growth Kick starts new business area with multi- billion pound additional GVA and new high skilled jobs 20/10/

13 Delivers multiple environmental benefits Improves air quality and reduces CO 2 Provides 5-6 TWh per annum of low carbon heat; greater than from all current UK heat network and air source heat pumps Net reduction of >1 million tonnes of CO 2 emissions, with 75% of this from energy intensive industry, which has no viable alternative means of decarbonisation Material decarbonisation of households with no disruption and at lower cost than alternatives, therefore helping to address fuel poverty A major opportunity to help improve air quality and reduce the health impacts from industrial and transport emissions 20/10/

14 The Liverpool-Manchester cluster delivers Low estimated cost of Carbon Abatement even though creates CCS & H2 infrastructure. Operating before 2025 Low Regrets Doesn t disturb gas consumers supplied by the distribution network Provides a route for material decarbonisation Bulk hydrogen produced by SMRs. Other hydrogen production encouraged (e.g. biohydrogen from waste) of industry Not conditional on adoption of full conversion of network to hydrogen Provides a platform for further decarbonisation of heat and power..subject to Government CCS policy & Price Control Policy. /te CO H2 Cluster Nuclear Offshore Wind > 500/te based on RHI & 2020 Elect Kg/MWhr Heat Pump 20/10/

15 Thank you Andy Lewis E andy.lewis@cadentgas.com Peter Whitton E peter.whitton@progressive-energy.com