Today's short debate is to be presented by Janet Finch-Saunders.

If I can ask Members to leave the Chamber quietly, especially those of you who are currently surrounding Janet Finch-Saunders. Any Members wishing to leave the Chamber, do so quietly and quickly, and then Janet Finch-Saunders can start and introduce her debate. 

Diolch, Llywydd. Tonight's debate is 'Developing the hydro energy sector in Wales', and I have agreed to give a minute each to Samuel Kurtz MS, James Evans MS, Huw Irranca-Davies MS, Rhun ap Iorwerth MS and Sam Rowlands MS. So, a popular debate. 

The Deputy Presiding Officer (David Rees) took the Chair.

Reaching net-zero greenhouse gas emissions by 2050 is a very significant challenge. It requires urgent action across the economy. The International Energy Agency has said

'an unprecedented clean technology push to 2030' is required. Hydrogen, we all know, has a very key role to play. As the House of Commons Science and Technology Committee have noted,

'it has unique features as a clean burning fuel that can be stored on long timescales with scalable production through several low-carbon means. This enables hydrogen to play a role not only in decarbonising our energy consumption, but also in providing more resilience for our energy system, and increasing the UK’s energy security.'

There is no doubt that low-carbon hydrogen could be a versatile replacement for high-carbon fuels used today and that Wales is well-placed to be a hydrogen powerhouse. There are so many exciting projects across our country. The south Wales industrial cluster is looking at the production and transport of hydrogen and the capture and use of carbon dioxide on a large scale. RWE is developing a green hydrogen project on their existing Pembroke power station site. It's a brilliant scheme. For example, green hydrogen produced by using electricity from renewables will be used in local industry and as a fuel for future hydrogen-powered HGVs. ERM Dolphyn and Source Energy have announced plans to develop gigawatt-scale green hydrogen floating wind sites in the Celtic sea. HyNet is going to reduce the amount of carbon dioxide emitted from across the region by a quarter through locking away the carbon dioxide emitted by heavy industry and providing locally produced, low-carbon hydrogen to power industry and transport and heat homes and businesses. A Deeside-based hydrogen fuel pioneer has now secured nearly £250,000 of UK Government funding to perfect carbon capture technology that will help lower the environmental impact of its waste-to-hydrogen plants, and we cannot forget that plans for a hydrogen hub on Anglesey have been approved, paving the way for the first development of its kind in Wales. In fact, the UK Government has developed a strategy that sets out how the Conservative Government will drive progress in the 2020s to deliver our 5 GW production ambition by 2030.

However, it has to be said, Members, Llywydd and Minister, that both Scotland and Wales are less ambitious. Scotland’s hydrogen action plan only provides actions to be taken over the next five years, and here in Wales we are reliant on a hydrogen pathway that is only informing activity that will take place in the short term, to 2025. No surprise, then, that the consultation responses published just last June included findings such as multiple respondents noting that they felt that the pathway only covered short-term goals and should be more ambitious. They felt that a long-term strategy is required to enable the roll-out of the hydrogen economy and build a long-term market for low-carbon projects. And several respondents suggested that the pathway even lacked detail and ambition in some areas in which hydrogen is expected to play a key role in the energy system in the long term: decarbonisation of industry, for heating buildings, and as an energy storage solution allowing increased use of intermittent renewables.

Even your own Government states, Minister, in the summary of consultation responses, and I quote,

'the Pathway was to define a set of short-term objectives, focusing on actions and projects that can be implemented in the early part of the 2020s. The document is not (and was not intended to be) a comprehensive strategy for hydrogen in Wales, rather it sought to define a set of no regrets actions to position Wales to take advantage of the range of benefits that increased uptake of hydrogen can bring.'

So, where is that comprehensive longer-term strategy for hydrogen innovation in Wales? Alongside incorporating all the fantastic activities that are already happening, I would specifically be interested to see the strategy include sections that set ambitions for hydrogen in communities, in transport and in planning.

Communities in Scotland and in England are experiencing change. In some instances, only limited changes are needed to gas pipes and homes for hydrogen to be used for heating, hot water and cooking. In fact, using hydrogen in the gas network isn't a totally new concept. Hydrogen used to run through the nation's pipes as part of town gas before the 1960s, and now in England, at Whitby in Ellesmere Port, properties in the confirmed hydrogen village will be provided with a free hydrogen-ready gas boiler upgrade, and hydrogen will be supplied from 2025. Similarly, in Scotland, this year, 300 homes in Buckhaven and Methil will be powered by green hydrogen. But, Minister, I'm a Welsh parliamentary Member. What about our communities here in Wales? We should all here aspire to have a hydrogen neighbourhood trial delivered, and as soon as possible, followed by a large hydrogen village trial and a town pilot by the end of this decade. 

In terms of transport, I have referred already to HGVs and I must acknowledge that attracting vehicle integrators to Wales and developing fuel-cell trains is part of your pathway's own recommended actions. However, what is our ambition for private vehicles? As my colleague, James Evans MS, will know better than most, Riversimple is pioneering the next generation of zero-emission vehicles. They use hydrogen, not batteries, and they emit nothing but water. Green Tomato Cars operates a fleet of 50 hydrogen vehicles in London, and DRIVR runs a fleet of 100 hydrogen taxis in Copenhagen. So, I would be delighted to see incentives for hydrogen taxi fleets here in Wales. 

We need to be looking at removing barriers to hydrogen cars for private use. In fact, there has even been good news recently, as UK Government funding is now going towards a Toyota project to create a hydrogen fuel cell powered version of its world-famous Hilux pick-up. However, already on the British market are Toyota Mirai and Hyundai Nexo, so we could be supporting our residents to invest in those green modes of transport. In 2021, Norwegian ferry operator, Norled, took delivery of the world's first liquid hydrogen powered ferry, MF Hydra. It has capacity for 300 passengers and 80 cars. Norway has been doing groundbreaking work to demonstrate the viability of hydrogen as a fuel for passenger ships. Wouldn't it be amazing if we had an ambition to work with the Irish Government and the private sector to possibly see hydrogen-powered ships sailing between our ports? 

Finally, there is a need to ensure that our planning authorities are properly supported to provide quick approval of hydrogen schemes. For example, I'm aware that responses to your consultation included concerns about the planning regime here in Wales. Some had noted that long-term planning timescales cause major delays to the commissioning of larger scale projects, adding an unnecessary additional risk. Detail as to whether you've explored possible solutions to concerns about planning would be great to hear tonight. At the end of the day, we should remove all possible barriers to hydrogen, especially green hydrogen, from developing to play an even more important role in Wales. At heart, you could do more to help by creating a proper hydrogen strategy for Wales. I do hope in your response, Minister, that you will be very positive on this debate. Other contributions from other Members tonight will prove to you just how important it is that we include hydrogen big style in our drive for renewable, carbon-zero targets. Diolch.

I'm grateful to the Member for Aberconwy, Janet Finch-Saunders, for giving me a minute of her time. I'm pleased that she mentioned RWE in my constituency of Carmarthen West and South Pembrokeshire and their hydrogen project. I'd be delighted to welcome you down to Carmarthen West and South Pembrokeshire, Janet, and I extend that invitation to the climate change Minister as well, to see the pioneering project at RWE. And there was positivity from the Welsh Government last year in terms of the use of transition hydrogen, in terms of blue hydrogen and green hydrogen—the necessity of both of those as we look to reach net zero—and the increased use of hydrogen in HGV vehicles, as Janet mentioned, taxi fleets et cetera. So, I'd extend the invitation to you both to come down to RWE, in the best constituency in all of Wales, and I know RWE will be delighted to show you what they have on offer, what they're looking to do in the scope of hydrogen production. Diolch, Dirprwy Lywydd.

I'd like to thank Janet Finch-Saunders for bringing this important debate to the Senedd. The hydrogen sector is hugely important to my constituency, as Janet has mentioned. A few years ago, a company called Riversimple moved to Llandrindod Wells to build a prototype hydrogen car there on the site, aptly called the Rasa. Even His Majesty the King took a spin in a hydrogen car, and he was very, very impressed. Developing the hydrogen sector in Wales is crucial to becoming greener; we need more hydrogen infrastructure right across Wales. I know my colleague Peter Fox, in Monmouthshire Council, used Riversimple to deploy some vehicles there, but it's the only place we have the hydrogen infrastructure in Wales, and, if we are to develop this further, we need to make sure there's more investment into that, so we can expand hydrogen right across Wales. Because batteries are not the future—hydrogen technology is. It's greener and cleaner and a lot more ethical than lithium mining in other parts of the world.

Thank you very much, Janet, for giving me a minute to contribute in a very interesting debate. There are a couple of early-stage proposals within the Bridgend area, actually, for hydrogen projects, green hydrogen projects. And indeed, hydrogen might well have a role to play in our transitioning to a greener economy. But I want to make two points. The first is that we have to make sure that hydrogen does not displace our investment in renewables—that's very important, to make clear that point. But the main point I want to make is this: if we are to develop hydrogen proposals, particularly those that are close to or within communities, then we need to bring those communities along, explain the technology very well, explain the safety aspects very well. Because if there's misinformation, or lack of engagement, then those communities will be understandably worried about what this means for them. So, my appeal within this debate, to anybody who's proposing developing hydrogen projects in or near to communities, is to engage properly with those communities who will be affected to explain the technology and what it may mean for them. Diolch yn fawr iawn.

Thank you very much to Janet Finch-Saunders for presenting this debate. I'm pleased that we are keeping hydrogen on the agenda. It's almost three years, I think, since I led a debate here on hydrogen—I think it was one of the first here in the Senedd; I've presented another one since then. And since then, we've seen the beginnings of a hydrogen industry in Wales. I was very pleased to see the hub in Holyhead being developed. But what's crucially important as we move forward is to identify those sectors where we can make the most use of hydrogen. And I agree entirely that aiming towards using hydrogen on ferries that cross the Irish sea is something that we should be looking at. There is work being done in the fjords in Norway already, where carbon-zero shipping has to be used. Well, let's tie the developments in Holyhead with that ambition for the use of hydrogen on our seas and to produce more green hydrogen in Anglesey, which can possibly be pumped through the old oil pipeline to the industrial areas of north-west England. There are huge opportunities for us.

Thank you, Janet Finch-Saunders, also for giving me a minute of your time on this really important debate. And I certainly want to echo the comments of colleagues in terms of support for this really important potential and future industry. And of course, within all this, north Wales, in particular north-east Wales, has a great opportunity to see this technology flourish. And at this point, I'd like to put on record the good work highlighted and the good work being carried out by HyNet in north-east Wales, linking to north-west England. HyNet, as I'm sure many of us know, is the UK's leading industrial decarbonisation project, and, from the mid 2020s, in the next few years, it will be producing, storing and distributing low-carbon hydrogen to replace those fossil fuels in such an industrial part of the country. It will also be capturing and locking up carbon dioxide emissions from industry as well. So it's a very, very important piece of work taking place—billions of pounds have been invested into it as well. But, as I mentioned, this really does highlight to me the importance of working collaboratively across the border, and I'd ask the Minister to perhaps comment on that and encourage that continued cross-border collaboration with that HyNet project taking place in north-east Wales into the north-west of England. Diolch yn fawr iawn.

I call on the Minister for Climate Change to reply to the debate. Julie James.

Diolch, Dirprwy Lywydd. I very much welcome the opportunity to respond to this really interesting debate, and thank you, Janet, for bringing it forward. And everybody is absolutely right: the climate emergency demands that we use all the tools at our disposal to accelerate progress to a net-zero energy system. We are absolutely committed to moving our energy system away from fossil fuels and towards renewable energy, as a critical path to achieving our statutory targets and international obligations as a globally responsible nation.

So, alongside extensive renewables developments, hydrogen is likely to have a significant role in Wales's future power, transport and industrial sectors and may also offer an alternative to fossil fuel in our heating systems. Our engagement with industry in Wales, and through our newly established net-zero industry Wales panel, highlights that hydrogen has huge potential to reduce emissions and support the economic transition, especially in energy-intensive industries. For some, hydrogen is seen as key in their road map to net zero. Transport is another potential area of use, particularly for some heavy goods vehicles, rail and potentially aviation, and, indeed, for ferries, as Rhun pointed out. And for the power sector, hydrogen can act as a flexible energy vector to replace the role of gas-fired plant in renewables-based systems.

We're all very aware of the plans from RWE in Pembrokeshire and their ambitions to transition away from gas with hydrogen from renewables, supporting their net-zero ambitions. Wales is extremely well positioned to develop and capture the rapidly emerging economic opportunities offered by hydrogen, particularly when linked to the potential for offshore wind, including the Celtic and Irish seas. However, as I have mentioned before in this Chamber, it is essential that, as we look to decarbonise our sectors, we do not create incentives that lock us into continued dependency on fossil fuels. So, whilst I recognise there is a transition for some sectors in using hydrogen generated from fossil fuels, this must be a rapid transition indeed. We have to move to the exclusive use of green hydrogen as soon as is practically possible, and that is why the development of hydrogen has to be part of a much wider push for greater deployment of renewable energy. The opportunities from renewable energy generation to produce hydrogen when supply exceeds demand must be exploited. So, instead of paying windfarm operators to stop generating, we should pay them to provide a renewable energy source that can be stored and utilised when needed.

We also know there are cost and technical uncertainties in the deployment of hydrogen in the energy system. We are in a cost-of-living crisis, in part driven by high energy costs, so we have to ensure that our approach to decarbonising our energy system is a just one for all consumers, including businesses in Wales. So, that is why supporting innovation in both the private and public sectors is essential to ensure hydrogen and other forms of low-carbon energy contribute to our Net Zero Wales plan and support the economic and social regeneration of our communities.

Through innovation, we can speed up the necessary cost reductions and the deployment of green hydrogen at scale that are very badly needed. The first iteration of our Smart Living hybrid small business research initiative scheme supported 17 hydrogen feasibility and demonstration projects across Wales. The 17 projects in the first year of the scheme are delivering in all regions of Wales, as many Members have highlighted. They range through studies of microgreen hydrogen generation, hydrogen in rural areas, sustainable aviation fuel production, vehicle market development, community-based hydrogen production and a digital one-stop shop hydrogen advice and networking platform.

Our second phase of hybrid will fund a pipeline of business feasibility projects, as well as higher level demonstrator and prototyping work on the ground across the country, and it's our intention to create a pipeline for new Welsh businesses, supporting local ownership and wealth retention across Wales. As we do so, we are committed to working with the UK Government and have already been successful in leveraging in UK funding on the back of our investment. And whilst we very much welcome the funding that is available from the UK Government, if we are to achieve the ambitions for 10 GW by 2030, then more funding is urgently needed. And here I agree with the findings from the Skidmore review that the UK Government needs to confirm long-term funding to support the scaling up of hydrogen production. And I hope, Janet, that you will be making strong representations to colleagues in Westminster, off the back of Chris Skidmore's excellent review, to ensure a greater level of funding is available to support future hydrogen projects across all parts of the UK.

We have supported Welsh stakeholders with their potential bids for UK funding, and we will be learning the lessons from hydrogen heating trials elsewhere in the UK. And in the meantime, we will be assessing the role of hydrogen in heating in our heat strategy, which will be published this year, and as part of our energy-planning work.

So, Dirprwy Lywydd, we are absolutely committed to Wales being at the forefront of the development of this new sector and setting out our strategic approach to make that happen. Our hydrogen pathway sets out 10 objectives, focused on short-term actions, driving demand, production and cross-cutting action to 2025. They also set out avenues to plan for larger scale projects to ensure Wales is well positioned with respect to hydrogen and fuel-cell technologies. As we build on that pathway, we believe this will provide the strategic focus we need to make sure that hydrogen does and will have an important role to play in meeting net zero and make sure that Wales is well placed to be at the absolute forefront of this developing sector. Diolch.

Thank you, Minister, and thank you to all speakers this afternoon. That brings today's proceedings to a close.

The meeting ended at 18:30.