The logistical solution to a reliable industry hydrogen supply

In May routeone learned that supply and storage remains one of the biggest hurdles for the adoption of hydrogen across UK coach and bus fleets.

But for every challenge there is a solution, and innovators with expertise and capital to make it happen.

Tim Harper, a former engineer at the European Space Agency (ESA), is one of the pioneers searching for solutions to the problems of hydrogen deployment. While working for a supercar manufacturer in 2019, he began to explore hydrogen’s use in engines, having used the element as a propellant in his work with ESA. Supply became an obvious problem early on.

The opportunity therefore was not in manufacturing engines that could run on hydrogen, but in building the infrastructure to support that transition when it eventually happened. He formed Element 2 in 2021 with the aim of building the first national network of hydrogen refuelling stations across the UK and Ireland by 2027.

“We’re not inventing things. Everything we buy has got to be off the shelf, fully certified, safety tested, insurable. That’s how we put together the company,” Tim explains. “When we founded the company, people were getting interested in hydrogen. A lot of technology had already been invented and the whole landscape would move extremely quickly. We wanted to be technology agnostic, and just concentrate on the best way to get hydrogen from where it’s made into the tanks of vehicles. We’ll use whatever is the best and most efficient technology to do that.”

The solution

Element 2’s approach is based on classic logistics and supporting infrastructure. The company currently operates a fleet of four hydrogen transporters with a further eight on order. By mid-2025, it aims to run up to 15 such vehicles. To avoid assets being disused, the business is scaled just ahead of demand.

The two constituent parts of the operation include the hydrogen transporter, which doubles as storage, and the dispenser. Equipment is currently skid mounted, allowing deployment across the country, but a move to more permanent installations is expected over the next four years. That is driven by demand, where operators and logistics providers that utilise hydrogen are based. Three sites are being established: At Coneygarth service station near Leeming Bar on the A1, Teesside airport, and Golden Fleece service station on the M6, south of Carlisle.

Planning restrictions have been cited as a barrier for hydrogen deployments at operator depots, but Element 2 has seen its own planning applications expedited by the use of existing fuelling sites. Despite that, it is involved in the push for easier deployment and more appropriate regulation.

“Hydrogen is regulated as a chemical and taxed as a chemical rather than a fuel,” Tim explains. “You often find legislation takes a while to catch up with new developments. We are pushing hard to try and get hydrogen regulated in the right way. A lot of the pressure there is coming from fleet operators and trade associations with the ear of government.”

Having a better regulated supply of hydrogen and clear policy is crucial. A lack of organised approach in the UK compared to Europe discourages investment in hydrogen supply and generation. “We know what the long-term vision is in, say, Germany,” Tim adds. “In the UK there isn’t really anything. So where will investment go? The UK policy is all sticks, no carrots. That is something that needs to change.”

COMAH regulations mean only two tonnes of hydrogen can be stored on site, so the approach by Element 2 is to provide two containers each with one tonne of hydrogen on site, and switch containers over as needed. “That allows us to keep a constant supply while avoiding falling foul of regulations. But as the use of hydrogen becomes more widespread, those regulations will hopefully change.”

The source

The upfront costs of electrolysers and hydrogen storage, and the relatively small volume of hydrogen that is dispensed, diminishes the business case for on-site hydrogen production if it is being used exclusively in transport applications. Instead, Element 2 recognised the need to source hydrogen byproduct from industrial applications, or green hydrogen.

With a source in place, Element 2 bought its first hydrogen refueller and by May 2021 had secured its first contract with CaetanoBus for a trial in Inverness. Since then, thousands of refuelling operations have been completed. In addition to Scotland, the company supports another bus operation in Northern Ireland.

“Everything seems easy, but it’s not,” Tim reflects. “Having that experience in getting hydrogen to where it is needed, and from containers into vehicles, all kinds of vehicles, coaches, buses and HGVs, road sweepers and airport tugs, gives us a vast amount of experience in everything around hydrogen logistics. Of course, we have to do it safely, reliably and complying with insurance requirements as well.”

While Element 2 sources largely from industrial by-products, it recognises the demand long-term is for green hydrogen. It is seeing more renewable projects coming online this year and is working with 45 different projects for green hydrogen, giving confidence in a plentiful supply. Those projects are scattered across the UK which will, it is hoped, keep down transport costs. Tim expects the supply to be 100% green within the next two years.

If availability of the fuel is one measure of its attractiveness, another will be its price. “There are a variety of prices depending on how the hydrogen is made, where it’s made, and the competition there is for those molecules,” Tim says. “But we’re looking at diesel parity within a couple of years. If the fuel duty escalator is reintroduced, it might be quicker.”

The future

By 2027 Element 2 aims to have around 25-30 stations up and running, with three to four containers at each station. That should give coverage for “most” of the country.

“The good thing about dealing with commercial transport is that operators know where the equipment is going and when,” Tim says. “This means we can plan better. As the market develops, we’ll be putting out more stations across the country, and our model is very much like the early days of petrol stations, putting in infrastructure as it is needed. The way to lose money is to build kit ahead of demand.”

Collaboration is also underway with National Gas Transmission on deblending hydrogen from the high-pressure transmission network. According to Tim, 20% of the backbone of the national gas network can safely accommodate hydrogen. A molecular sieve recovers it. If successful, within four or five years, hydrogen could be transported by pipeline, reducing transport costs further. Element 2 plans to tap into that supply, increasing efficiency and reducing truck mileage.

Tim further hopes the creation of the Element 2 network will help drive development of more hydrogen vehicles. For every traditional station with on-site production and storage, Element 2 can build 10.

“Somebody has to do this, to put in the infrastructure in place and allow people to make the right decisions for the future of the planet,” he says. “We’re doing our tiny bit.”