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Network Innovation Allowance
GD - Future of gas, GD - Environment and low carbon, GT - Future of gas and GT - Environment and low carbon
Gas Distribution Networks
HyNet is a well-advanced, integrated Hydrogen and Carbon Capture Utilisation and Storage (CCUS) project located in the North West of the UK. It has been developed in order to materially reduce regional CO2 emissions from ‘hard to reach’ sectors of the economy, including industry, heat and transport. HyNet will provide low carbon hydrogen for fuel switching of industrial users and dispatchable power generators, together with injection into the local transmission system (LTS) for blending with NG at key points. Transport fuelling locations can also be served. The initial network will be developed incrementally over the coming decade to serve users with varying demand profiles and connect with hydrogen storage to provide balancing and system resilience.
Cadent intends to participate in HyNet by joining the consortium seeking partial funding for engineering design and consenting of the hydrogen distribution assets from the IDC Deployment fund competition organised by UKRI. If successful, Cadent will complete Front End Engineering Design (FEED) and Consenting of Phase 2 of the Hydrogen Distribution network. Cadent is seeking to prepare the Basis of Design (BoD) for the Hydrogen Distribution Network Phase 2 before the IDC Deployment funding is awarded, so that work can commence on the FEED as soon as the main funding is available.
The project will enable a FEED BoD to be developed, which will be further updated during the FEED itself. The FEED BoD will have:
- Sufficient detail to define the scope of work, Scope of Requirements (SoR) and design data to establish the design basis for the FEED project stage
- Once the BoD has been finalised and accepted at the end of the project, there after it will be subject to the project Management of Change Procedure (MoC)
- The BoD is to be followed and developed further if required by the project team who undertake the FEED. The BoD will be used to establish the scope and detailed design which is to be carried out during the FEED
- Refresh the feasibility study hydrogen demand forecasts which underpins the sizing and key connection locations of the planned network.
- Create a draft ‘hydrogen UNC’ and connections methodology. It will be necessary to outline the expected connections approach to customers whilst detailing connection and consumption profiles
- The BoD will also need to have an interface with other parts of the HyNet project such as the hydrogen production and storage. These interfaces will be managed to ensure that the BoD works alongside these interfaces.
- This BoD will also look at Policy Resilience. Including the project being categorised as an NSIP and any other relevant policy decisions that need to made at this stage of the project.
The potential benefits of this project remain the same as the previous phase. The HyDeploy project suggests that if a 20% H2 blend is rolled out throughout the UK this will enable 29TWh of low carbon heat to be injected onto the GB network and this has the potential to save the consumer £8Bn compared to other methods/routes to decarbonisation such as heat pumps. On a wider scale, the 2050 energy scenario report by KPMG, produced on behalf of the Network Licensees as part of (NIA_SGN_00064) Energy Map and Plan (2016) suggest the conversion of the gas network to hydrogen compared to electrification could save the consumer £7,000 to £9,500 each or £152bn to £214bn for GB.
The work will also guide the GD2 business plans for Cadent and other network licensees. This will reduce costs for all customers during GD2.
We would also expect the potential CO2 and air quality benefits from solving the problem to be significant. Such environmental and health benefits can be converted to financial benefits (using ‘damage’ costs).