Government pledges £32.5m to decarbonise industry
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New government funding will support British industries, including construction, mining and quarrying, to reduce their reliance on fossil fuels.
The second phase of the Red Diesel Replacement Competition will provide a £32.5m funding package to support innovative projects that are developing greener energy alternatives, the government has announced.
The funding is expected to be focused on greener alternatives to red diesel such as electrification and green hydrogen, providing a pathway for industry to cut emissions and energy costs.
Red diesel - also known as gas oil - is a type of fossil fuel commonly used for off-road, heavy-duty vehicles and machinery, such as bulldozers and cranes.
In April 2022, the government made changes to red diesel eligibility, restricting the use of the fuel in most sectors, as a way to pave a path towards net zero. In September of that year, the Red Diesel Replacement Competition was launched to develop affordable and efficient alternatives.
The new £32.5m package follows the £6.7m provided to 17 winners under Phase 1 of the competition, in areas covering electrification, e-fuels and green hydrogen, as well as technologies that capture and store energy.
The recent funding will serve to further support these projects.
"These industrial sectors, and the jobs they create, are crucial to our economy, and they also have an important role to play in our shift towards a greener, more secure future," said Graham Stuart, minister for energy and climate change.
"This latest round of funding will help to speed up industrial decarbonisation, providing industry and consumers with effective low-carbon alternatives to red diesel while boosting green investment to future-proof the resilience of British industry."
Mahle Powertrain was one of the recipients of the funding. Its partnership with the University of Nottingham and Clean Air Power received £425,072 to build two prototype engines capable of running on ammonia and hydrogen, with the aim of providing a pathway for the sustainable use of heavy-duty engines.
In addition, Catagen received £787,700 for two projects, an e-fuel generator to develop e-diesel, and a novel hydrogen compressor, while Ulemco was granted £418,613 to convert a piling machine to run on hydrogen fuel.
Steamology Motion received £364,717 to build a prototype demonstrator of its high-power, zero-emission steam turbine drivetrain, proving a viable red diesel engine replacement technology.
"Off-highway industries such as mining, quarrying and construction remain a significant challenge in the transition towards a more sustainable future," said Jonathan Hall, head of research and advanced engineering at Mahle Powertrain.
"Exploring other power sources such as ammonia has considerable potential, and the funding provided by BEIS via the Red Diesel Replacement programme has enabled us to develop these innovative, zero-carbon powertrain solutions."
While hydrogen is a potentially zero-carbon fuel source, it can be more carbon intensive than gas and coal if derived from fossil fuels rather than through electrolysis powered by a renewable energy source, what is known as ‘green hydrogen’.
The recent funding announcement forms part of the government's £1bn Net Zero Innovation Portfolio, which aims to help to accelerate the commercialisation of low-carbon technologies, systems and business models in power, buildings, and industry.
The UK announcement follows the European Commission’s September reveal of a €3bn hydrogen bank, designed to help build a future market for the fuel
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