Japan and South Korea are set to become the major hydrogen importers in Asia, with a projected combined hydrogen demand of 33 million tonnes per year by 2050, according to a new report by the International Chamber of Shipping (ICS).

With dense populations, high energy-intensive industries and high dependence on fossil fuel energy sources, the countries have voiced their strong interest in adopting hydrogen as a future fuel source.

The Turning Hydrogen Demand Into Reality: Which Sectors Come First report, released in collaboration with Professor Stefan Ulreich, chair of the Task Force Renewables of Energy Traders Europe, notes that maritime shipping is the only suitable logistics option to import H2 inter-regionally from Africa, Australia, Latin America and the Middle East. Yet, to address the energy trilemma of supply security, affordability, and sustainability, the two nations must first overcome some challenges.  

At present, the expectation is that significant growth on the consumption side will occur between 2030 and 2050, with applications in transport being one of the last to mature. 

Asian demand centres
The report forecasts meeting the estimated combined H2 demand in Japan and South Korea in 2050, would lead to unprecedented electricity consumption – over six times the current renewable power generation. It estimates an electricity demand of 1,221 terawatt-hours and 383 gigawatts of electrolyser capacity. Further infrastructure requirements include 457 vessels with a capacity of 10,000 tonnes and 10 hydrogen terminals.  

South Korea aims to produce 5 million tonnes per year of hydrogen – 3m t/y of renewable and 2m t/y of low-carbon hydrogen – by 2050, and import 23m t/y. The country is targeting a strong increase in hydrogen usage by 2040, expanding its market from the current 130,000 t/y to 5.26m t/y. 

“Japan is expected to be the second-largest demand market for hydrogen imports, second only to South Korea,” ICS notes. The country’s Basic Hydrogen Strategy issued in 2017 sets an expansion of its hydrogen economy from the current 2m t/y to 3m t/y by 2030 and over 20m t/y of demand by 2050. Yet, it can only supply about 4m t of hydrogen to its consumers, the report says.

“Importing hydrogen will increase the available amount of hydrogen to Japanese consumers by up to 21m t, depending on global market price,” the report states, adding that importing hydrogen is cheaper than producing it domestically. 

Infrastructure – a challenging enabler
Maritime shipping and infrastructure will be a key enabler of hydrogen demand growth and international hydrogen market development. The ICS highlights that global hydrogen trading is safer and more flexible through maritime shipping, rather than pipelines. And that’s particularly the case for South Korea and Japan.

Ulreich, who is also a professor of energy economics at Bilberach University of Applied Sciences, tells Kallanish that there are currently several challenges in transporting hydrogen or its derivatives to these countries, starting with port infrastructure for loading/unloading the fuel and the vessels itself. 

Though there currently is a market and mature infrastructure for ammonia and methanol seaborne trade, the same can’t be said for hydrogen. “A typical hydrogen vessel is not yet available but planned,” the report notes, referring to plans for ships carrying liquefied hydrogen with 40,000-cubic-metre (m3) and even 160,000-m3 loads. The latter would be able to carry 10,000 t of hydrogen, which ICS says corresponds to around 0.33 TWh.

A typical ammonia vessel can load about 0.30 TWh and a typical methanol vessel can load about 0.21 TWh in terms of energy, the report calculates. 

With different physical properties and energy densities, the number of voyages and ships needed to transport liquefied hydrogen, liquid ammonia and methanol via vessels vary. 

Hydrogen has a much lower energy density than ammonia and methanol. This means that within the same storage space, nine times more ammonia can be stored than hydrogen. However, hydrogen is more efficient in energy generation than ammonia, likely offsetting its inefficiency in low density and ending up with similar energy transport efficiency with ammonia, the ICS says. 

It is worth noting that all calculations are theoretical and assume no waste or damage on voyages. 

Under standard conditions, ammonia has a density of 0.73 kilograms/m3, methanol of 792 kg/m3, and hydrogen of 0.084 kg/m3. However, hydrogen’s heating value (energy density per unit mass of fuel) is much higher at 33.3 kilowatt-hours/kg whilst about 5.3 kWh/kg for ammonia and 4.3 kWh/kg for methanol.

The report finds that hydrogen shipping (standard vessel 10,000 t) is less efficient than methanol (standard vessel 50,000 t) and ammonia (standard vessel 57,120 t). For hydrogen carrier vessels to transport 1 million tonnes of hydrogen, it requires 100 voyages, 5,000 voyage days per year, and about 14 ships.

For the transport of 1m t of methanol, ICS estimates 20 voyages, 1,000 voyage days per year, and about three ships. For ammonia vessels, to transport the same amount of ammonia, only 18 voyages are required, 875 voyage days per year, and three ships. 

Currently, in Japan, Suiso Energy is leading the liquefied hydrogen supply chain commercialisation demonstration project as part of the large-scale hydrogen supply chain establishment. This project, centred at Ohgishima, Kawasaki, aims to supply 1m t of hydrogen in 2030 and reach a 55m t global trade volume in 2050. It also aims to reach cost targets of JPY 30/m3 in 2030 and JPY 20 in 2050 through infrastructure refinery and innovative hydrogen transportation technology - using liquefied hydrogen and methylcyclohexane (MCH) as a hydrogen carrier. 

In South Korea, the second largest shipbuilding country after China, Hyundai Heavy Industries Group’s subsidiary Korea Shipbuilding & Offshore Engineering (KSOE) announced it expects itself to have the technology to transport hydrogen by ship by 2025 and realise commercialisation in 2025-2027.

Shipping, which transports about 90% of world trade and accounts for nearly 3% of the world’s CO2 emissions, is under growing pressure to deliver more concrete decarbonisation action.

Industry regulators say the first net-zero ships must enter the global fleet by 2030, and ships powered by green hydrogen could help meet that target.

“There are currently no ‘best’ solutions, but importers still try to find out what technology is best from a safety, cost, scaling-up perspective – and of course also, what is the ideal fuel to be transported depending on customers demand,” says Ulreich. 

Japan, for example, follows a very technology-open approach, the professor adds. “There is no single bet on hydrogen alone, but also energy carriers based on hydrogen are considered – such as ammonia, methylcyclohexane (MCH) and methane. Each of these energy carriers has its advantages and disadvantages – so far it is not clear, what will be the winning energy carrier and even, if there will be a winning energy carrier,” he concludes.

Maritime Shipping Efficiency Comparison for Ammonia, Methanol, and Hydrogen

Source: International Chamber of Shipping