The HSE employee was testing a prototype hydrogen storage vessel on 4 October 2016 when the incident happened. While he was filling the vessel, a connector failed and hydrogen escaped under pressure.
The gas, which is flammable when mixed with oxygen, ignited and burned the employee who was a short distance away from the experimental hydrogen test rig. The employee has since returned to work.
HSE inspectors found the facility had failed to assess, plan, manage and control the risks of an experiment to determine if the design of the test rig was suitable for its intended use.
The investigation team, led by the field operations division, concluded that the incident could have been prevented had the HSE research team at the testing facility followed the regulator's own guidance.
The HSE served itself with an improvement notice, which required it to provide a system of work for proof testing and leak testing the hydrogen line and test tank.
Director of field operations, Samantha Peace said the HSE had fallen below the required standard and as the failings had put workers' lives at risk, a Crown Censure was the right course of action.
She said the HSE had fully co-operated with itself, "and we are satisfied that action has been taken to put matters right."
As a governmental body, the UK regulator cannot face prosecution in the same way as private or commercial organisations. A Crown Censure is the maximum sanction a government body can receive. Although no financial penalty can be imposed on the HSE, once a Crown Censure has been accepted, it is an official record of the governmental body's failure to meet the standards set out in law. HSE's admission means it accepted it had breached its duty under s 2 of the Health and Safety at Work Act 1974.