Holistic lifecycle investigation of alternative fuel - hydrogen

• Main Author: Ho, Aaron Hui Man
• Other Authors: Chiu Sai Hoi, Benson
• Format: Final Year Project
• Language: English
• Published: Nanyang Technological University 2022
• Subjects: Engineering::Maritime studies
• Online Access: https://hdl.handle.net/10356/163417
• Institution: Nanyang Technological University

The shipping industry facilitates movement of huge amounts of cargoes at the most cost-effective manner when compared to other modes of freight transport. The industry experienced changes in the principal energy sources throughout the past few centuries, where developments are driven by a steady stream of technological advancement. Due to its many benefits, heavy fuel oil (HFO) has since 1970 been the fuel of choice for the maritime sector because of numerous improvements to the diesel engine. However, the continued use of fossil fuels is a concern in terms of sustainability. In 2050, it is anticipated that the production of greenhouse gases (GHG), mainly CO2, will increase by 50% to 250%. MEPC 72 adopted the "Initial IMO Strategy on Reduction of GHG Emissions from Ships" in 2018 with requests of specifically aligning with the Paris Agreement, aiming to reduce overall annual GHG emission by at least 50% relative to GHG level in 2008 by 2050. In shipping industry, there are several potential alternative fuels that may accomplish the radical reduction in CO2 emissions required to achieve the IMO's target in 2050. This paper seeks to investigate the hydrogen life cycle as an alternative fuel holistically by assessing the economic viability of the maritime industry’s adoption. To ensure consistency and reliability of results, primary and secondary data were gathered to gain a better understanding on the cost-competitiveness of hydrogen. The primary data consisted of interviews with various members employed in different areas of the maritime industry, while the secondary data consisted of literature from various sources that served as cross references. The interviewees are Mr Josiah Eng from Siemens Energy, Mr Tsuyoshi Yuri and Mr Seokho Yoon from Mitsui O.S.K Lines (MOL), and Mr Samuel Lee from PSA. Upon analysis of the data, the study revealed several economic considerations that the maritime industry could undertake. The considerations include comparing the economic benefits of importing hydrogen from other nations against producing hydrogen locally. The study also identified challenges, opportunities for adopting hydrogen in mid and long term. Some challenges include the high price of producing and transporting hydrogen, the lack of infrastructure for hydrogen to be imported, and identifying the offtakers who will undertake the cost of hydrogen after being adopted in the maritime industry. However, the study also found various opportunities where hydrogen has enormous potential for decarbonizing the energy mix. Hydrogen may eventually overtake and could be the preferred choice of alternative fuel in the maritime industry in 2050. Production costs will decline over time because of continuously declining costs for producing renewable energy, economies of scale, lessons learned from current projects, and technology advancements. Green hydrogen will consequently become more affordable. For the maritime industry to step up and adopt hydrogen as an alternative fuel in the maritime industry, the author has mentioned the necessity for investing, alignment of policies, and market creation and provided recommendations on what is required of the government, businesses, and consumers to guide the maritime industry towards adopting hydrogen economically by 2050.