In a previous article, we looked at some of the pros and cons of hydrogen-powered vehicles versus EVs, which will undoubtedly shape policy-making and influence investment decisions, both around developing viable hydrogen fuel cell technology and its associated infrastructure.
In this piece, we summarise some of the key market drivers and look at notable global hydrogen projects that are coming on stream to cement hydrogen’s role in carbon-free transportation, and consider some of the challenges that apply to the whole market.
Key market drivers and critical projects in different transport sectors
Key market drivers:
- Hydrogen has a significant advantage over jet fuel in regard to energy per unit mass. Airbus considers hydrogen to have a specific energy per unit mass that is three times higher than traditional jet fuel.
- The aviation industry has had significant criticism levelled at it due to its greenhouse gas-intensive aircraft. To meet climate targets and ensure further governmental approval, a change of fuel is critical for the industry. To this end, it has been estimated that hydrogen has the potential to reduce aviation’s CO2 emissions by up to 50%.
- Airbus considers hydrogen to be one of the most promising zero-emission technologies for future aircraft. It is currently developing ‘ZEROe’, a project exploring three concepts for the world’s first zero-emission commercial aircraft by 2035. Each of these concepts relies on hydrogen as a primary power source.
- EasyJet has announced the development of hydrogen combustion technology in partnership with Rolls-Royce. This signals a move away from ‘electrification’ of the short-haul sector which had always been thought of as the main contender in replacing fossil fuel combustion at these distances. The development of electrical battery technology will undoubtedly play a key role, but there is obvious appetite for hydrogen to be at the forefront of future aviation fuel.
Key market driver:
- Hydrogen’s ability to be stored in large amounts for long periods of time and the fact that fuel cells can be seamlessly retrofitted to most active ships are considered especially attractive factors for the shipping industry. In addition, the use of liquid hydrogen carriers such as green ammonia (made from the reaction of green hydrogen and nitrogen using high pressure and temperature) or methanol offer a liquid-dense fuel to further facilitate long distance freight transport.
- The SHAPE UK project will install a green hydrogen generation and storage system within Portsmouth International Port. It will also supply a hydrogen-powered vessel to the port authority. Further, the Freeport East Hydrogen Hub, which will include several renewable sources of fuel, has committed to producing 1GW of hydrogen by 2030.
Public Transport: Railway & Bus Networks
Key market driver:
- Although bus and railway services are recognised as having the least harmful environmental impact compared to other forms of transport, there is still a desire in the industry to implement alternative fuel sources. A key driver comes in the form of significant subsidy from the UK government which has committed £23m to develop hydrogen ‘transport hubs’ and aid some of the projects listed below. Notwithstanding the eco-benefits, rail and bus companies will look to such funding to boost not only the local area being served, but also the wider acceptance of the use of hydrogen in public transport.
- Hydrogen public transport hubs have been receiving significant investment in recent months. Aberdeen City Council and BP in March 2022 agreed to develop and operate the Aberdeen Hydrogen Hub: a green hydrogen production and refuelling facility which will produce enough hydrogen to fuel 25 buses per day.
- In June 2022, the national bus operator StageCoach North East, in partnership with engineering consultants Ricardo, retro-fitted a diesel powered bus with hydrogen fuel cell technology for half the cost of a new bus. Cost-effective innovations are critical in expanding hydrogen’s role in the public transport network.
- The UK government announced that by 2023 hydrogen technology would be available to retrofit current in-service trains. The HydroFLEX railway project has been conducting trials on the first hydrogen-powered train to run on the UK’s main railway lines. Deployment of hydrogen has been further boosted by the fact that it is not necessary to overhaul the track network (for example, through expensive electrification of tracks), which can lower deployment costs and be especially beneficial for rural areas where there are more miles to cover but fewer passengers to justify the expense.
Key market driver:
- Analysis has shown that hydrogen cars are far quicker to refuel than EVs are to charge, and with a range of at least 300 miles they are comparable in the distance they can cover on one tank/charge. However, with an extremely limited number of hydrogen refuelling stations across the UK, there would need to be a substantial investment to make hydrogen powered cars viable to the consumer – funds perhaps better used on electrical charging stations.
This is undoubtedly the most difficult sector for hydrogen to break the electrification mould. The major challenge faced by hydrogen powered vehicles is the complexity and cost efficiency when compared to EVs. The energy required in the hydrogen supply chain to generate, transport, store, supply and reconvert to electricity equates to nearly four times that required for a standard electric vehicle.
- These challenges haven’t stopped car manufacturers such as Toyota and BMW from investing in hydrogen vehicles. Hyundai has also announced that it plans to roll out 500,000 hydrogen powered vehicles by 2030.
Understanding the challenges that apply to the entire low carbon hydrogen for transport market
Despite the progress outlined above, low carbon hydrogen faces three major hurdles which will require significant investment, time and resources to overcome:
- Accessibility: There is a considerable lack of green hydrogen availability to the end- consumer. In aviation for example, developing the large-scale transport and infrastructure solutions required to supply airports with the necessary quantities of hydrogen to fuel aircraft is very much in its infancy. Similarly, ports and public transport terminals will require a nationwide roll-out of storage and transport networks for hydrogen.
- The availability of ‘green’ hydrogen: Achieving Net Zero emissions targets will require approximately 305 million tonnes of green hydrogen to be produced internationally every year. Currently, there is almost zero entering the market and the annual amount of all hydrogen types produced is just 87 million tonnes. To achieve these targets, there would need to be a compound average annual growth of 66% between now and 2030, and 23% between 2030 and 2050. To play its part, the UK government must expand investment into ongoing and future projects and increase national hydrogen targets.
- Risk: As discussed in our recent article on the challenges for insurers that EVs will create, hydrogen will throw up a similarly difficult relationship with risk. Hydrogen’s flammability and the lack of widespread expertise (in the case of a repair) mean that insurers may be unable to use their own petroleum-based safety networks or in many cases they may be unwilling to provide hydrogen insurance without significant financial outlay from the hydrogen end-user.
Innovation abounds; nevertheless, the use of hydrogen in transport remains an area where there are many risks to manage and challenges to overcome. However, the pressing need to decarbonise transport requires urgent action, and since hydrogen could have a major part to play, it’s vital to consider all the opportunities and threats now, in order to find a viable route to deployment.
This two-part overview of the hydrogen’s role in the transport sector is part of a series of Clyde & Co articles exploring how hydrogen can be developed and implemented across the sector in the UK. You can read Part I here.