Unlocking green hydrogen fuel supply chains

Countries across the Asia-Pacific and Africa regions have great potential in the emerging hydrogen economy. However, as well as opportunities, there are challenges when it comes to scaling up the production and distribution of these greener fuels. Many countries in these regions are already developing national hydrogen strategies for domestic industries and export markets, increasing the potential for more energy-producing countries to prevail in the future.

Africa is widely regarded as a potential global leader in the production of green hydrogen, not only for itself but also for other regions such as Asia-Pacific, which is poised to become a major demand centre for Africa’s green hydrogen potential. The ambitious net-zero goals committed to by the maritime sector could have a major role to play in stimulating investment in the green hydrogen supply chain between the two regions.

Ahila Karan, senior lead on green initiatives at Lloyd’s Register's maritime decarbonisation hub
Ahila Karan, senior lead on green initiatives at Lloyd’s Register’s maritime decarbonisation hub

To reap the rewards, the industry must find creative ways to tackle various obstacles. While the Asia-Pacific region is the world’s largest hydrogen consumer, less than 1% of its hydrogen is green. The key challenge is the high price of green hydrogen, which costs at least six times more than grey hydrogen, and the lack of mechanisms to bridge the cost gap of green hydrogen-derived fuels, such as e-ammonia, e-methane and e-methanol.

Regardless of the growth opportunities within the maritime industry, financing hydrogen infrastructure is not going to be easy.  Building from the ground up is an expensive feat. Due to limited demand and significant cost differences compared to conventional fossil fuels, few are willing to lead from the front.

As demand for green energy grows and hydrogen markets continue to emerge, there is increased scope for willing nations to discuss untapped market opportunities for hydrogen-derived fuels for the shipping sector.

This was the focus of the second Maritime Fuel Supply Dialogues earlier this year – a roundtable discussion hosted by the Lloyd’s Register maritime decarbonisation hub  – shining a light on investments needed to support the development of hydrogen-based fuels to service shipping’s decarbonisation.

The hub is a joint initiative between Lloyd’s Register and Lloyd’s Register Foundation, aiming to accelerate the safe and sustainable decarbonisation of the maritime industry. This second roundtable brought together ministries, fuel developers, the shipping industry and climate and development financiers operating across the Africa and Asia-Pacific region.

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