Discussion on Climate Change Levy Policies: Focus on Electrolytic Hydrogen and Energy Aspects
In the realm of clean energy, the UK Government has taken a significant step forward in its commitment to promoting low-carbon hydrogen production. The government recently concluded a consultation on the optimal legislative pathway for removing Climate Change Levy (CCL) costs from electricity used in electrolytic hydrogen production [1][4].
Announced at the 2025 Spring Statement, this move aims to lower costs and stimulate growth in the hydrogen industry. The consultation, which ran until early 2025, assessed various legislative mechanisms for this removal [1][3][4]. As of now, the government is reviewing the feedback and plans to publish its response within 2025 [1][4].
The Hydrogen Energy Association (HEA), a key player in the hydrogen industry, has welcomed this commitment. Emma Guthrie, the CEO of the HEA, expressed her appreciation for the government's move, with the HEA's Green Hydrogen Working Group having long advocated for this issue [2].
However, it's important to note that the consultation did not detail the environmental benefits it aims to deliver or provide any specific financial implications or costs associated with the removal of CCL costs [1][4]. Furthermore, the consultation did not specify the legislative route it is considering, nor did it mention how the views gathered would be used or with whom they would be shared [1][4].
As the government moves towards finalizing its approach, stakeholders are encouraged to engage with the consultation to advocate for the hydrogen industry. The consultation remains open until 11:59pm on 7 May [1][4].
This legislative route is part of wider policy efforts to support hydrogen as a 'frontier' clean energy industry, including through investment plans and funding mechanisms [1][3][4]. As the UK continues to navigate its path towards a greener future, the outcome of this consultation will undoubtedly play a crucial role in shaping the hydrogen industry's growth and environmental impact.
[1] Government consultation on Climate Change Levy for electrolytic hydrogen production: https://www.gov.uk/government/consultations/climate-change-levy-for-electrolytic-hydrogen-production [2] HEA's response to the UK Government's consultation on Climate Change Levy for electrolytic hydrogen production: https://www.hydrogenenergyassociation.co.uk/news/heas-response-to-the-uk-governments-consultation-on-climate-change-levy-for-electrolytic-hydrogen-production/ [3] UK's policy efforts to support hydrogen as a clean energy industry: https://www.gov.uk/government/policies/supporting-hydrogen-as-a-clean-energy-industry [4] Spring Statement 2025: https://www.gov.uk/government/speeches/spring-statement-2025
- The UK Government's commitment to lowering costs and stimulating growth in the green hydrogen industry is part of a larger policy effort to support it as a 'frontier' clean energy industry, including through investment plans and funding mechanisms.
- A key player in the hydrogen industry, the Hydrogen Energy Association (HEA), has welcomed the government's move to remove Climate Change Levy (CCL) costs from electricity used in electrolytic hydrogen production, with the HEA's Green Hydrogen Working Group having long advocated for this issue.
- Despite the government's recent consultation not detailing the environmental benefits it aims to deliver or providing any specific financial implications or costs associated with the removal of CCL costs, it could undoubtedly play a crucial role in shaping the hydrogen industry's growth and environmental impact.
- As the hydrogen economy continues to evolve, stakeholders are encouraged to engage with the consultation to advocate for the hydrogen industry and understand the legislative route, financial implications, and environmental benefits that the government is considering.
