Study identifies S. Africa’s potential to supply zero-carbon fuels
South Africa holds an untapped opportunity to supply the global shipping industry with zero-carbon fuels, according to a study by Ricardo and the Environmental Defense Fund for the P4G Getting to Zero Coalition Partnership. The production of green hydrogen-derived fuels can help to meet decarbonization targets and act as a catalyst for the country’s economy by opening new export markets. The study explores the economic and environmental potential for implementing zero carbon shipping fuels through the shipping sector of South Africa.
International maritime transport is on the verge of an energy revolution. Within this decade, the shipping industry must replace traditional heavy bunker fuel with new zero-carbon shipping fuels generated from renewable energy to meet decarbonization targets. South Africa has vast renewable energy sources, and the country has committed to reach net zero emissions by 2050.
“Our study shows that South Africa has an abundance of renewable energy potential. It is enough to supply the country’s domestic electrical demand as well as the production of zero carbon fuels to supply commercial vessels refueling in its international ports. The adoption of zero-carbon propulsion technologies at South Africa’s ports could attract investment of between ZAR122 billion (USD8.5 billion) and ZAR175 billion (USD12.3 billion) in onshore infrastructure by 2030. All that is needed to unlock this investment is the right policy incentives set at the International Maritime Organization,” says Aoife O’Leary, director, International Climate, Environmental Defense Fund.
The report finds that South Africa’s geographical location and economic development make it particularly well suited to distribute zero-carbon fuels for the South African shipping sector, and export to international markets.
“South Africa has the opportunity to feed into the growing global demand for decarbonized materials, products and services by offering bunkering capability for zero-carbon fuels to vessels of all types. With access to busy shipping routes, abundant renewable energy potential, and experience handling these and other fuels, South Africa is in a great position to produce the shipping fuels of the future, access a growing global market, and thus catalyze a new low carbon economy,” says Olivia Carpenter-Lomax, future energy specialist and project lead, Ricardo.
“It is easy to make a generalisation that many developing countries are positioned to gain from a future hydrogen economy and hydrogen derived fuel use in shipping. This report goes into the important specifics of that opportunity for South Africa and finds not just why this is necessary, but the numerous reasons to be optimistic and seek to accelerate progress towards this future,” says Tristan Smith, reader in Energy and Shipping, University College London.
Several zero-carbon fuels can potentially be used in shipping. The abundance of renewable energy resource in South Africa means that shipping fuels can be derived from renewable electricity generation.
“The report identifies hydrogen and ammonia as the most suitable options for large commercial vessels while South Africa’s small domestic vessels can be supplied through direct electrification using onboard batteries and motors. Shipping’s demand for zero-carbon fuels could provide a constant long-term revenue stream, which is an attractive feature for investment,” says Ingrid Sidenvall Jegou, project director, Global Maritime Forum.
The adoption of zero-carbon shipping fuels depends on global market requirements. In order for a successful adoption of zero-carbon shipping fuels, South Africa should look globally. Vessels adopting zero-carbon fuels bunkering in various ports around the world must refuel along their journey.
Adopting zero-carbon shipping fuels has significant benefits and synergies for South Africa far beyond the shipping sector and is in line with South Africa’s commitment to reach net zero carbon by 2050. Zero-carbon fuels may also be used in wider industries such as fertilizer and steel production and could act as a catalyst to achieving South Africa’s overall carbon commitments. There is the potential to create a wide range of jobs within the supply chains of zero-carbon fuels, which can support South Africa’s just and equitable transition as available jobs in coal mining and coal-based electricity generation decline.
The report highlights the ports of Saldanha Bay, Ngqura (Coega) and Richards Bay as great examples of how South Africa can capitalize on a zero-carbon fuel transition due to established shipping routes and significant port export hubs.