The UK has moved to reinforce its domestic clean energy capabilities with a significant investment in hydrogen technology, centred in South Yorkshire.
The funding package is expected to generate more than 400 jobs and position the region at the forefront of European hydrogen production infrastructure.
At the heart of the announcement is a £40m commitment from Great British Energy, paired with a government grant in principle worth £46.5m. The funding will support ITM Power’s expansion plans, a Sheffield-based firm specialising in hydrogen electrolyser systems.
Commenting on the investment, UK Energy Secretary Ed Miliband said: “This investment is the government’s clean energy mission in action – rebuilding our energy security with clean homegrown power and good industrial jobs for South Yorkshire.
“Communities have long been calling out for a new generation of good industrial jobs, and with these plans, we answer that call, helping to create an economy in which there is no need to leave your hometown just to find a decent job.
“Thanks to this government’s commitment to clean energy, a generation of young people in our industrial heartlands can have well-paid, secure jobs.
“This has only happened thanks to months of intense collaboration between Great British Energy, our publicly owned energy company, the government and ITM Power. It is time to make and build things in Britain again, and with this government’s clean energy mission, we will.”
Scaling up hydrogen electrolyser production
The investment will enable ITM Power to scale its South Yorkshire facility to 1 gigawatt (GW), significantly increasing the UK’s ability to manufacture hydrogen electrolyser units. These systems are essential for producing green hydrogen by splitting water with electricity.
A hydrogen electrolyser is widely seen as a cornerstone technology in the transition away from fossil fuels. Without it, large-scale green hydrogen production would remain unviable.
The expanded facility is expected to anchor what officials describe as Europe’s largest electrolyser manufacturing cluster.
Advancing next-generation electrolyser technology
A key component of the expansion is the rollout of ITM Power’s next-generation hydrogen electrolyser platform, known as Chronos.
The system is designed to improve efficiency while lowering production costs, addressing two of the main barriers to wider hydrogen adoption.
By making hydrogen production more economically viable, the technology could accelerate uptake in sectors that are difficult to decarbonise, such as heavy industry, chemicals, and long-haul transport.
Businesses in these sectors have faced ongoing exposure to volatile fossil fuel prices, a challenge that hydrogen aims to mitigate.
Dennis Schulz, CEO of ITM, added: “We are grateful for the confidence and support demonstrated by the UK Government. Clean power increasingly underpins energy sovereignty and resilience, which are critical to long-term economic success.
“The UK Government’s support, through a combination of equity participation and grant funding, marks a pivotal step in establishing ITM at the centre of the UK’s hydrogen economy and firmly positions us as a natural partner for projects in the UK.
“The funds will enable the build-out of large-scale domestic manufacturing of our next-generation Chronos platform, underpinning confidence in our technology and sustained growth.”
South Yorkshire’s industrial transition
The project represents a broader industrial shift for South Yorkshire, a region historically associated with steel and heavy manufacturing.
This transition will create roles spanning engineering, construction, and supply chain operations, offering a pipeline of skilled employment tied to low-carbon technologies.
Local economic benefits are expected to ripple beyond the immediate site, with suppliers and contractors across the UK likely to see increased demand.
The move also reinforces the government’s strategy of building regional clean energy hubs rather than concentrating investment in a single area.
Strategic backing for a growing sector
The investment aligns with the UK government’s broader commitment to hydrogen as a pillar of its clean energy strategy.
Officials have identified the hydrogen electrolyser market as critical to achieving energy independence and long-term emissions reductions.
This latest funding builds on a previously announced £500m allocation for hydrogen infrastructure, alongside progress on early-stage projects.
Ten green hydrogen developments from the initial project wave have already secured contracts and are moving toward operational status.
A flagship investment from Great British Energy
For Great British Energy, the South Yorkshire project marks its largest single investment to date under its ‘Energy Engineered in the UK’ initiative.
The £1bn programme is intended to strengthen domestic supply chains, support British clean energy firms, and create high-value jobs.
The scale of this hydrogen electrolyser expansion signals a clear intent: to establish the UK not just as a user of clean energy technologies, but as a major manufacturer and exporter.
If successful, South Yorkshire could become a defining centre in Europe’s hydrogen economy.
