Business

One of Britain’s biggest companies has warned that the UK risks squandering its lead in one of the most important green technologies because of the government’s reluctance to support its companies.

Johnson Matthey, the chemicals and metals company which is currently responsible for most of the world’s catalytic convertors, told Sky News it has intellectual property which could help the UK become a world leader in the production of green hydrogen.

But it warned that, with the United States now providing hundreds of billions of dollars of subsidies for those making similar products in America, the UK risked losing out on this part of the green industrial revolution.

In an exclusive interview, chief executive Liam Condon said: “I think the risk is that over time we will lose another leading, cutting-edge industry where the UK could be a global champion.

“I think batteries is gone – we’ve lost that. That race is, from my point of view, over.

“In hydrogen, the UK can still be a global champion. But we’ve got to move with a sense of urgency.

“The risk is if we don’t move with that sense of urgency, we will lose that next round of innovation as well. That’s real jobs for the future. Future-proof jobs for the next decade.”

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2:20

Could companies building things like industrial-scale batteries soon head across the Atlantic?

Mr Condon’s comments come amid growing consternation that the UK government has so far refused to provide any response to the US Inflation Reduction Act (IRA) – the $400bn set of green subsidies introduced by the White House.

Although the UK has a more developed renewable energy system than the US, the act is designed to incentivise companies to produce green products – be they solar panels, batteries or hydrogen plants – on American soil.

Many companies, Johnson Matthey included, have begun to shift investment across to the US.

Recently AMTE Power, the UK’s only home-grown battery company, told Sky News that it was considering relocating some of its production to the US.

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4:42

Subsidies in the United States might tempt one of the UK’s only battery producers to shift manufacturing there, Sky News revealed.

However, while many countries, including the US, struggle to compete with China in battery production, the race to dominate hydrogen remains far more open.

While the quest to turn hydrogen into a mainstream source of energy is not new and frequently suffers from undue hype, even sceptics agree that the fuel will play an important role in the green transition, especially as a backup source of energy for when the wind isn’t blowing and the sun isn’t shining.

Read more:
The future of energy may lie with hydrogen, but the journey to get there won’t be easy
Why the British steel industry is on the brink of extinction – or a green resurrection

Johnson Matthey produces some of the critical membranes and electrodes used in the most advanced hydrogen fuel cells, not to mention in the electrolysers which can turn water into the flammable gas without producing any carbon emissions.

However, it has already pivoted some of its investment into the US, recently announcing a long-term partnership deal with American hydrogen firm Plug Power.

The chancellor says Britain will have to wait until at least the autumn for more details of its response to the Inflation Reduction Act, and he hinted in a recent Sky News interview that the response may not include many subsidies.

But Mr Condon said: “The lack of certainty and clarity is a problem today.

“A lot of jobs are getting created in the US right now. Some of those jobs could be created in the UK but, because of the lack of clarity and certainty, they’re not.”

A government spokesperson said: “We are leading the world in reaching net zero and are cutting emissions faster than any other G7 country. And the UK is one of the top three countries in the world for our record investment in clean energy.

“We’re investing £30bn to support our green industrial revolution with up to £20bn for carbon capture, utilisation, and storage.

“We’ve also kick-started the hydrogen sector in the UK, with the first projects announced in our £240m net zero hydrogen fund – helping to deliver this new clean power source. This will create thousands of green jobs and help deliver on our priority to grow the economy.”

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