Net Zero Hydrogen Fund (NZHF) – Strand 2 Capital Expenditure (CAPEX)

Strand 2 of the NHZF offers UK registered organisations the opportunity to apply for Capital Expenditure (CAPEX) support for new low carbon hydrogen production facilities to begin deployment in the early 2020s. Strand 2 projects must demonstrate how you will develop a credible project that will contribute to the at-scale production of low carbon hydrogen by 2025. Interested? Feel free to contact us!


Competition closes: 06 July 2022, 11am

Applicants notified: 19 August 2022 (invite to interview), 12 September 2022 (interview panel), 30 September 2022 (applicants notified)

Project start date & duration: 1 January 2023 for between 6 and 27 months


This competition (Strand 2) will provide capital expenditure (CAPEX) to support low carbon projects to take a Final Investment Decision (FID) and begin deployment in the early 2020s. Projects must address low carbon hydrogen opportunities and must focus on construction of new low carbon hydrogen production facilities. Projects must not require support from a hydrogen business model (HBM) (these projects are covered in Strands 3 & 4 of the NZHF). Funded projects must support the delivery towards the 10GW production target by 2030 set out in the Energy Security Strategy.

Specific Themes

Capital projects that utilise one of the following hydrogen production types:

  • Electrolysis
  • Methane forming
  • Gasification

A portfolio approach to funding will be taken.

Projects that will not be funded

  • Those that do not focus on low carbon hydrogen production at scale and the immediate supply chains.
  • Those requiring an HBM.
  • Those not building new low carbon hydrogen production facilities
  • Those that are unable to take a FID within 3 months of receipt of a conditional grant offer letter.


  • State aid funding rules apply.
  • Your project must have a total grant request of between £200,000 and £30 million.
  • Must meet the Draft Low Carbon Hydrogen Standard.
  • Use core technology that has been tested in a commercial environment (TRL7 or more).
  • You must carry all of its project work in the UK and intend to exploit the results from or in the UK.

Funding rates

  • Funding allocation breakdown between Strand 1 and Strand 2 of this competition is not fixed (up to £90million pot across both strands of the competition).
  • UK registered businesses of any size can apply for funding of up to 30% of the eligible project costs.
  • Research organisations in a consortium can share up to 30% of the total eligible project costs.

How PNO can support you

The UK team has a strong track record in securing some of the most competitive national and European grants on behalf of its clients, with a full understanding of how a project should be presented to stand the highest chance of success. Each year in the UK alone, we are responsible for the submission of more than 100 funding applications across all sectors and priority areas. Based on this extensive experience, through careful project selection and using key insight into how a project should be best positioned, we consistently achieve success rates that are more than 5 times the typical success rates for UK national schemes and EU programmes.

Contact us for further information

     privacy statement is applicable