In this episode, Jon and Sandra delve into decarbonising the gas sector – exploring what’s top of mind in Great Britain, as well as some of the less well-known data-related challenges. Guest Victoria Mustard shines a light on some of the issues and digs into some of the data-related challenges from her perspective as Decarbonisation Strategy Lead at gas industry body Xoserve.
Episode transcript
[00:00:04] – Jon Slowe
Welcome to Talking New Energy, a podcast from LCP Delta. I'm Jon Slowe.
[00:00:09] – Sandra Trittin
And I'm Sandra Trittin. And together we are exploring how the energy transition is unfolding across Europe through conversations with guests from the leading edge of the transition.
[00:00:21] – Jon Slowe
Hello and welcome to the episode. Today, we're going to look into some of the challenges of decarbonising gas in Great Britain, looking into some of the critical, but perhaps less glamorous gas industry data systems, as well as talking about the mood of the British gas industry when it comes to decarbonisation.
[00:00:41] – Sandra Trittin
Yes. And how we see it. It's easy to talk about the high-level changes in the energy sector for electricity or the gas system, but if we look a bit behind the scenes, there's a lot of complex data flows, processes and systems that have to undergo and move on this change of our energy future. So, it's too easy to forget about this complexity and looking forward to look into the details of that today.
[00:01:09] – Jon Slowe
Yeah, and maybe less glamorous was a bit of an unfair way to describe it, Sandra, but I guess you saw lots of this sort of detail in your work at tiko when you were coordinating large numbers of heat pumps, batteries, rolling them together to provide flexibility to the electricity system. On one hand, that sounds a simple concept, but you must have lived and breathed the complexities of that and the details of that.
[00:01:38] – Sandra Trittin
Yes. I mean, it's an example out of the electricity industry. Right. And as you were saying, it sounds like an easy concept, but the processes that had to undergo a change on different kind of levels. Right? Like on the consumer level, but then also on the technical level. On the level of the partners, either the OEM manufacturers or the utilities. Then also in the trading systems and the monetisation possibilities of flexibility. That is still a huge change. Right. And it's continuously changing also through regulation that's keeping up with these kind of changes and the technology developments. So, I assume there's quite a lot going on in the gas ecosystem as well.
[00:02:27] – Jon Slowe
Well, let's find out. So, let's say hello to our guest and dig into some of these issues. So, our guest today is Victoria Mustard, head of decarbonisation Strategy at a company called Xoserve. Hello, Vicky.
[00:02:44] – Victoria Mustard
Hi there, Jon. Hi there, Sandra.
[00:02:46] – Sandra Trittin
Hi, nice to meet you, Vicki.
[00:02:48] – Jon Slowe
My guess is most of our listeners won't know of Xoserve and probably won't know much about the sort of job Xoserve does. So, can you bring to life a bit what role Xoserve does in the gas industry in the UK and help our listeners understand a bit of those hugely important but very nitty gritty issues of data flows and processes and systems?
[00:03:15] – Victoria Mustard
Of course, I will try and bring a bit of glamour to the gas industry today. So, Xoserve is a not for profit organisation that works on behalf of the gas industry. So, what we do is we manage all of the data flows between the whole of the gas supply chain. We manage settlement, which is making sure that the gas that comes into the market is paid for, we manage the invoicing on behalf of the network companies. And a big part of my role is working with all of the companies across the gas industry to understand how we can decarbonise what we need to do. And most importantly, I would say from an Xoserve point of view, the data systems that we manage, how do we future proof them, how do we make sure that they're going to work for all types of gas that are going to be needed in the future.
[00:04:04] – Jon Slowe
So, whether that's hydrogen, biomethane, those data systems have to work in that future proofed, decarbonised world that you described. Absolutely.
[00:04:15] – Victoria Mustard
So, we are talking hydrogen, we're talking biomethane, we're talking potentially carbon capture of existing gas. Gas at the moment is a big part of what the UK uses for heat. So, understanding how the future of gas looks in supporting heat, in supporting transport and in supporting electricity production is kind of key. And one of the things that I think is a big part of what I do is helping people understand what gas actually does today, So, we know and understand what we're going to need it to do in the future or if we're going to replace it, what that replacement has got to do in the.
[00:04:57] – Jon Slowe
Sorry, Sandra gone.
[00:04:58] – Sandra Trittin
Sorry. But then, Vicky, how do you see the differences between the different types of gas? Right, you were mentioning quite a few different types of what is really the difference beside the origin or the status of the CO2 emissions, et cetera? What is the impact on your data flow and measurements?
[00:05:21] – Victoria Mustard
So, for the past, I will say 30-40 years, gas has been in existence within a domestic setting, so all of the systems have been built around a particular type of gas. So, I will try not to get too technical. From a gas point of view, I am not the technical engineer in the room here, but realistically, gas is a molecule and the size of the molecule. For gas we talk about calorific value. So, that's kind of how fat the gas is, for want of a better word, the size of the molecule that's coming through your pipes. For the last 40 years or so, that's been methane. It's been a particular type of gas. We used to have town gas, which was a mix of methane and hydrogen. We now have a methane base. So, all of the systems and the processes that manage billing, that manage your consumer bill that your metres are built around, all of the measures of gas are based on a particular calorific value range. If you introduce a different type of gas, so hydrogen, for example, the calorific value range of hydrogen is twelve. The calorific value range that we're used to is between 34 and 39.
[00:06:30] – Victoria Mustard
So, we've got quite a broad difference and what that means, realistically, to a consumer, if we were to put hydrogen into the pipes into your house, your metre would have to go three times quicker because the molecules are much smaller. So, in effect, if we did nothing to any of the systems around billing and settlement, your bills would triple. We are not intending to triple everybody's bills, just to be clear, but that's the impact of a different calorific value will have on the processes and systems. So, what we're trying to understand within our role as the central data services provider is how do we make the UK able to work with a variable calorific value? So, if I kind of quickly explain how gas works in the UK today, that might then help with the conversation. So, within the UK, we split the country into 13 local distribution zones, or LDZ. So, for example, let's take Scotland. Scotland is a local distribution zone every day, based on readings, based on our understanding of gas usage, based on weather, based on lots of different data, we know and understand what the average calorific value of the gas that's flowing through the pipes is every day.
[00:07:47] – Jon Slowe
And that doesn't change that much, Vicky, because that's nearly predominantly or is predominantly natural gas or metre, it will be.
[00:07:54] – Victoria Mustard
Within that range of 34 to 39. So, because we have that range to work within, all systems are built within that range. Now, your flow weighted average calorific value is calculated on a daily basis. It might be different depending on which part of the country you're in on whether it's cold and rainy. One of the facts I find quite interesting with the team that work here, who pull all of this data together, is if it's a cold day but sunny, people will put a jumper on. If it's a cold day and rainy, people will put the heating on. So, those kind of things we need to know and understand, not just how cold it is, but what actually what does the weather look like? Because we can determine what people's patterns of gas usage will be. That's a big part of what we do here, is understanding how people may use gas or predicting how people may use gas. What that does for the LDZ, or the local distribution zone is it sets that calorific value for the day. If within Scotland, you're introducing parts of Scotland that have a very, very different calorific value, they're going to be outside of that range.
[00:08:57] – Victoria Mustard
So, that will have a big impact on settlement and billing. So, what we've got to do is work out how we're going to manage different calorific values within those local distribution zones.
[00:09:09] – Jon Slowe
And the injection of gas at the moment, Vicki, is quite I guess gas isn't injected in that many parts of the UK, but in the future, can we imagine a future where you have lots of electrolysers around the country, you have lots of biomethane being fed in, and you have some methane as well. So, you might then have a much harder system to determine what molecules are in what parts of the country.
[00:09:39] – Victoria Mustard
Absolutely. And it could well be. So, I'll use Scotland, because I'm using Scotland as an example to anybody listening, but if we use Scotland as a local distribution zone, what we will see is you will have a number of biomethane plants. At the moment, we have Biomethane going into the grid, and biomethane has another gas called propane added to it because it has a lower calorific value. But what we do is we add propane to the biomethane to enter the grid, which brings it up to within that calorific value range. With hydrogen being so much smaller, you would have to add a huge amount of gas to bring it up to the calorific value range, which would then kind of take away the point of using something different because you're adding carbon again. So, the whole point, what we're trying to do is remove carbon from the network. That's not necessarily removing gas from the network, and I think that sometimes gets lost. Carbon and gas are completely linked. So, we have quite binary conversations around electricity as good gas is bad, carbon is bad, therefore gas creates a problem. So, it's got to go.
[00:10:48] – Victoria Mustard
And I think what we're trying to do is help people understand the context of why we need gas and why we use gas the way we do and how we need to decarbonise that gas. Getting rid of some of it makes sense. Getting rid of all of it becomes very, very problematic.
[00:11:05] – Jon Slowe
Can you see ways, or have you set out ways where you can cope with this very what I might call distributed gas system compared to maybe how I think of it, how you've described it today, which is quite a centralised gas system. If I draw a parallel with electricity, we're moving from centralised, with small numbers of power plants to decentralised with very large numbers of lots of different type of power generation. But that's easy in one way, because they're all an electron is an electron. They're not different. But for gas, it sounds much harder because you've got lots of different molecules being put into the gas network in different places. So, how on earth do you manage that?
[00:11:48] – Victoria Mustard
It's a real change of system that we need. And I would say we've probably spent the last sort of ten years thinking about, from an engineering point of view, how can we technically make this work? What the pipe can, the pipes, the joins? If you were to put a different gas into the pipes, what happens? Is it safe? That's the key thing that we've got to understand before we can put this anywhere near anybody. How safe is it for us to change gas, gas in itself isn't safe. There are things we have to do to make gas safer. Hydrogen in itself isn't safe, but there is a lot of things that we can do that will make it safer. If I go back to your kind of original point, so we get a lot of our gas from the North Sea, we get lots of gas from Europe. So, we have gas that comes into the country, into the transmission system, flows down to the distribution system and out to consumers. So, if you think of it like a motorway, your transmission system is your M roads, that's your big motorways. Your distribution network is more of your A roads.
[00:12:51] – Victoria Mustard
You then have independent gas transporters, which are kind of like little country lanes, and then you get out to A consumer, and it tends to go everything goes into the motorway, then out to the distribution zones and out to consumer. What we're going to see is kind of a reverse of that. So, rather than have large points at the country waving my arms around, but rather than have large points at different parts of the country on the beach with gas coming in, we're going to see gas created in smaller parts throughout the country and then spread out.
[00:13:24] – Jon Slowe
That sounds like the electricity system changed.
[00:13:27] – Victoria Mustard
Exactly. Yes, there are similarities and differences between the two, but there's more similarities than differences, actually.
[00:13:34] – Sandra Trittin
But this will then also mean that the data to be managed will get much more complex. Right. So, I'm only imagining, or taking the parallel again to the energy metre. To the electricity metre, where in the past it was only calculating and measuring in one way, now it has to measure in both ways. Right. So, if you have excessive solar energy, it also has to measure the flow back into the grid. So, I assume it will be the same kind of style also in the gas industry, probably not on a local consumer level, but more on a broader level. And this will also create quite some challenges, probably, or changes in your data modelling and data system.
[00:14:19] – Victoria Mustard
Yeah, and I think there are so many other factors outside of getting to net zero that also impact gas modelling. So, if I take the recent Covid-19 pandemic, we saw a real change of gas usage because people were working from home. So, you saw big offices were still being heated because they still needed to be heated, so they didn't see a massive drop in their usage. But we saw a big rise and a change in domestic usage because people were home all day. The biggest impact we've seen, actually, has probably been last winter and the impact of the price of gas. A lot more people switched their heating off last year than they ever have, because either they couldn't afford it, or they were much more aware of how expensive heating is. So, we saw people switch on for one or 2 hours a day, rather than just have their heating on. So, the way we work with gas, modelling gas is very much done on predictions. So, we have metre reads. We will take metre reads as regularly as we can. So, it's up to your supplier or you, as a consumer, will submit metre reads.
[00:15:30] – Victoria Mustard
It will depend on what type of metre you have. We've obviously, within the UK, really have really been pushing a smart metre rollout, so we can get regular reads coming through. So, within the electricity world at the moment, within the UK, there's a big push to move everybody onto half hourly metres. So, we get lots and lots of data from electricity to say, right, what happens each half an hour. It's a slightly different world in the gas world because gas doesn't move that quickly.
[00:15:57] – Jon Slowe
Yeah, you can squish it and store it in the pipes. It doesn't have to be balanced in exactly the same way.
[00:16:01] – Victoria Mustard
Exactly. It does have to be balanced, but it's balanced in a different way. So, we tend to work with daily metered or non-daily metered. The majority of metres that are out there, the majority of them there's 23 million domestic metres out in the UK at the moment. They are primarily non-daily metered. So, you bill and you bill on something called an annual quantity, which is based on either the last metre read that came in that tells you what usage has actually happened, or predicted usage. So, if you are purchasing a new house, it's very difficult to predict what your usage will be, for example. So, what we do is there are parameters that are built that say, right, if you are in this part of the world, if you have this type of house and the weather predictions we've talked about earlier, all of that will be fed in to build a picture of what a standard AQ should look like for that particular property. Then, as your metre reads come in, we'll start to understand the profile. Your profiles are then used to predict what the gas usage will be at that particular property.
[00:17:04] – Victoria Mustard
So, there's a lot of data that flows around to enable us to understand what we think gas usage is going to look like. That then feeds into people's predictions for how much gas needs to be in the pipe, how much gas do shippers need to buy to meet demand, and how do we make sure that we've got enough gas coming into the UK or we've got enough gas in storage for when we have a really cold day?
[00:17:29] – Jon Slowe
Presumably you need to also increasingly measure and predict the flow of gas from all these distributor sources into the network as well. Electrolysers, biogas, digesters, at farms, whatever.
[00:17:45] – Victoria Mustard
Absolutely.
[00:17:46] – Jon Slowe
So, what you've talked about a lot is the demand side, but the supply side will become very complex compared to how it is today as well.
[00:17:56] – Victoria Mustard
I'm not sure it's slightly more complex as it will have more people and we'll have more types of gas, more flavours of gas, for want of a better word. But the processes, in theory work the same way. It will be coming sort of distribution in rather than transmission in. So, sorry, distribution out rather than transmission in. And we also need to think about one of the things we're talking about from the UK, from a hydrogen point of view, is they want to lead in hydrogen. Know there's some really strong targets around hydrogen development for the UK. So, we also need to look at, well, what do we want to export, how do we want to export, how do we want to engage across Europe? We're not the only people that need to decarbonise. Is there a market there? How are we going to manage that? How do we manage interconnectors? All of those conversations need to be looked at across the gas industry. So, what seems quite a binary conversation of, right, we need to decarbonise, we need to get rid of gas, we need to move everybody onto electricity becomes much, much more complicated as you start to understand what gas actually does.
[00:19:01] – Victoria Mustard
And I would say the biggest sort of difference between gas and electricity at the moment is you can use electricity for heating, you can use electricity for everything. What I'm not saying by any stretch of imagination, is moving people to electricity is a bad idea. I think if you've got new properties, why would you not electrify it? It just makes sense. But renewables are fantastic, but they're intermittent. So, what happens when we've got a fortnight with no wind? The last couple of weeks within the UK have actually been sunny, but they haven't been very windy. So, we had a couple of days last week when 50% of the electricity production came from gas powered plants. So, if we don't have gas as that backup to the electricity network, what are we going to use when we haven't got any wind? What are we going to use when it's cold and dark? That's the real crunch that we've got to really understand.
[00:19:58] – Jon Slowe
I think there's certainly a lot of debate and modelling and analysis, some, that our company is doing around that challenge at the moment. And I think everyone recognises a challenge. There are lots of different ways to solve it and there are some no gross options to solving some of those challenges. The patterns that you said as well in homes, how gas will be used, I think will change as well, because definitely I have a hybrid heat pump in my home and the profile of my use of gas will be very different to my old profile when I just had a gas boiler. Now I've got a gas boiler and a heat pump. We might see thermally driven heat pumps using gas with very high efficiencies. So, yeah, I can see the data what's been the norm for the last 10, 20, 30 years. Those norms will go out the window.
[00:20:53] – Victoria Mustard
Absolutely. I think that's the biggest thing we've got to understand is we are moving into a different it sounds ridiculously, a different time, but it is going to be a different time. We have got to look at this kind of three I'll get on my soapbox for a second, but there are three big areas that we need to understand energy efficiency. So how do we make our homes more efficient? We've got the least efficient homes in Europe. However, we heat them, whether that be with gas or electricity. If we're heating them and just letting the heat escape through gaps and windows, then that's a big problem. So, energy efficiency for me is a big thing that we need to look at creating enough electricity, but the storage requirements that are going to be needed are key for electricity. And how are we going to do that without gas? I don't know. I think there needs to be some form of gas to enable us to create the electricity that we need. And then, finally, for me, the third point, I think, is people need a choice. Consumers need to know and understand what's available. And what we are seeing, certainly with hydrogen at the moment, is hydrogen is really a concept for people.
[00:21:58] – Victoria Mustard
Certainly, as a consumer, hydrogen isn't something that you're used to and there are lots of scary stories about hydrogen people don't really know and understand. Anybody doesn't know and understand how much hydrogen is going to cost in comparison to gas or electricity if you were to use it either as an industrial consumer or a domestic consumer. So, it's a very big unknown, whereas electricity is known.
[00:22:21] – Jon Slowe
And, yeah, I think in the Netherlands, the local authorities play a more prominent role in the Netherlands. But one of the things I quite like about the approach there with the network companies and the local authorities is going area by area and working with the communities and local authorities to look at those choices. Because ultimately, we don't necessarily want to have to build duplicate sets of infrastructure in the same place, but we could widen out the debate and discussion quite quickly.
[00:23:00] – Victoria Mustard
This could go off at all kinds of times.
[00:23:02] – Sandra Trittin
Yeah. I would have a bit of a question on a different perspective, because with all these changes going on, right, and with all the acceleration of the amount of data and the complexity of processes, you are now representing the full gas industry in the UK, right. How do you make sure that all of them are aligned, that you go all into the same direction, or you take the same assumptions for how the future could look like? Because I assume you will have to build up also your IT systems, your processes, et cetera. How does it work? Right? Because I found it quite interesting to have you as a company Xoserve serving all your stakeholders and aligning with all of them. But I assume it can be also sometimes quite tricky, right, to get everyone on the same plate, or probably not, I'm not sure.
[00:24:02] – Victoria Mustard
No, it can. That's probably my biggest day to day challenge, is making sure that we've understood I was going to say both sides of the argument, but understanding either side of the supply chain is probably the better way of putting it. So, there will be things that we can do from an engineering perspective within a network that make a huge amount of sense to a network, but actually add complexity and cost to the retail arm of the gas network who are then billing. So, Xoserve runs Central systems. So, we have a platform called Gemini, which manages all of the gas that comes into the UK. We run that on behalf of National Gas and that manages everything from kind of gas trades to understanding who's purchased what gas at a kind of a trading level and understanding how that moves through. You've then got a system called UK Link, which manages all of the metering data, all of the reads, all of the data that flows across various different parties. And the way it works within the UK is we have kind of a code system. So, you have the UNC, which is the network code for all of the gas parties.
[00:25:20] – Victoria Mustard
So, the people who sign up to that code are gas shippers, gas transporters and independent gas transporters. You also have something called the retail energy code. Now the Retail Energy Code manages the, as it says, kind of retail out to end consumers. So, the retail energy code is primarily suppliers and networks. So, rather than everybody have lots of individual contracts with themselves. So, we've got 40 different suppliers in the UK, rather than networks having 40 different contracts. We have one code that everybody adheres to. We are the central services provider who makes sure that all of the data items that are required within that code flow to the right people. Anything we do that we need to change or update. So, if we make any changes to those central systems, they have a knock-on impact and flow to all of the billing systems that are owned by all of the suppliers. So, we have to be very, very careful and very clear that if we're making changes to central systems, we know and understand the impacts to all of the parties, not just of the central systems, but of the systems that feed into those central systems.
[00:26:28] – Victoria Mustard
So, if I look at sort of from a consumer point of view for a moment, if we were to, I'll take a different LDZ, let's say I live in Warwickshire. So, if we were to take Warwick as a county and say, right, actually Warwick is going to become a hydrogen town, everybody is going to have hydrogen in Warwick as a consumer, I would have to change my gas boiler, I would have to change my cooker. None of the appliances that currently work on gas will work on 100% hydrogen. They're not built to spec. It's a big change to the gas regulations and laws that are around for gas. So, everybody would have to change something. So, it's a big shift for a consumer, which means it can't be done overnight, it can't be done street by street. It's going to have to be done in conjunction with all of the consumers in the area. If we were to move people to electricity, they're going to have to change the boiler and the cooker as well. So, whatever we do to move people away from carbon generating gas, there is going to be a cost somewhere and we need to understand what that cost is, not just to the consumer, but also to the systems that are involved.
[00:27:40] – Victoria Mustard
So, what we're doing as CDSP at the moment is not making those changes, but trying to design them to understand what the future scenarios could look like. And I think probably one of the frustrations we have as an industry at the moment is we're not seeing the policy decisions yet that help us to narrow down those scenarios. So, National Grid get it right, they've split into two national Grid runs, something called the Future Energy Scenarios, so they have a look and predict what different scenarios could mean and what we need to start to think about. So, what we're doing from a central data services point of view is saying, right, okay, if that scenario becomes live, this is the changes we're going to have to do if it's this. So, if we're taking everybody off gas and we're going to put them on electricity, what do we need to do to understand and help decommission that gas network? What do we need to do from a data point of view to ensure that the last person, if you've got a street of 100 houses and only one of them is on gas, you've still got to provide a pipeline, you've still got to make sure they're built correctly.
[00:28:45] – Victoria Mustard
We've got to make sure we do that.
[00:28:47] – Jon Slowe
You're coping with a very wide range of scenarios. Yes, that will need to happen pretty quickly when it comes to infrastructure and systems because definitely if we're to hit our net zero targets, then we haven't got ten- or 20-years luxury to decide what to do. That's going to have to happen in the next years and then we're going to have to crack on with it. So, I can see you must be desperate for more steer from the UK government in terms of which direction policy is going to go.
[00:29:24] – Victoria Mustard
And I think we are rapidly reaching this stage where there are some decisions that have to be made. I know that sounds ridiculous, all decisions have to be made, but it's no longer we've. Provided a lot of data. So, we do work with the Department of Energy regularly having conversations, providing data to them to kind of enable them to understand the implications of any of those decisions. I don't envy them. These are not easy decisions and they're not binary decisions. That's the problem. It's yes or no. So, there's a decision that's due this year to see whether we can start to blend hydrogen into the existing gas network. So, what that would mean if we were to blend let me kind of put it in context. So, we've talked just then about if you're moving to 100% hydrogen, you have to replace all your cookers, boilers, et cetera. The current gas regulations allow for a blend of hydrogen up to 20% and all appliances are tested with a blend of up to 23%. So, that's a blend of hydrogen and existing methane. If we were to blend 20% of hydrogen into the existing gap network today, we would remove 7% of our carbon emissions.
[00:30:33] – Victoria Mustard
Now 7% doesn't sound a lot, but actually from a carbon emissions point of view, that's a huge amount and it's a start. And if we are to blend hydrogen, we have a use for hydrogen. So, at the moment we don't have a hydrogen market, start a market, but then we'll enable 100% and your systems.
[00:30:52] – Jon Slowe
Need to be ready for yes for that.
[00:30:55] – Victoria Mustard
So, we've got systems ready for blend, right? We have systems ready for blend to a lower percentage. We talked about earlier about the flow weighted average calorific value calculation. We can blend to a certain point without impacting that flow weighted average calorific value that we can start, I would say as soon as a decision has been made, but that's not quite right. So, let's say there's a positive decision. We then need to make some changes to the regulations. We then need to upgrade code to allow all of that to happen. So, if we were to get a decision in 2023, I would say we would start blending probably 2025 and we've got to have the hydrogen to blend. Just a little point there, but we've got to have the hydrogen to blend in there. But we are ready, the engineering is ready, the systems have been tested, the safety aspect has been tested. We know and understand what we need to do. What my next step is, sorry, doesn't.
[00:31:48] – Jon Slowe
Have too much implication on the data flows in the systems.
[00:31:51] – Victoria Mustard
No implications at the moment, so long as we blend within a certain percentage. If we want to blend everywhere at a higher percentage, we've got to look as central systems provider as to how do we then change how we manage billing. That's where this whole understanding how we manage a variable CV is kind of a given really. We know that hydrogen is going to support industry in some way. We are fairly confident it's going to have to support electricity production in some way. What we don't know is if hydrogen is going to support domestic heat or not. That's a big conversation. That's a whole conversation in itself. But we do know that we are going to have different flavours of gas coming into the network. So, we, as central systems have got to manage variable CVS. That's my next big project.
[00:32:36] – Jon Slowe
Well, I think now we better bring out the talking new energy crystal ball. I loved your summary at the end, Vicky, about where hydrogen is going to be used, where there's certainty, quite a lot of consensus and uncertainty. But now I want to set the Talking New Energy Crystal Ball to 2035 and ask you for your view. And it can be an exercise view or your own personal view as to what exerciser will be doing differently or how exerciser will be working. You can frame it as you wish.
[00:33:12] – Victoria Mustard
My crystal ball in 2035, so I will go with the Vicky view of the world, if that's okay. So, I think there's I kind of have a pessimistic view of the world and an optimistic view of the world. So, my pessimistic view of the world by 2035. 2035 is when we need, we have committed a legal target to decarbonise the electricity industry. So, that means there should be zero carbon emissions by 2035, which isn't that far away. So, my pessimistic view is that it's cold, it's dark and we've got a few blackouts. My optimistic view is that we've had some policy decisions that enable hydrogen to be introduced to the gas network, that we have changed a network code to ensure that a hydrogen market can develop, and that we are blending hydrogen and we have a number of hydrogen fired power stations who are helping generate electricity. Okay, that would be my Vicky view of the world. It's a lot to do in the next ten years to enable that to happen and it's not going to happen unless we get some policy decisions pretty quickly.
[00:34:23] – Jon Slowe
Well, let's see what's coming up, not only in the UK, but in other countries, because definitely we maybe have our gas has a very big role in the UK, but a big role in many other countries as well.
[00:34:36] – Victoria Mustard
And I think hydrogen, I'm pretty sure it's the Netherlands that have just started. They have, I think it's twelve houses that are now running on 100% hydrogen. We will have some of the projects we support for 100% hydrogen. So, there's H 100 and Fife in Scotland, which will be running by then, which will have run for a while actually by then, which is around 300 households running on 100% hydrogen. So, we'll have a much better view of what hydrogen can or can't do to support domestic heating by that point.
[00:35:10] – Jon Slowe
Well, thanks very much, Vicky. Thanks for sharing your time. Uncovering some of the details of the gas system in the UK and the role of Xoserve and your views on how gas might be used in the future. Sandra, what stood out to you in the discussion today?
[00:35:29] – Sandra Trittin
I think for me there's one major point, is that from an engineering point, I think we are far more advanced, or what I hear from Vicky than I would have expected personally, but that there is still a lot going on in how to bring all of the solutions really into the markets right, and to alive. And I think it's always a question coming back to investment security, into regulation policies, et cetera, being brought up in the right manner so that the industry can move quicker because it doesn't seem to be a huge issue besides some challenges right, to start and move away from the traditional kind of gas into newer ways. And you mentioned quite a few ones, Vicky, that can be used. Right. And this I find really interesting also for people to listen today and now it's again, we have to do it right, we have to make it happen, we have to move forward because the clock is ticking. How about you, Jon? I mean, what would you take from your side?
[00:36:50] – Jon Slowe
At one level, I still see a lot of uncertainty around the future role of gas, and we have discussions on the podcast with people that think gas will have zero role to people that think gas will have a big role and everything in between, I'm sure it will have a role. I think there's some very hard to decarbonise parts of the energy system where it's really hard not to have gas. And the more you electrify in a way, the more you need the swings and the storage that the gas can provide. What encouraged me actually, is how much work has been done. There's still a lot to do by companies like Xoserve in thinking through and planning how to manage these challenges. But what disappoints me a bit is that the big decisions I think that we need from governments are often kicked down the road. They're politically really hard decisions, so I can understand why, but we're in a rush and we need some certainty for companies like Xoserve and the work Vicky and her colleagues do to be able to crack on and implement things. So, I think that's my main takeaway, that there's a lot of complexity, a lot of work being done, but there needs to be some of the big decisions need to be made quite soon.
[00:38:18] – Sandra Trittin
Fully agree.
[00:38:19] – Jon Slowe
Okay, well, we'll leave it there for today. Thanks everyone, for listening. We hope that you enjoyed the episode, learned some new things about calorific value perhaps, and sizes of different molecules, and understand a bit more about the role of gas and the future of gas as we decarbonise our energy system. Thanks for listening and look forward to welcoming you back next week. Goodbye.
[00:38:44] – Sandra Trittin
Thanks for tuning in. We are excited to bring you captivating conversations from the leading edge of Europe’s Energy transition. If you've got suggestions for topics or guests for future episodes, please let us know.
[00:38:56] – Jon Slowe
And if you're enjoying the podcast, then please do rate it and share it with colleagues. For show notes, transcripts and more, please visit www.lcpdelta.com.
Talking New Energy
AN LCP DELTA PODCAST
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