It’s a sustainable fuel that can power transport, heavy industry and even potentially heat our homes. Scotland is positioning itself as a green hydrogen powerhouse to keep Germany’s manufacturing industry steaming ahead in the transition to net zero and could add up to £25 billion a year to the Scottish economy in 20 years’ time.

Green hydrogen is produced by using electrolysis, powered by renewable energy such as offshore wind, to split water molecules into oxygen and hydrogen.

The Herald: How green hydrogen is produced (Picture:SGN)How green hydrogen is produced (Picture:SGN) (Image: SGN)

Hydrogen could be crucial  as nations around the world look for alternative fuels to oil and gas and Scotland is placing itself right at the heart of the revolution.

The Scottish Government has made no secret of scaling up the country’s wind power capacity.

Ministers have set an ambition to boost Scotland’s current offshore wind capacity of around 2.6GW to up to 11GW by 2030, alongside an ambition to more than double the country's onshore capacity to 20GW by 2030.

The Scotwind leasing round could see up to 27.6GW of capacity created for renewables over the next decade.

Read more: Explained: What is green hydrogen and where can it be used?

Demand will soar for clean electricity over the coming decades as more cars and heating systems are plugged in, but the Scottish Government’s strategy includes ramping up capacity by much more than we need – and that could help create lots of excess green hydrogen.

The Scottish Government has set an ambition of producing up to 5GW of hydrogen by 2030, with this ramped up to 25GW by 2045. This means that by 2030, more than 450,000 tonnes of hydrogen could be produced annually in Scotland for both domestic and international use.

The Herald: German ambassador to the UK Miguel Berger meets Angus Robertson and Humza Yousaf at Bute HouseGerman ambassador to the UK Miguel Berger meets Angus Robertson and Humza Yousaf at Bute House (Image: Scottish Government)

Forecasting by the Scottish Government has indicated the hydrogen economy has “potential GVA (Gross Value Added) impacts of between £5 billion and £25 billion a year by 2045”.

To put that in context, in 2020, support for oil and gas generated £1.7 billion GVA for the Scottish economy, having stood at £3 billion in 2012.

Read more: SNP's just transition chief blows hole in independence economic case

The Scottish Government is also investing in hydrogen at home – with £100 million pledged for innovation up to 2026. Some of the latest projects to receive funding include a hydrogen innovation hub at Glasgow Airport for storage and distribution, a scheme using waste heat from wind turbines on the Isle of Lewis to create the fuel and a study into treating water from the River Clyde to produce hydrogen cheaply.

The blueprint to clean up heavy polluting industries at Grangemouth also centres around switching fuel to hydrogen.

Read more: Feature: What Scotland can learn from Dutch North Sea innovators

Some climate campaigners remain sceptical about hydrogen as a key part of net zero – there are various grades including grey and blue hydrogen that still require fossil fuels – splitting natural gas into hydrogen and carbon. The green variety currently costs more to produce.

The UK Government, while supportive of the hydrogen industry, has ruled out regulation to allow fossil fuel boilers to use hydrogen as an alternative fuel for heating our homes.

But the Scottish Government is ramping up its diplomatic strategy to essentially sell the nation’s “immense potential” in fuelling mainland Europe with the clean fuel of the future.

Hydrogen replaces oil and gas as economic case for independence

Long gone are the days when the SNP were putting its faith in ‘Scotland’s oil’ as a key selling point of the economic case for independence, with the climate-wrecking fossil fuel now seemingly destined to history.

But the renewed case for independence, drawn up by the Scottish Government, points to green hydrogen as an industry that could kickstart the economy of a future independent Scotland.

The economic blueprint for future separation brands renewable hydrogen as potentially “Scotland’s greatest industrial opportunity since oil and gas” amid claims it could create up to 300,000 jobs.

Germany seems to be an obvious fit to export green hydrogen, but Scotland is not the only interested party.

Earlier this year, Norwegian state-owned fossil fuel giant, Equinor, better-known on these shores as the firm behind the controversial Rosebank oil field development, is planning a hydrogen pipeline to Germany.

Under the plan, up to 10GW of hydrogen, although not the green variety, will be pumped to Germany by 2038.

Spain also has proposals for pumping green hydrogen to central Europe.

Germany cannot produce enough hydrogen itself – a lack of a windy coastline and a heavily regulated onshore wind sector don’t help, but it simply needs a whopping amount of the stuff.

Hydrogen demand for Germany could reach as much as 130TWh by 2030, while up to 70% will need to be imported from abroad.

Scottish Government analysis from 2020 claims that Scotland “will be able to produce up to 94 TWh of green hydrogen for export by 2045”.

Read more:  Investigation: Rishi Sunak's 'false' claim North Sea oil and gas cleaner than imports

The “Scot2Ger” study, completed in early 2022, highlighted Scotland’s capability to supply renewable hydrogen to Germany as early as 2025.

Germany is turning its back rapidly on Russian oil and gas, following the invasion of Ukraine, while the Germany government appears as sceptical about nuclear power as the SNP Government at Holyrood.

Geography plays a key role in Scotland’s ambitions – with its location between Norway, Ireland and Iceland making the country an ideal candidate to become a hub for northern European production of green hydrogen.

The underseas infrastructure that has powered the North Sea oil and gas sector could potentially be repurposed for hydrogen while exporting the fuel is likely to be done as ammonia – seen as a safe and more cost-efficient method of exporting hydrogen at large volumes.

In June, a report commissioned by the Scottish Crown Estate highlighted a potential hydrogen trunk pipeline between Scotland and Germany with feed-in pipelines from key locations in Shetland, Orkney, Cromarty Firth and St Fergus in Aberdeenshire.

SNP External Affairs Secretary, Angus Robertson, told The Herald on Sunday that “Scotland has an abundance of renewable energy resources which can be used to produce green hydrogen, including enough offshore wind power to supply electricity to every home in the UK for almost two years”.

He said: “This is expected to make Scotland a net hydrogen exporter, while supporting a just transition to net zero.

“Scotland’s close proximity to major North Sea markets leaves us well placed to meet German demand.

The Herald: SNP External Affairs Secretary Angus RobertsonSNP External Affairs Secretary Angus Robertson (Image: PA)

“We are already supporting a number of industry-led projects which explore and demonstrate the delivery of hydrogen and hydrogen products from Scottish ports into Northern Europe.”

Mr Robertson, a fluent German speaker, is playing a key role in forging a hydrogen partnership with Germany and other European countries – holding several meetings with key German and European officials and politicians.

The External Affairs Secretary visited Berlin last December and met with Belgian diplomats in Edinburgh in June to discuss hydrogen while Energy Secretary Neil Gray has met with Icelandic officials and Energy Minister Gillian Martin used last month’s Arctic Circle Assembly in Reykjavik to boast about Scotland’s hydrogen potential for northern Europe.

After a meeting at Bute House last month between German ambassador to the UK, Miguel Berger, First Minister Humza Yousaf and Mr Robertson, the German ambassador highlighted “our co-operation on renewable energy, the potential for hydrogen, for offshore wind”.

Mr Robertson said: “Energy Secretary Neil Gray visited Berlin in September to promote Scotland’s hydrogen industry and attended the signing of a joint declaration of intent on hydrogen between the UK and Germany.

“The First Minister has also hosted the German ambassador to the UK Miguel Berger. Scotland has received federal education and research ministry hydrogen commissioner Till Mansmann and German hydrogen envoy Juergen Friedrich to explore our immense potential in this area, and discuss how we can move forward.

“Trade Minister Richard Lochhead will meet political leaders and industrialists in Germany this week during a mission to strengthen vital international partnerships and showcase Scottish technology.”

Union warns SNP ministers to focus on hydrogen use in Scotland

But union leaders have warned that ministers should be talking about the potential of hydrogen to transform Scotland today instead of “pie in the sky” export markets fort he future.

Claire Greer, GMB Scotland’s organiser in energy, said: “We have heard far too many visionary speeches from ministers about our green future and far too little about the practical steps that will take us there.

“It seems delusional to talk about some future market for hydrogen abroad while, in the here and now, it’s potential to transform the transition to green energy in Scotland is ignored.

“Before ministers talk about exporting hydrogen to Germany or sending pies to the sky, they need to properly understand and exploit its domestic potential.”

The union is urging Scottish Government to slow its drive for homes to have heat pumps while urgently scrutinising the viability of supplying hydrogen to homes using the existing network, repurposed by gas engineers.

The GMB claims the rush to electric heat pumps risks thousands of jobs in oil and gas, off and onshore, undermines the country’s energy security and risks huge bills for households forced to install new technology untested in Scottish homes.

The UK’s 280,000km gas grid supports more than 24 million homes and, GMB Scotland says, using that supply system for hydrogen could benefit consumers while giving new impetus to the transition to net zero.

Ms Greer said: “The cost of heat pumps will remain a huge barrier for most home owners meanwhile decommissioning our gas network is going to cost an estimated £100 billion.

“Those pipes could be supplying green gas to homes in Scotland but we’re not even discussing the possibility.

Read more: SNP's energy strategy dealt blow after report warns hydrogen for heating 'not efficient'

“Even without any conversion work, domestic gas supplies could include 20% hydrogen.

“Meanwhile, ministers fly abroad to talk about some booming international market in hydrogen in the never-never.

“They might want to ask why Germany or wherever might want to buy our hydrogen and ask why we are not using it ourselves?”

Climate fears over reliance on hydrogen

Concerns also remain about the climate impact of relying on hydrogen.

Friends of the Earth Scotland’s climate campaigner, Alex Lee, said: “Due to its high cost and low efficiency, hydrogen is unsuitable for most methods of transportation and heating so it is really hard to imagine where the massive hydrogen market of which the Scottish Government is dreaming will come from.

Read more: Concerns over SNP ministers' 'greenwashing' hydrogen lobbing meetings

“Ministers must stop being distracted by hydrogen and instead deliver credible plans across energy and transport that focus on real and much-needed solutions that will also improve lives like insulating homes, installing heat pumps and public transport run in the public interest.”

They added: “In spite of the overwhelming scientific evidence that fossil fuels must be urgently phased out, the oil industry is desperate to push hydrogen made from fossil fuels in an attempt to extend its own lifetime. A big push for green hydrogen also risks letting these fossil fuel hydrogen plans sneak in the back door.”

“Any rush to embrace green hydrogen also risks swallowing up vast amounts of vital renewable energy. This could divert it away from being used where it can be most effective in directly replacing fossil fuels in how we power our lives.”