The UK is moving to strengthen its domestic clean energy capacity with significant investment in hydrogen technology, particularly in South Yorkshire.
The funding package is expected to create over 400 jobs and place the region at the forefront of Europe’s hydrogen production infrastructure.
At the heart of the announcement is a £40m commitment from Great British Energy, combined with a government grant worth £46.5m in principle. The funding will support the expansion plans of ITM Power, a Sheffield-based company specializing in hydrogen electrolysis systems.
UK Energy Secretary Ed Miliband commented on the investment: “This investment is a delivery of the Government’s clean energy mission to rebuild South Yorkshire’s energy security through clean homegrown electricity generation and good industrial jobs.”
“Local communities have long called for good industrial jobs for a new generation, and with these plans we answer that call and help create an economy where people don’t have to leave their hometowns just to find a decent job.
“Thanks to our government’s commitment to clean energy, a generation of young people in our industrial heartlands will have access to good-paying, secure jobs.
“This has been made possible thanks to months of dedicated collaboration between our public energy company Great British Energy, the Government and ITM Power. It’s time to make and build in Britain again, and with this Government’s clean energy mission we will do so.”
Expanding the production scale of hydrogen electrolyzers
The investment will enable ITM Power to expand its South Yorkshire facility by up to 1 gigawatt (GW), significantly increasing its manufacturing capacity for hydrogen electrolyzer units in the UK. These systems are essential for electrically splitting water to produce green hydrogen.
Hydrogen electrolyzers are widely recognized as a fundamental technology in the transition away from fossil fuels. Without it, large-scale green hydrogen production will remain impossible.
The expanded facility is expected to become the home of what authorities are calling Europe’s largest electrolyzer manufacturing cluster.
Advances in next-generation electrolyzer technology
A key element of the expansion is the deployment of ITM Power’s next-generation hydrogen electrolyser platform, known as Cronos.
The system is designed to increase efficiency while reducing production costs, addressing two key barriers to widespread hydrogen adoption.
By increasing the economics of hydrogen production, this technology has the potential to accelerate its spread in fields where decarbonization is difficult, such as heavy industry, chemicals, and long-distance transportation.
Companies in these sectors are continually exposed to fluctuations in fossil fuel prices, and hydrogen aims to alleviate that challenge.
Dennis Schulz, CEO of ITM, added: “We are grateful for the UK Government’s confidence and support. Clean power increasingly underpins energy sovereignty and resilience, which is essential for long-term economic success.”
“The UK Government’s support through a combination of investment and grants is a vital step in establishing ITM at the heart of the UK’s hydrogen economy and firmly positions us as the natural partner for projects in the UK.
“This funding will enable us to build large-scale domestic manufacturing for our next-generation Khronos platform, supporting confidence in our technology and continued growth.”
Industrial transition in South Yorkshire
The project represents a wider industrial transformation for South Yorkshire, an area historically associated with steel and heavy industry.
This transition will create roles across engineering, construction and supply chain operations, providing a pipeline of skilled jobs related to low-carbon technologies.
The local economic benefits are expected to spill over beyond the site, with demand likely to increase for suppliers and contractors across the UK.
The move also strengthens the government’s strategy to build regional clean energy hubs, rather than concentrating investment in a single region.
Strategic support for growth areas
This investment is in line with the UK Government’s wider commitment to hydrogen as a pillar of its clean energy strategy.
Officials recognize the importance of the hydrogen electrolyzer market to achieving energy independence and long-term emissions reductions.
This latest funding builds on the previously announced £500m allocation for hydrogen infrastructure, along with progress on early stage projects.
Ten green hydrogen developments from the early stages of the project have already been awarded contracts and are on track to come online.
Major investment by Great British Energy
The South Yorkshire project is Great British Energy’s largest single investment to date in its Energy Engineered in the UK initiative.
The £1 billion program aims to strengthen domestic supply chains, support UK clean energy companies and create high-value jobs.
The scale of this hydrogen electrolyser expansion signals a clear intention to establish the UK not only as a user of clean energy technology, but also as a leading manufacturer and exporter.
If successful, South Yorkshire could become the definitive center of Europe’s hydrogen economy.
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