Hydrogen Allocation Rounds
The Hydrogen Allocation Rounds allocate revenue support through the Hydrogen Production Business Model (HPBM) to hydrogen production facilities across the UK.
The Hydrogen Allocation Rounds (HARs) are a government funding mechanism to support low carbon hydrogen production across the UK.
Low carbon hydrogen is essential to achieve the government鈥檚 Clean Energy Superpower and Growth Missions. It will be a crucial enabler of a low carbon and renewables-based energy system and will help to deliver new clean energy industries which can support good jobs in our industrial heartlands and coastal communities.
Hydrogen presents significant growth and economic opportunities across the UK, by enhancing our energy security, providing flexible, cleaner energy for our power system and helping to decarbonise vital UK industries. We have the strong domestic expertise and favourable geology, geography and infrastructure to develop a thriving low carbon hydrogen sector in the UK.鈥�
The HARs allocate Hydrogen Production Business Model (HPBM) revenue support funding to successful projects over a 15-year period, to overcome the operating cost gap between low carbon hydrogen and high carbon counterfactual fuels. Successful projects are awarded and sign a Low Carbon Hydrogen Agreement (LCHA).听
In the Autumn Budget 2024, we confirmed support for 11 green hydrogen projects from聽Hydrogen Allocation Round 1 (HAR1), which comprised 拢90 million in capital grant support through the Net Zero Hydrogen Fund and over 拢2 billion of revenue support through the HPBM. We expect these projects to become operational between 2025 and the end of 2026.聽
Delivery partners
The Low Carbon Contracts Company (LCCC) is a private company owned by DESNZ. The LCCC is the counterparty to the contracts awarded in Hydrogen Allocation Rounds. Its primary role will be to:
- issue the contracts
- manage them during the construction and delivery phases
- make HPBM payments
Hydrogen Allocation Round 3 (HAR3)
Hydrogen Allocation Round 2 (HAR2)
Since HAR2 applications closed in Spring 2024, we have conducted a comprehensive assessment process to produce a shortlist of projects that are invited to the next stage of the HAR2 process.
The shortlist contains 27 electrolytic hydrogen production projects across England, Scotland, and Wales.
Hydrogen Allocation Round 1 (HAR1)
Evaluation of Allocation Rounds
To ensure learning and accountability, government evaluates its policies.
We completed a Process Evaluation of the HAR1 stages up to the notification of shortlisting. The evaluation captures feedback about the design and delivery of HAR1 and helped inform the design of HAR2.
We will add future process, impact and value for money evaluations here.
Cluster Sequencing Process
Eligible CCS-enabled low carbon hydrogen projects may apply for revenue support via the Cluster Sequencing Process.
Updates to this page
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Hydrogen Allocation Round 2 shortlisted projects published.
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First published.