The aim of the Net Zero Hydrogen Fund (NZHF) is to provide capital expenditure (CAPEX) and development expenditure (DEVEX). This will support the commercial deployment of new low carbon hydrogen production projects during the 2020s. This is to ensure the UK has a diverse and secure decarbonised energy system fit for meeting our ambition of up to 10GW low carbon hydrogen production by 2030, and commitment to reach net zero by 2050. The NZHF will deliver up to £240m via four strands as follows: Strand 1 : Development Expenditure (DEVEX) support for front end engineering design (FEED) studies and post-FEED studies, to grow the future pipeline of hydrogen projects in the UK. Strand 2: Capital Expenditure (CAPEX) for projects that do not require a hydrogen specific business model. These are low carbon hydrogen projects that can deploy on the basis of capital expenditure support and are able to start construction rapidly.(This strand) Strand 3: CAPEX for projects that require a hydrogen business model (HBM) and sit outside of the Phase 2 cluster sequencing process. Strand 4: CAPEX for carbon capture usage and storage (CCUS) enabled projects that require a hydrogen specific business model and are part of the Phase 2 cluster sequencing process. This competition relates to Strand 2 only. Your proposal for strand 2 must demonstrate how you will develop a credible project that will contribute to the at-scale production of low carbon hydrogen by 2025. Funded projects must support the delivery towards the 10GW production target by 2030 set out in the Energy Security Strategy UK Hydrogen Strategy. Hydrogen production projects will be able to apply for co-funding through Strand 2 if they require CAPEX support to take a Final Investment Decision (FID) and begin deployment in the early 2020s. Competition closes 6 July 2022.
