Emerging Energy Technologies Fund - Hydrogen Innovation Scheme: form and guidance

Overview

Objectives

The Hydrogen Innovation Scheme is a £10 million capital funding stream of the Emerging Energy Technologies Fund, to be delivered over 4 years from 2022/23 – 2025/26.

EETF HIS is designed to support the development and demonstration of renewable hydrogen technologies and products needed to support the Scottish Government’s ambition of 5GW installed hydrogen production capacity by 2030.

The objectives of the scheme are:

• to support innovation in hydrogen production, storage and distribution technology to reduce the cost of hydrogen produced in Scotland
• to enable Scottish companies not currently active in the hydrogen sector to transition or diversify their operations to help anchor the hydrogen supply chain in Scotland
• to encourage collaboration between the private sector and academia
• to attract additional investment in Scottish hydrogen innovation activity
• to support Scottish companies to partner internationally to drive innovation and build and export Scottish capability/expertise
• to support the development and use of Scotland’s world-class test and demonstration facilities

The EETF Hydrogen Innovation Scheme is split into two streams. Stream 1 and Stream 2:

• Stream 1 will provide funding for feasibility studies or technical demonstration of hydrogen production, distribution or storage solutions at Technology Readiness Levels (TRL) 3 to 7
• Stream 2 will provide support for the development of test and demonstration facilities and equipment in Scotland

Stream 1 – feasibility and demonstration

Stream 1 is supports the development of novel hydrogen production, storage and distribution solutions (TRL 3-7). It will provide funding for projects to undertake feasibility studies or to develop, build and trial their hydrogen solution.

Projects must be targeted at developing new products/solutions, improving versions or qualities of existing products/solutions, or discovering or developing new or more efficient processes of production. They will need to be able to demonstrate the core purpose to be 'acquiring new knowledge' per the definition in HM Treasury guidance. You can find the consolidated budgeting guidance here for capital projects. Support is available to interpret guidance for defining a feasibility study or trial project, please email: EETF@gov.scot.

To be eligible for funding, projects must fall within one of the three themes below:

1. Renewable Hydrogen production

Projects that support the low-cost, efficient and durable production of renewable hydrogen.

For example:

• optimisation of production technologies
• high temperature processes
• use of sea water or poor quality water
• desalination efficiency
• new materials

2. Hydrogen storage and distribution

Projects that support efficient, low-cost short, medium and long term hydrogen storage and distribution both within Scotland and for export e.g. novel hydrogen storage and distribution solutions, component innovation to reduce distribution costs, optimisation of hydrogen carrier options for export.

3. Integration

Projects that support the efficient integration of hydrogen into our energy system.

For example:

• novel solutions to improve the efficiency and optimisation of hydrogen production on the grid and as a balancing mechanism to renewable energy
• to optimise capture and use of waste heat, hydrogen separation technology, improved controls, leak detection, safety systems

Projects developing innovative solutions for end-use applications are not eligible for this first funding call.

Stream 2 – test and demonstration facilities and equipment

Stream 2 supports the growth of Scotland’s hydrogen innovation ecosystem. It will provide capital funding to support the development of test and demonstration centres in Scotland that will act as centres for future hydrogen innovation.

This funding could cover the purchase of equipment or construction of facilities.

Projects must be able to demonstrate their plans to meet delivery and staff costs without Scottish Government support e.g. via funds committed by project partners. The capital contribution requested from the Scottish Government should take account of subsidy control (formerly state aid) parameters depending on the type of project and type of project partner. The proposed subsidy control rate put forward by bidders will then be subject to discussion and agreement with the Scottish Government.

Applicants to stream 2 should demonstrate the wider benefit of their proposal to Scotland’s industry and academic community.

Additional resources

A webinar on the HIS took place on 5 July 2022. Please see further information below.

• access a recording of the webinar
• view presentations from the event
• read the news release with further details