A £920 million project could create 'green' hydrogen to power industry and help heat two million homes in north west England, gas distributor Cadent has said.

The planned scheme would help reduce the carbon footprint of homes and industrial processes, generate more than 5,000 jobs, and over the longer term could provide a 'clean' fuel for trains, lorries and buses, the company said.

The scheme has the backing of the region's metro mayors, Steve  Rotheram and Andy Burnham, but Cadent said it still had to 'clear some hurdles' to make it happen.

Natural gas, which produces carbon emissions when it is burned in industrial processes or household boilers, would be converted to cleaner hydrogen for use in industrial processes and injected into the gas grid to heat homes.

Under the plans, carbon emissions from converting methane-rich natural gas to hydrogen will be captured and stored in soon-to-be decommissioned gas fields offshore in Liverpool Bay.

Cadent, the UK's largest gas distribution network, said the 'HyNet' scheme would reduce carbon emissions by more than a million tonnes a year, the equivalent of taking 600,000 cars off the road.

It is hoped the scheme will be up and running by the mid 2020s, and would be the first large scale UK use of hydrogen to help solve the difficulties of cutting carbon from industrial processes and heating homes, it said.

Hydrogen is zero-carbon at the point of use, producing just heat and water when it is burned.

It will be produced in gas-powered facilities, but most of the carbon from its production from natural gas will be captured and stored, delivering the overall saving of one million tonnes of carbon dioxide, Cadent said.

Hydrogen extracted from natural gas at a new purpose-built production facility, probably in Cheshire, would flow by a new pipeline to up to 10 sites including oil refineries and manufacturing plants.

The gas would also be blended to make up to 20% of the natural gas used to heat domestic properties, lowering the carbon footprint of two million homes in Cheshire, Merseyside and Greater Manchester.

Mr Rotheram said: “The building blocks are rapidly falling into place to enable the Liverpool City Region and the North West to lead the way in finding cleaner, greener sources of energy.

"Using hydrogen to power industry and heat homes in phase one is very exciting, but this HyNet project also sets out a longer-term roadmap towards supplying hydrogen to fuel our trains and buses.

"It’s visionary, timely and just what we need.”

It said it needed favourable Government policies for the process of capturing and storing the carbon emissions, and to prove to the Health and Safety Executive that the volumes of hydrogen were safe for homes, with a project at Keele University, Staffordshire, under way to show that.

Simon Fairman, director of safety and network strategy at Cadent, said: "This is unquestionably one of the most exciting energy projects for the north west in years.

"We chose the region because it is already home to 10% of the UK's biggest users of gas, as well as it having an ideal site on the doorstep to store the carbon that's produced in making hydrogen.

"HyNet will create and secure thousands of jobs, up to 80% locally, through the design, installation, construction and operation of the new hydrogen and carbon storage infrastructure needed.

"We're talking huge numbers, but we're also talking about a huge impact in solving a problem facing us all in the UK, how to decarbonise heat."