More than 60% of all clean hydrogen will be transported over long distances by 2050: Hydrogen Council
Pure H2 will be traded via pipeline, with derivatives such as ammonia moving by ship, says new report
A vast network of long-distance shipping and pipeline routes will be built by 2050 for the trading of just over 60% of the world’s hydrogen supply, according to a new report by Hydrogen Council and the consulting firm McKinsey.
About 190 million tonnes — 29% of the 660 million tonnes of hydrogen needed annually around the world to reach net-zero emissions — will cross international borders by mid-century, it adds.
In total, the international trading of hydrogen and its derivatives will reduce the cost of the global energy transition by $6bn, it says.
The US, the Middle East, Africa, Australia, Chile and Norway will largely become clean-hydrogen exporters, while the rest of Europe, India, China, South Korea, and Japan will mainly be importers.
Green hydrogen will be able to be produced at under $1.15/kg in the US, China, the Middle East, South America, Namibia and South Africa, while hydrogen produced in places with limited available land for renewables projects, such as Europe, Japan and South Korea, would exceed $1.80/kg and sometimes more than $2.50/kg in 2050.
“Consequently, decarbonization of existing power is likely to be prioritized over new renewable-hydrogen production, except where hydrogen is used as a [grid] balancing tool,” the report explains.
“Pure hydrogen is expected to be a ‘regional’ business and will be predominantly sourced domestically or piped from nearby regions, and only shipped via a carrier (ammonia, liquid hydrogen or LOHC [liquid organic hydrogen carrier]) if the prior options are not available,” said the Hydrogen Council.
“However, hydrogen derivatives including ammonia for end use, methanol, synthetic kerosene and direct reduced iron [ie, sponge iron] will be shipped around the world given relatively low transportation costs, compared to production costs.”
It adds: “The evolution of hydrogen trade flows is expected to take place in four distinct phases, beginning with hydrogen derivative shipping by 2025, followed by the emergence of long-distance hydrogen pipelines by 2030, shipping and pipeline reaching scale by 2040, and a fully mature traded market by 2050.”
The Hydrogen Council/McKinsey report barely distinguishes between green and blue or any other types of hydrogen in their trading figures, but it states that 71% of all hydrogen will be produced from renewable energy in 2050, with the remaining 29% being blue.
More than half of the H2 manufactured in North America, the Middle East and former Soviet states will be blue by mid-century, it adds.
How do the figures compare to Irena’s forecasts?
“Pure hydrogen is expected to be transported mainly using existing natural gas networks that are repurposed to carry hydrogen,” said the Irena report. “They represent the cheapest option for transporting pure hydrogen, at costs of $0.08-0.12/kg per 1,000km in 2050.”
The costs of transporting hydrogen through new pipelines would be twice as high, at $0.16-0.24/kg for every 1,000km, but it would still be lower than shipping options for distances of 3,000-5,000km, it added.
“For longer distances or places without existing natural gas infrastructure, ammonia ships become the most attractive option.”
Irena predicts a global hydrogen demand of 614 million tonnes by 2050, while the International Energy Agency forecasts 520 million tonnes. The world currently produces 70-75 million tonnes of mainly grey hydrogen (from unabated fossil fuels), with another 20 million tonnes mixed with other gases.
Its steering members include a host of fossil-fuel companies, including Saudi Aramco, BP, Shell, TotalEnergies and Equinor, and vehicle manufacturers GM, Honda, Hyundai, BMW, Daimler and Toyota.
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