Photo: Liquefied Hydrogen bunker vessel; Image credit: Wilhelmsen

Industry groups tell EU to incentivize green hydrogen and ammonia as fuels of the future

The EU should promote the use of green hydrogen and ammonia by ships as part of its upcoming maritime fuel law, major shipping industry players and environmentalists have told the European Commission.

The new law, better known as the FuelEU Maritime initiative, will require ships carrying EU trade to progressively switch to sustainable alternative fuels.

In a letter published today, shipping companies DFDS, CMB and Viking Cruises, commodities trader Trafigura, and green group Transport & Environment (T&E) said green hydrogen and ammonia are sustainable and can be produced in sufficient quantities to decarbonise the industry.

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Biofuels, on the other hand, do not offer a sustainable alternative for shipping, the groups say, as crop-based biofuels emit more than the fossil fuels they replace and there will not be enough advanced biofuels.

As a result, the letter signatories called on the European Commission to stimulate the deployment of green hydrogen and ammonia for shipping within the initiative.

“Unlike advanced biofuels, green hydrogen and ammonia can be scaled to meet the energy demand of the global industry. And even the largest ships can be powered by these fuels. It is high time that European Commission changes the focus from ‘quick and dirty’ biofuels to truly sustainable alternatives,” Faïg Abbasov, shipping programme director at T&E, said.

However, these fuels are very expensive compared to fossil fuels, but production costs can be reduced with economies of scale.

Globally, €1.4 trillion in capital investments will be required to produce green hydrogen and ammonia for the shipping industry. The European Commission should seize this opportunity to create new jobs and support sustainable economic growth – in line with the EU Green Deal, the groups say.

“To justify large investments in electrolysers and ammonia plants, European maritime fuel policy needs to send a clear demand signal for the potential investors by focusing on these green fuels and their
relevant propulsion technologies,”
the letter reads.

The European Commission is scheduled to propose its FuelEU Maritime Initiative in April.