H100 NIA: Commercial & Regulatory Arrangements diagram
Project name: Commercial and Regulatory Arrangements (HyCORAL)
Project lead: SGN
Partners: University of Edinburgh
The HyCORAL elements aims to establish the commercial and regulatory implications of a full hydrogen chain including production, distribution and selling of hydrogen and to explore the various options to determine the optimal solution.
For this element, we developed a business model for our five-year demonstration and at least one fully developed business model for the ongoing running of the hydrogen demonstration site. This included an assessment of the various business model structures that could be implemented for the hydrogen network including, regulatory, investment, fully commercial and community incentivised. Current Gas Distribution Networks (GDN) licenses also do not authorise for the production and selling of gas. Therefore, we explored the risks associated with this current license implications and gap analysis and provide potential solutions.
To develop a business model, we studied the hydrogen market to identify sources that would be available for the duration of the project and will require:
- A review of commercially available hydrogen
- Discussions with suppliers on logistics of supply including transportation costs
- Review of alternatives for securing hydrogen supply
- An assessment of subsidy options including costs covered through transportation charges or more localised such as distribution charges.