Logistics for a Low-Carbon Economy: Hydrogen and Ammonia Distribution. Opportunities and Challenges

This article originally appeared in "Infrastructure Grids and Networks: The Challenges Ahead, amid Security and Efficiency", with the knowledge partnership of McKinsey & Company. 

Clean hydrogen is emerging as a key energy carrier in the transition to a low-carbon economy. However, its large-scale distribution presents significant logistical challenges. Multiple transportation methods are available, ranging from pipelines and liquefaction to conversion into carriers such as ammonia, each with distinct advantages and trade-offs. The optimal distribution approach will depend on factors such as distance, existing infrastructure and specific end-use applications. While pipelines offer an efficient solution for regional distribution, liquefied hydrogen enables long-distance transport, but at much higher energy costs. Alternatively, hydrogen can be converted into ammonia, facilitating storage and global shipping due to its higher volumetric energy density and mature global infrastructure. Given the diverse needs of a global hydrogen economy, a hybrid approach that leverages a combination of these methods will likely be necessary to enable cost-effective, scalable and sustainable hydrogen distribution. This chapter outlines the strategic priorities for scaling hydrogen supply chains, emphasising innovation, coordinated investment and effective policy frameworks.

The remainder of this chapter is structured as follows: Section 2 reviews the technology landscape and evolving market dynamics. Section 3 analyses hydrogen logistics options, focusing on pipelines, liquefied hydrogen and ammonia. Section 4 outlines key strategies related to innovation, policy and market development. Continue reading the full article