Hydrogen Supply Chains

Claire Young Excerpts

Tuesday 9th September 2025 Westminster Hall

[Claire Young (Thornbury and Yate) (LD)]

It is an honour to serve under your chairship, Mr Betts. I thank the hon. Member for Rushcliffe (James Naish) for securing the debate, and his able substitute, the hon. Member for Worcester (Tom Collins), for opening it.

With good access to offshore wind resources, the UK is ideally placed to scale up green hydrogen production, and I can see the benefits of that locally. At IAAPs—the Institute for Advanced Automotive Propulsion Systems—which is just outside my constituency, work is being done on green hydrogen production and its uses in the aviation, marine and heavy transport sectors, and in June 2023 I attended the Western Gateway hydrogen conference.

The wider south-west and Wales could offer abundant renewable energy—the Celtic sea has huge offshore wind potential—which can anchor green hydrogen production alongside connected industries that can use the hydrogen. For example, in aviation, progress is being made by companies such as Airbus and GKN Aerospace, which employ hundreds of my constituents, and ZeroAvia, as highlighted by my hon. Friends the Members for Bath (Wera Hobhouse) and for South Cotswolds (Dr Savage).

I recognise the importance of the green hydrogen industry for growth and the high-value jobs that it brings for local people, as expanded on so well by, among others, the hon. Members for Middlesbrough South and East Cleveland (Luke Myer) and for Strangford (Jim Shannon). It brings huge decarbonisation benefits for things such as buses, as highlighted by the hon. and learned Member for North Antrim (Jim Allister), and adjacent benefits such as the production of fertiliser, as highlighted by my hon. Friend the Member for Caithness, Sutherland and Easter Ross (Jamie Stone).

However, we are not realising the potential for the UK to be a world leader for a number of reasons, as set out in the September 2024 report by Hydrogen UK on the hydrogen supply chain. The level of capital funding that the UK currently provides the hydrogen supply chain does not match the level in competitor regions. It has been slow to respond to a rapidly developing market and has not made the investment in infrastructure or skills needed to take advantage. As the Hydrogen Innovation Initiative has highlighted, the UK must act now.

[Wera Hobhouse]

Since there is a bit of a south-west mafia here, it might be worth mentioning those at the south-west hydrogen hub and to urge the Government to engage with them, because they are doing great work on the provision of hydrogen across the region and the sectors.

--- Later in debate ---

[Claire Young]

I thank my hon. Friend for her intervention, and I am grateful for the support of the wider south-west mafia.

Hydrogen UK has reported that unlocking storage infrastructure investment is urgently needed as the sector could require 3.4 TWh of large-scale hydrogen storage by 2030, which could increase to 9.8 TWh by 2035. Projects in the UK are currently smaller and lack visibility so project developers and off-takers stick with their international suppliers, and there is the ever-present problem for all small businesses of navigating the so-called valley of death as they grow.

The Liberal Democrats want to see investment in research and development of new green energy sources, which will be vital for developing new green hydrogen technologies and breaking our dependence on fossil fuels. We support a transition to clean, home-grown renewable energy sources to reinstate the UK as a world leader in renewable energy, to improve energy security and to bring down consumer energy bills: the importance of long-term storage to achieve that was highlighted in the introduction. Disappointingly, the previous Conservative Government failed to act with anything close to the speed or ambition that this challenge demands, and Putin’s barbaric and illegal invasion of Ukraine has exposed the risks of relying on countries that may seek to exploit dependence on fossil fuels and use it to their advantage.

Britan can lead the way on hydrogen innovation with our history of expertise, pioneering businesses and research institutions, but the Government have been criticised for failing to invest comparable amounts of capital funding in hydrogen to the level that other regions do. Hydrogen UK has called on the Government to support business-led innovation programmes, which would anchor supply chain growth into the UK and support collaboration with private business investment into key areas of the hydrogen supply chain. It has also called for a nationwide supply chain programme to leverage private investment into UK supply chains and key supply chain technologies, and to support both existing companies to pivot and new companies to enter the hydrogen market.

We want the Government to commit to winding down the oil and gas industry, but that must come hand in hand with a detailed plan for the redeployment of skills and local jobs. The economic impact assessment done by Hydrogen UK estimates that hydrogen can deliver significant economic benefits, including 30,000 jobs annually and £7 billion of gross value added by 2030. Trade unions in the industry are united in calling for substantial funding to build domestic renewable manufacturing but, disappointingly, the Chancellor did not commit to that in her most recent spending review. We urge the Government to invest in upskilling the existing workforce in adjacent sectors such as oil and gas, and to secure the investment that is needed to realise the job-creating potential of the green just transition.

Another key mechanism would be to link the UK emissions trading scheme with the EU’s, implementing a UK carbon border adjustment mechanism, making the business case stronger for low-carbon hydrogen in domestic supply chains, and adopt green procurement policies that support clean supply chain development. Finally, my right hon. Friend the Member for Kingston and Surbiton (Ed Davey) has repeatedly called for a sovereign green wealth fund to reinvest wind-generated revenues into green industries including hydrogen, promoting decarbonisation and manufacturing job creation across the UK.

To conclude, we urge the Government to put in place a comprehensive plan to support low-carbon technology for industries and homes, in particular to make the UK a world leader in hydrogen.

[Mr Clive Betts (in the Chair)]

I have had a note from the hon. Member for Strangford (Jim Shannon) explaining why he had to leave the debate. I fully accept his explanation and apology, and thank him for giving it to me.