What is the Gas Shipper Obligation?
In January 2025, DESNZ published their Consultation on the proposed Gas Shipper Obligation (GSO), where LCCC was named as the likely GSO administrator.
The GSO is a planned levy on gas shippers licensed in the UK, which will be the long-term funding mechanism for the Low Carbon Hydrogen Agreement (LCHA) model.
The GSO will empower the decarbonisation of carbon intensive industries and lead to an estimated £13bn to £24bn in savings to the power system between 2030 and 2050 through the funding the LCHA. The LCHA is a revenue support mechanism designed to incentivise investment in clean hydrogen production and usage.
In our capacity as GSO administrator, we will manage the levy collection from gas shippers and payments to the LCHA counterparty.
The levy is expected to come into effect in 2027.
Who are our delivery partners?
The Department for Energy Security and Net Zero (DESNZ) will set the policy and governance arrangements for the scheme, including our remit as administrator.
XOSERVE: As the Central Data Service Provider (CDSP) for Britain’s gas market, Xoserve will provide the gas shipping quantity data necessary to ensure the total levy collection is fairly allocated among shippers.