There is very little legislation that specifically relates to hydrogen. Instead, hydrogen projects must navigate the existing legislative landscape that applies to gasses more generally. Hydrogen is captured under the definition of “gas” in the Gas Act 1986 (the “Gas Act”) and is therefore regulated as part of the gas network.
The UK gas market is regulated by the Gas and Electricity Markets authority, operating through the Office of Gas and Electricity Markets (“Ofgem”). Anyone engaging in gas supply, gas shipping or gas transportation, or who participates in the operation of gas interconnectors, or provides smart metering in respect of gas must have a licence to do so under the Gas Act. The licences include measures relating to the safe operation of the gas network and provisions relating to price controls. An entity wishing to transport hydrogen (or carry out another activity regulated by the Gas Act) through gas pipelines may therefore require a licence and as part of this must demonstrate a credible plan to commence licensed activities and permit a risk assessment to be carried out by Ofgem as part of the process for obtaining the licence.
Further, a gas licensee much also comply with various industry codes, such as:
- The Uniform Network Code – sets out the common rules governing the gas transportation arrangements between licenced gas transporters and shippers, as required under their licence. Every licensed gas transporter must have its own network code, incorporating the Uniform Network Code, and governing the terms on which it will transport gas. It includes a Transportation Principal Document, which sets out the gas transportation arrangements between gas shippers and transporters and an Offtake Arrangements Document which sets out arrangements between different transporters.
- Independent Gas Transporter Uniform Network Code – sets out the common rules applying to independent gas transporters. It aims to harmonise the network code arrangements of Independent Gas Transporters, who operate extensions to the gas network such as those serving new housing developments.
- Supply Point Administration Agreement – this is a multi-party agreement to which all gas transporters and suppliers are required to comply with. It facilitates supply point administration, being the change of gas supplier.
- Retail Energy Code – this enables end consumers to switch energy suppliers.
Injection into the gas grid – blending hydrogen into the existing gas networks
Pursuant to the Gas Safety (Management) Regulations 1996, the concentration of hydrogen that can be injected onto the UK gas network is 0.1%. As mentioned above, this is being tested to increase the hydrogen blend to up to 20%. If successful, the regulations will need to be amended to allow for this higher blend.
Real Estate and Consenting
Major hydrogen projects are likely to be nationally significant infrastructure projects which require a development consent order under the Planning Act 2008. For smaller projects (or pipelines) such consents may be instead regulated through the Town and Country Planning Act 1990.
In addition to ensuring the relevant consents are obtained, land rights need to be secured the same as for other infrastructure. As such access rights would be needed from production and storage facilities to ensure they are fit for the purpose of large-scale industrial transportation which may be through private contracts or under the compulsory acquisition powers that may be available. In the case of re-purposing existing infrastructure, variations to existing rights are likely to be needed to reflect the necessary technological upgrades and/or regulatory issues.
In relation to storage of hydrogen, an Environmental Impact Assessment may be required if hydrogen is to be stored on site or if there are pipelines carrying hydrogen pursuant to the Town and Country Planning (Environmental Impact Assessment) Regulations 2017.
Health and Safety
Hydrogen, like other gasses is heavily regulated from a health and safety perspective. The Health and Safety Executive (“HSE”) requires compliance with the following regulations:
- Gas Safety (Management) Regulations 1996 – concerns the flow of gas through the network. All gas transporters must prepare and submit a safety case to HSE. This identifies the hazards and risks, explains how they are controlled, and describes the system in place to ensure that controls are applied. The gas transporter will be audited to ensure compliance with their safety case
- Pipeline Safety Regulations (1996) – concerns pipeline integrity. These regulations set out requirements in respect of pipeline design, construction, installation, operation, maintenance and decommissioning. For example, pipelines should be equipped with emergency shut down valves and its design should take account of the need for maintenance access.
- Storage of Hydrogen is regulated by The Planning (Hazardous Substances) Regulations 2015 and/or the Control of Major Accident Hazards Regulations 2015 (“COMAH”), depending on the quantities involved. COMAH sets a high bar of requiring operators to take all measures necessary to prevent a major accident and limit consequences for human health and the environment. The operator must have in place various strategies, including safety plans, emergency plans and a Major Accident Prevention Policy.
- Under the Hazardous Substances Regulations, consent is required to store two or more tonnes of hydrogen, and a further consent is required where storing five of more tonnes of hydrogen.
- The Dangerous Substances and Explosive Atmosphere Regulations 2002 sets out requirements for the use of equipment and protective systems in potentially hazardous environments, including those where hydrogen is produced or stored.
Transport of hydrogen by road
The European Agreement concerning the International Carriage of Dangerous Goods by Road (“ADR”) regulates the transport of hydrogen, which is classified as a dangerous good under Annex 5 of the ADR. Hydrogen transport is excluded through ten tunnels in the UK, based on its ADR classification.
Drivers transporting hydrogen must be appropriately trained, and vehicles must meet specifications required for hazardous cargoes.
The Pressure Equipment (Safety) Regulations apply to the design and manufacture of tanks used to transport hydrogen.