Harnessing Clean Hydrogen Mobility: Opportunities and Challenges
This article originally appeared in "Logistics in Transition: Exploring Geopolitical, Economic, and Technological Trends", with the knowledge partnership of McKinsey & Company.
The global transition to a low-carbon economy and adopting the needed clean energy technologies at scale will significantly impact existing value chains1 and transform production-to-consumption lifecycles. Regulatory and business models must rapidly evolve to manage the resulting substantial cost challenges and dramatic shifts in stakeholder interactions while continuing to create value.
While hydrogen has long been a staple in the energy and chemical sectors, the emergence of clean hydrogen2 is poised to be a game-changer in the world’s transition toward a carbon-free future. Its adoption at scale holds the key to decarbonizing energy-intensive industrial processes, such as steel and cement production, whose emissions are hard to abate. However, to take advantage of the associated economic opportunities, stakeholders must rethink their roles in a new energy landscape and define strategic industrial policies accordingly.
As both public and private stakeholders become increasingly committed to addressing climate change, they are also placing greater emphasis on the deep decarbonization of mobility in sectors such as aviation, shipping, rail, and long-distance road transportation. Areas were shifting to electricity as the preferred energy vector while decarbonizing its production may not be immediately feasible. At the same time, the adoption of clean hydrogen will depend on more than just its environmental benefits; economic, policy, technological, and safety factors must also be addressed.
Overall, transportation is the second-largest producer of global carbon dioxide (CO2) emissions, after electricity and heat generation (see Figure 5.1) and one of the most challenging sectors to decarbonize due to its distributed nature and the advantages provided by fossil fuels in terms of high energy densities, ease of transportation and storage. Greenhouse gas emissions from transportation primarily come from burning fossil fuel in cars, trucks, ships, trains, and planes. Globally, over 94% of transportation fuels (gasoline, diesel, and jet kerosene) are petroleum-based. Continue reading the full article.