ANALYSIS | How much green hydrogen and renewable energy will be needed to decarbonise global shipping?
Hundreds of gigawatts of new wind and solar would be needed to produce enough ammonia and methanol to make a dent in maritime emissions by 2030
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If the hydrogen used to make these chemicals is green, then the maritime sector could reach net zero emissions if it switches to these cleaner fuels.
But given that the global fleet of ships already uses hundreds of millions of tonnes of fossil fuels every year, how much hydrogen would need to be produced to decarbonise shipping? And how many gigawatts of renewables would need to be installed to power that scale of production?
How many tonnes of hydrogen?
However, making a dent in shipping emissions in the short term is also expected to require vast volumes of hydrogen — with less time to build out infrastructure.
Maritime certification agency DNV expects an even smaller share of green fuels by 2030.
However, Eirik Ovrum, DNV’s principal consultant in maritime environmental technology, notes that the 17 million tonnes oil-equivalent figure represents an upper bound “but it could potentially be much less”.
What does that mean for upstream renewable electricity?
The IEA estimated in a recent report that for a 10% share of green fuels in shipping by 2030, an extra 600TWh of renewable electricity would be needed to power hydrogen production.
The agency estimates that this, combined with the 1,500TWh for e-fuels to make up a 10% share of aviation fuel, would be equivalent to 23% of the scale of clean electricity capacity it predicts to be installed between 2022 and 2030 in its STEPS (ie, business as usual) scenario.
Ovrum estimates that producing 17 million tonnes oil-equivalent of green hydrogen-based fuels would require around 500TWh of electricity, which in turn would need 230GW of installed wind and solar capacity, saying “Norway produces about 140TWh per year, for comparison.”
So does this mean the build-out of upstream wind and solar assets could present a potential bottleneck for reducing ship emissions?
“Renewable electricity is a sought-after commodity by other sectors than shipping, electricity production needs to be scaled up in many different countries,” Ovrum warns. “This could both lead to less supply than demand, or perhaps higher prices in the short term, resulting in reduced demand.”
However, Irena’s head of innovation and end-use applications, Francisco Boshell, is more optimistic, noting that 1,200GW of renewable energy capacity to power electrolysers by 2050 would require 46GW of new wind and solar built every year until then.
“Renewable energy deployment is not a bottleneck for the energy transition. We know that renewable potentials are more than enough to satisfy this demand, and the same can be said for the materials needed to build this infrastructure.”
However, Boshell cautions that there will still be challenges around “rapidly creating the enabling frameworks to build up the renewable electricity capacity, source the carbon for the e-fuels [ie, methanol], and build the infrastructure to manage and trade those e-fuels”.
“We need the timely mobilisation of finance, growing and diversified supply chains — including sourcing materials, refining, manufacturing capacity and skills among others — and developing the necessary infrastructure for these fuels to thrive.”
What about electrolysers?
While different analysts are split on whether renewables will present a bottleneck, they agree that hundreds of gigawatts of electrolysers will need to be installed.
The agency estimates there are are 175GW of sufficiently-advanced electrolyser projects planned by 2030, although many of these will also have to feed into large-scale demand not only to displace grey hydrogen in existing sectors, but to produce e-fuels for the aviation industry. However, if early-stage concepts are counted, the pipeline rises to 420GW.
However, most of these tracked projects have not reached a final investment decision or started construction. The Norwegian firm cautions in its 2050 forecast that lead times for green hydrogen projects with more than 1GW of electrolysis capacity can range from six to ten years, meaning “only a few projects that are not already announced will be operational before 2030”.
Additionally, many of these projects are not specifically dedicated to supplying the maritime sector.
While DNV notes that “if all the produced carbon-neutral fuels in 2030 end up being available to the shipping industry, the supply would cover the demand with a margin”, it also calculates that existing industries such as fertilisers and chemicals already consume around 120 million tonnes oil-equivalent per year, or 40% of the energy demand in the shipping sector.
“This methanol and ammonia are currently produced from fossil sources with GHG [greenhouse gas] emissions, and these industries will most likely compete for the same carbon-neutral methanol and ammonia towards 2030,” DNV warns.
Meanwhile, Irena anticipates that around 600GW of electrolysers would need to be installed to produce its projected 60 million tonnes of green hydrogen for shipping fuels by 2050.
IMO and EU targets for clean shipping fuels
Far less green hydrogen will likely be needed for shipping to comply with current targets and regulations to reduce greenhouse gas emissions.
The International Maritime Organization (IMO), the UN agency that regulates global shipping, has set out a target for net-zero emissions “close to” 2050, with a 40% reduction in carbon intensity across global shipping by 2030.
This strategy also includes a target for the uptake of “zero or near-zero GHG emission technologies, fuels and/or energy sources” to account for at least 5% and “striving for 10%” of final energy consumption by 2030, which would suggest a scale of green hydrogen production somewhere between the DNV and IEA scenarios would be needed.
However, this does not refer purely to hydrogen-based fuels, with battery-powered or hybrid-electric propulsion systems explicitly included in the IMO definition, and biofuels likely to count too.
Last September, the EU signed its FuelEU package into law, setting out legally binding targets for ships operating in European waters to reduce their emissions.
However, in the calculations of greenhouse gas intensity, vessels will be rewarded for using hydrogen or its derivatives — known in EU parlance as renewable fuels of non-biological origin (RFNBOs) — between the start of 2025 and the end of 2033, by allowing the double-counting of their emissions savings from using these fuels.
If the share of RFNBOs in maritime fuels used in the EU is less than 1% in 2031, the EU will set a binding target for ships to use 2% of these fuels in annual on-board energy consumption by the beginning of 2034.
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