Policy & Regulations

Liquid Hydrogen Storage presents with unique regulatory and policy challenges. The company reported that the biggest hurdle towards the manufacturing and commercialisation of liquid hydrogen storage tanks in the UK is Brexit. The UK exiting the European Union gave rise to the implementation of UKCA standards, significantly risking the supply chain, since overseas suppliers do not manufacture based on the UKCA standards. Currently, article 40 of the Brexit regulations surrounding pressure equipment allows manufacturers to deviate from UKCA standards. However, there are talks underway to remove article 40, and would make it mandatory from liquid hydrogen tanks to be manufactured to UKCA standards. This would require the valves to be UKCA rated, and cryogenic temperate rated valves are already in low supply in the UK. Hence, the company predicts that the UK manufacturers of liquid hydrogen tanks will continue to produce tanks based on EU regulations but would not be able to commercialise the product in the UK. Hence, the implementation and utilisation of liquid hydrogen in the UK would be hampered, creating a significant risk for UK-based SMEs. The company recommends that the government change current regulations and implement strategies that allow for multiple globally recognised certifications to be interchangeably used, effectively derisking the supply chain of critical components that are simply not manufactured in the UK. Adding to the change in policy, the company recommends that the government reevaluate the tariff, VAT, and indirect taxes on overseas value chain, since commercialisation of liquid hydrogen would only be feasible if considerable profit is generated. Otherwise, UK-based liquid hydrogen SMEs would be forced to move to lucrative business endeavours, which would significantly damage the UK hydrogen industry. Speaking to the availability of funding, the company reported having been successful for Innovate UK and ATI funding bids but would prefer to have the process streamlined for SMEs. Additionally, they recommended that there should be regulatory guidelines towards the commercialisation of IP generated as a result of academic research collaborations.

Proton Exchange Membrane Fuel Cell (PEMFC) systems require extensive certification for implementation, especially for aerospace and automotive applications. The company reported that the stringent certification and functional safety requirements of PEMFC systems for automotive applications has proved to be quite expensive and resource demanding. The aviation certification requirements for PEMFC systems are still emerging, inducing uncertainty within the industry. However, the FAA and CAA are investing significant efforts for a smooth regulatory transition for the aerospace industry in regard to PEMFC systems. For UAV products, the company is working towards beyond-line-of-sight compliance with the relevant regulatory bodies to aid commercialisation for specific applications, such as pipeline inspection. In terms of incentivisation for adoption of PEMFC systems, the company recommended that the government provide revenue and CAPEX support to ensure a sustainable hydrogen supply, while simultaneously providing cost support to end-users to switch from fossil fuels to hydrogen. This would remove the uncertainty from both the supplier and off-takers point of view. Similarly, the government should focus on the rapid development of hydrogen distribution and storage networks on a national scale, complimenting their targets of 10 GW of low-carbon hydrogen production targets by 2030. Although initiatives via road mapping are underway by the aerospace and aviation industry (APC and ATI), these efforts need to be optimally coordinated between different sectors, lead by the government. This is because PEMFCs offer opportunities for manufacturers and suppliers across different industries, and a cross-cutting theme is necessary for rapid adoption of PEMFC technologies. In terms of funding streams, the company reported that they were successful in funding bids from the APC, ATI, and the AMRD programmes. However, they expressed concern regarding the availability of funding for UAV and material handling PEMFC applications, while automotive and aerospace applications have significant dedicated funding streams. Lastly, the company reported that there is an urgent skills-based need requirement for the hydrogen industry in the UK, especially with respect to the handling and implementation of hydrogen technologies. Insufficient skills support will result in the UK lagging other major economies in the commercialisation of hydrogen technologies.

Solid Oxide Fuel Cell (SOFC) and Solid Oxide Electrolyser Cell (SOEC) technologies are currently not commercialised in the UK. The company suggested that the government needs create more pull from the market, providing incentivisation to the industry to enable commercialisation of solid oxide technology in the UK. Furthermore, it would be beneficial to increase funding streams in critical component development, such as compressors and balance of plant integration applications, while also increasing funding for fundamental material research for solid oxide technology. The company suggests that the government take the same approach towards solid oxide technology implementation as the EV mandate, which would significantly improve product deployment. In terms of specific incentivisation streams, the company believes that electrolysers, for green hydrogen production, in the UK will only become viable if the government subsidises low-carbon electricity.