Net Zero Hydrogen Fund – Strand 2: Capital expenditure (CAPEX)

Strand 2: Capital Expenditure (CAPEX) is 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.

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 of 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.

If your project requires development expenditure or engineering design, strand 1 may be more appropriate: click here for details of strand 1 funding (DEVEX, FEED, or post-FEED expenditure). If you are unsure which is more appropriate, watch the KTN briefing from 26th April or contact Steffan Eldred.

Your project must:

• have a total grant request of between £200,000 and £30 million
• start by 1 January 2023
• end by 31 March 2025
• last between 6 and 27 months
• carry out all of its project work in the UK
• intend to exploit the results from or in the UK
• meet the Draft Low Carbon Hydrogen Standard
• be using core technology that has been tested in a commercial environment, Technology Readiness Level (TRL) 7 or more

To lead a project or work alone your organisation must be a UK registered business of any size. Any UK registered organisation can collaborate.

A business can lead on up to 2 applications, which must be materially different, and can be included as a collaborator in a further 2 applications. An academic institution or a research and technology organisation (RTO), charity, not for profit or public sector organisation can collaborate on any number of applications.

This competition will provide capital expenditure (CAPEX) to support low carbon projects to take a Final Investment Decision (FID) and begin deployment in the early 2020s. Your project must not require support from a hydrogen business model (these projects are covered in Strands 3 and 4 of the NZHF). This competition supports multiple hydrogen production pathways.

Your project must address low carbon hydrogen production opportunities and must focus on construction of new low carbon hydrogen production facilities.

We expect credible projects to utilise one of the following hydrogen production types:

• electrolysis
• methane reforming
• gasification

Click here to watch the recording of Innovate UK KTN’s briefing event from Tuesday 26th April.

If you want help to find a project partner, contact Steffan Eldred, our Hydrogen expert.