ASA Adjudication on Wind Hydrogen Ltd

Ad

A leaflet for Wind Hydrogen Ltd (WHL) consisted of a proposal for the "Wings Law" wind farm near Kilbirnie in North Ayrshire and an associated hydrogen plant in nearby Glengarnock. The leaflet was distributed to households in the local area.

Issue

The complainant objected that the claims in the brochure were misleading because:

1. it stated that WHL's proposal for the wind farm and the hydrogen plant "was currently the subject of an application for £10 million funding from the DTI", but the complainant believed that at the time the brochure was published the advertisers had not applied for funding from the Department of Trade and Industry (now the Department for Business, Enterprise and Regulatory Reform, DBERR);

2. it stated that there was a direct link between the proposed wind farm and the proposed hydrogen plant, and that this enhanced the environmental credentials of the wind farm; "... the environmental credentials of the Wings Law project are enhanced even more through its association with the proposed hydrogen facility at Glengarnock" whereas the complainant did not believe this to be the case;

3. it implied that the electricity generated by the proposed wind farm and the hydrogen generated by the proposed hydrogen plant were going to be directly chemically related processes; "In parallel, the company is developing a Hydrogen Research, Development and Demonstration balancing scheme on the former steelworks site at Glengarnock, to provide energy balancing, to increase the quality of energy supplied by the wind farm ... [this] allow[s] energy generated from wind turbines to be stored and released when required, through hydrogen electrolysis... When wind levels are high, output from the turbines in excess of the pre-determined supply, is used to electrolyse water into hydrogen and oxygen. The hydrogen can then be liquefied and stored under pressure indefinitely. Conversely, during periods of low wind speeds the electricity produced from the wind turbines is supplemented from the stored hydrogen through internal combustion gensets or large format fuel cells." The complainant understood that there would in fact be no direct link and that electricity for the hydrogen plant would come from the National Grid;

4. it stated that the project was unique and new to Scotland, whereas the complainant believed that a similar programme was already in existence on the Isle of Unst.

CAP Code (Edition 11)

Response

1. WHL said they could demonstrate they were fully engaged in the application for funding from the Department for Business, Enterprise and Regulatory Reform (BERR) formerly the Department for Trade and Industry (DTI) at the time the brochure was produced.  They sent documents which they said showed they had registered for the BERR Technology Programme on 2 May 2007 and registered a "Formal Expression of Interest" for the Spring Collaborative Research and Development competition for funding within BERR's Technology Programme on the 11 June. They said they had intended to submit a completed application in the next round of the competition but that their final application in June 2007 had been delayed by various business management factors.

2. WHL said the wind farm and the hydrogen plant would be connected to the same 33 kV electricity supply and distribution network. They said they had made this clear throughout the public consultation process. They clarified that the projects would not be directly connected but would be connected via the National Grid.

WHL said the environmental credentials of the proposed wind farm were enhanced by association with the proposed hydrogen plant because the hydrogen plant offered a viable energy storage solution which dealt with the intermittent nature of electricity generated by wind farms. They said that, with increased penetration of electricity markets by renewable energy from wind power, there was an increased requirement for reserve supplies, and that without this reserve the ability of wind power to replace conventional plants was restricted. They said the application of a reliable standing reserve, in the form of hydrogen produced from electricity generated by wind power during periods of higher than expected wind speeds, and then combusted to produce electricity once again during periods of lower than average wind speeds, potentially allowed for an increase in the amount of wind power that could be absorbed into the electricity grid system.

They sent a copy of a patent for an invention for smoothing electrical power output from wind farms, which they said covered operating an electrolyser for the production of hydrogen from a wind farm with optimal efficiency.  They also sent a technical report on the business concepts and technology of hydrogen utilisation to balance wind energy which they said had been prepared by an independent expert for their Initial Public Offering (launch of stock market shares for sale to the public). They said excess energy transmitted to the National Grid from the Wings Law wind farm would be used to power the hydrogen balancing facility at the Lochshore hydrogen plant and no additional external power purchase would be necessary to enable the hydrogen demonstrator to function. They said their patent concerned taking the equivalent energy from the wind farm, calculated to be in excess of expected output, and producing hydrogen through electrolysis that could then be burned to produce electricity to be returned to the grid on demand. They said their patent by definition showed the direct link between the wind farm and the hydrogen facility. They said the proposed facility at Kilbirnie would be the world's first grid-connected commercial-sized prototype hydrogen balancing facility and that it would also research the use of hydrogen gas as a transportation fuel. They said the plan for this project had won the UK Institute of Electrical Engineers' inaugural "New Spirit Challenge" sustainability award in 2002, for sustainable technology development in energy.

WHL said they had used the established trade and professional body for UK wind and marine renewables industries, the British Wind Energy Association (BWEA) pollutant reduction figures in the calculations for reductions in carbon dioxide, nitrous oxides and sulphur dioxide given in their leaflet. They said that the hydrogen plant would not enhance these reduction figures when compared with those estimated for the wind farm alone. However, they said there was now a drive towards a low carbon economy and in the near future hydrogen, which was a "clean" potential source of fuel, could be used to power public transport and this was an option they would explore. They said that initially the hydrogen generated from the project would be used to store energy for release into the National Grid as required and could also be used as feedstock for the chemicals industry, for example to produce ammonia for fertiliser.   

3. WHL said that their leaflet made no reference to the energy and hydrogen which would be generated by the wind farm and hydrogen plants respectively being "directly chemically related" and that this assertion did not make sense from a technical point of view because electricity was not a chemical process. They clarified that the message they wished to get across was that excess electrical energy generated by high wind speeds could be used to charge electrolysers at the hydrogen plant producing hydrogen for energy storage. They said both developments would be connected to the same electrical network, namely, the National Grid.

4. WHL said the Isle of Unst development was not connected to the National Grid and that WHL owned the intellectual property rights to develop a grid connected Wind Hydrogen concept. They said their project therefore was both unique and new to Scotland.

Assessment

1. Upheld

The ASA noted that the WHL brochure was distributed to households in May 2007 and was available to the public between the 7 and 15 June 2007 at WHL's public exhibitions. We noted WHL's evidence to show they had registered for the BERR Technology Programme on 2 May 2007. However, we also noted the response from BERR which clarified that this registration was for the Technology Programme extranet and did not constitute a Registration of Interest for any Technology Programme competition. We noted WHL's "Registration of Intention" with BERR under the BERR Technology Programme Spring 2007 competition on 11 June, but also that WHL did not submit an application before the deadline. We accepted that business factors may have delayed the application after the brochure was produced and distributed. However, we considered that the wording of the brochure, which stated "This award winning project has been identified by the International Energy Agency and the UK Department of Trade and Industry and is currently the subject of an application for £10 million funding from the DTI" could mislead, by giving readers the impression that the application for funding was more secure and further advanced than it was.

On this point the ad breached CAP Code clauses 3.1 (Substantiation) and 7.1 (Truthfulness).

2. Upheld

We acknowledged that the WHL brochure attempted to explain the technical concept of "electricity balancing" to the lay person and noted they had provided a technical report as part of their submission that was prepared as part of their Initial Public Offering (stock market flotation to the public). However, we considered that the brochure did not make sufficiently clear to readers that the proposed wind farm and hydrogen plant would not be directly connected but would be connected via the National Grid, as this was not stated in the brochure. We considered that the concept of "electricity balancing" was unlikely to be well understood by most consumers, and that the wording of the brochure could mislead by giving the impression the link between the two proposed facilities was concrete rather than mediated via the National Grid.

We noted the environmental credentials of the proposed wind farm were represented in the brochure as including a "major saving in fossil fuel emissions", a "land management and wildlife enhancement plan" and contribution to the Government's renewable energy targets. We noted the reduction figures given for carbon dioxide, nitrogen oxides and sulphur dioxide and understood WHL had followed BWEA guidelines current at the time the brochure went to press in respect of these. However, we noted no explanation of their derivation was given in the brochure, and considered it would not be clear to readers whether these projected emission-reduction figures were purportedly enhanced by the wind farm's association with the hydrogen plant or not. We understood from WHL that the pollution reduction figures given in their brochure were not enhanced by the association of the wind farm with the hydrogen plant at the present time, although that might change in the future.

We understood that the electricity produced by a wind farm was variable, depending on wind speeds, and that more electricity was put into the National Grid when the local wind speed was high and less when it was low. We understood that, when the wind was not blowing, no electricity was generated and therefore the BERR figure for the average capacity of wind turbines was 30%. We also understood that at present the amount of power supplied to the National Grid from wind farms was under 10%and that back-up systems designed to cope with sudden power stoppages at power stations of all varieties were already in place and were adequate to cope with the intermittent nature of wind power at current levels. We understood that the National Grid was a displacement system, meaning that for every bit of electricity used the same amount must be supplied, and that there was no storage of electricity. We also understood that it was not possible to determine where electricity from any single generation source was finally used in the National Grid. We understood WHL's concept was that when the expected electricity output at the "Wings Law" wind farm was exceeded due to higher wind speeds, that electricity calculated to be "in excess" would be used by the hydrogen plant at Kilbirnie to electrolyse water, producing hydrogen. The hydrogen could then be used to generate electricity to put back into the National Grid when required through fuel cell technology or a combustion engine linked to an electrical generator. We understood that in practice however there would be no direct electricity transfer from the wind farm to the hydrogen plant and that the electricity for the hydrogen plant would be supplied via the National Grid, which in reality would come from a number of sources, some renewable and some not. We understood that the quantity of electricity transferred to the hydrogen plant indirectly from the renewable source of the wind farm, via the National Grid, would be calculated to be equivalent to an amount of electricity produced by the Wings Law farm when wind speeds were higher than expected, and would be mediated via a Government certificate trading scheme.

We noted the technical report submitted by WHL stated that intermittent wind energy generation could be problematic in terms of smooth continuous electricity supply in the future, at high penetrations of wind energy within a countrys grid system where supply and demand needed to be balanced in real time. However, we understood from that report that the anticipated scale of the hydrogen equipment proposed at Kilbirnie was relatively small compared to the overall capacity of the Ladymoor wind farm, and that the technology required for the conversion of stored hydrogen back to electricity on a large scale was still under development.  

We understood that WHL considered their proposed wind farm near Kilbirnie would have its environmental credentials enhanced by the proposed hydrogen plant Glengarnock in part in respect of a contribution to the Government's renewable energy targets. We acknowledged that WHL's proposed Hydrogen Plant could conceptually be said to be part of a mechanism which was likely to contribute to the Government's renewable energy targets in future. We noted that under the Governments Renewables Obligation Order 2006 renewable energy to storage systems (including hydrogen balancing systems) could qualify for Renewables Obligation Certificates (ROCs), although electricity produced as the result of conversion from hydrogen storage could not. We understood one ROC was issued for each megawatt-hour (MWh) of eligible renewable output. We noted that the technical report submitted by WHL stated that exactly how many ROCs a hydrogen balancing scheme such as that proposed would be eligible for would depend on whether hydrogen production was matched on a continuous basis by variation in wind power output or was only produced during off-peak times, and that verification with the Office of Gas and Electricity Markets (OFGEM) would be required. We further noted the report considered the proposed hydrogen project at Kilbirinie was a demonstration facility which allowed for proof of concept before larger future investment and expansion.

We noted that if more of the National Grid was supplied by wind power in the future, the significance of "electricity balancing" using hydrogen was likely to increase, and that WHL's proposed project was in effect a pilot for the future. We considered that whilst it was reasonable for the brochure to suggest that the WHL development could contribute to the Government's renewable energy targets, it was insufficiently clear in its explanation as to the mechanism by which this would, in reality, take place, which would be via the National Grid and a Government approved electricity from renewable sources certificates trading system.

We acknowledged the advertiser's response with regard to other future uses for hydrogen and noted that prototype hydrogen cars had already been developed by a number of leading car manufacturers and that it was very likely hydrogen powered vehicles would be on the roads in the UK in the next two decades. We understood that, subject to the method by which the hydrogen was produced, hydrogen fuelled vehicles were likely to be of benefit to the environment because they did not release carbon dioxide or other greenhouse gases that could contribute to global warming, into the atmosphere. We considered Wind Hydrogen had shown their hydrogen plant in Glengarnock, because of its association with the wind farm near Kilbirnie, had the potential to contribute to environmental well-being if the hydrogen produced there were to be utilised in hydrogen powered vehicles, but understood this was a potential environmental contribution only, as hydrogen vehicles were not yet on the roads, and was therefore at the present time, speculative.

We noted the brochure explained that the hydrogen from the hydrogen plant could also be used to produce feedstock for the chemicals industry, in particular ammonia for fertiliser, and that at present the hydrogen for the production of ammonia came from natural gas in a process which released carbon dioxide into the atmosphere. We acknowledged that a reduction in carbon dioxide emissions was an environmental benefit. However, we considered that it was difficult to assess the overall environmental credentials of this part of the proposed Hydrogen Plant output because some chemicals produced in the chemical industry from the hydrogen generated might potentially be detrimental to the environment, for instance ammonia was used to make nitrate-based fertilisers, and nitrous oxide from nitrate-based fertilisers is a climate change gas. We considered that describing hydrogen production for the chemical industry as a net environmental benefit in the brochure, without further data or general agreement in the scientific community to support that claim, could mislead.

We noted the technical report sent by WHL considered that the proposed hydrogen project at Kilbirinie was a demonstration facility that allowed for proof of concept. We considered WHL had submitted evidence to show that the proposed hydrogen plant at Kilbirnie had the potential to enhance the environmental credentials of the Ladymoor wind farm. This could happen if, subject to successful piloting, there was development of the hydrogen equipment on a larger scale there in the future. This is supposing that significant amounts of hydrogen could be produced and converted back to electricity there or used as an alternative fuel for vehicles. However, we concluded that, although WHL had demonstrated potential for the future, at the pressent time they had not shown that the environmental credentials of the project would definitely be enhanced by its association with the proposed hydrogen facility. We considered that the claim "... the environmental credentials of the Wings Law project are enhanced even more through its association with the proposed hydrogen facility at Glengarnock" implied that the wind hydrogen balancing project would result in significantly enhanced "green" output from the wind farm immediately and concluded that WHL had not justified the absolute claim. We told WHL to phrase similar forward-looking claims more tentatively in future.

On this point the ad breached CAP Code clauses 3.1 (Substantiation) 3.1 (Division of Opinion) 7.1 (Truthfulness) 49.1 (Qualification) and 49.2 (Environmental Claims).

3. Upheld

We considered that the PURE project on the Isle of Unst exhibited a directly traceable connection between electricity produced from wind power and the subsequent production of hydrogen through electrolysis utilising that electricity, because that project was not connected to the National Grid. We also considered that the WHL brochure accurately described the process of "electricity balancing" in an off-the-grid situation and noted the technical report contained forward-looking statements about the potential for wind energy and wind hydrogen balancing. However, we considered that the brochure did not make clear to readers that the relationship between the proposed Wind Farm and the proposed Hydrogen Plant was mediated via the National Grid, not a direct connection, and that it was not possible to guarantee that electricity generated by the Wind Farm would be directly responsible for electrolysis at the Hydrogen Plant. We considered that the claim "When wind levels are high, output from the turbines in excess of the pre-determined supply, is used to eletrolyse water into hydrogen and oxygen" implied that electricity generated by the wind farm would be directly used at the hydrogen plant and concluded that WHL had not justified the claim.

On this point the ad breached CAP Code clauses 3.1 (Substantiation) 7.1 (Truthfulness) and 49.1 (Qualification).

4. Not upheld

We noted that the principle behind the PURE Isle of Unst project was similar to that of the proposed Wind Hydrogen project on the Scottish mainland. We also noted that the PURE Isle of Unst project was an off-the-grid community project and therefore of a much smaller scale than the proposed WHL development and was already in the process of developing hydrogen-powered vehicles to utilise the hydrogen produced in association with wind power there. However, we acknowledged that WHL had a patent for their wind hydrogen balancing technology and the WHL project differed from the Unst one in that it would be a large-scale, grid-connected system. We considered that readers would understand from the claim "What makes this wind farm different from any other ever proposed in Scotland is the associated research, development and demonstration facility at Lochshore Business Park in Glengarnock which, through the use of patented technology, will use excess power from the wind farm to create and store hydrogen for electricity grid and power balancing as an alternative fuel source" that WHL were making a claim for their specific facility and technology, not the general principle of wind hydrogen balancing. We concluded that, in this context, the claim "unique and new to Scotland" was unlikely to mislead.

On this point we investigated the ad under CAP Code clauses 3.1 (Substantiation) and 7.1 (Truthfulness) but did not find it in breach.

Action

The claims made in the brochure that were found to breach the Code should not appear again in their current form.

Adjudication of the ASA Council (Non-broadcast)