According to a research conducted by Ricardo and the Environmental Defense Fund for the P4G Getting to Zero Coalition Partnership, South Africa has an untapped opportunity to deliver zero carbon fuels to the global maritime industry.
The development of green hydrogen-derived fuels can contribute to the country’s decarbonization goals and function as a catalyst for economic growth by expanding export markets, facilitating an equitable transition, and creating future jobs. The study examines the economic and environmental benefits of using zero-carbon shipping fuels in South Africa’s shipping sector.
International maritime transport is on the eve of a revolution in terms of energy consumption. To reach decarbonization ambitions, the shipping sector must begin replacing existing heavy bunker fuel with new zero-carbon shipping fuels supplied from renewable energy over the next decade. South Africa has an abundance of renewable energy resources and has committed to achieving 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 122 and 175 billion Rand 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.
South Africa’s geographical location and economic development make it particularly well-suited to supply zero-carbon fuels to the country’s marine sector and export to worldwide markets, the report concludes.
“South Africa has the opportunity 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 generalization 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.
Numerous zero-carbon fuels may be utilized in transport. Due to South Africa’s availability of renewable energy resources, shipping fuels can be obtained 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.
Adoption of zero-carbon shipping fuels is contingent upon worldwide market demands. South Africa should look globally to ensure the effective use of zero carbon shipping fuels. Vessels bunkering with zero carbon fuels in a variety of ports across the world must have the option to refill along the way.
“The transition to a zero emission future is for and about people. Achieving an inclusive, globally scalable transition requires a systems-oriented, transparent approach. This requires standards to be set by the maritime industry to encourage the zero carbon transition not only for vessels but for global ports. South Africa can be a part of driving international standards as an important player in the international shipping sector and as a pioneer in zero carbon fuels,” says Margi Van Gogh, Head of Supply Chain & Transport, The World Economic Forum.
Adopting zero carbon shipping fuels has tremendous benefits and synergies for South Africa that extend well beyond the shipping industry, and is consistent with the country’s objective to achieve net zero carbon emissions by 2050.
Zero carbon fuels might also be employed in broader industries such as fertilizer and steel production, acting as a catalyst for South Africa to meet its total carbon reduction targets. There is the potential to create a diverse range of jobs within zero carbon fuel supply chains, thereby assisting South Africa’s just and equitable transition away from coal mining and coal-based energy generation.
The research mentions Saldanha Bay, Ngqura (Coega), and Richards Bay ports as excellent examples of how South Africa can benefit from a zero carbon fuel transition due to existing shipping routes and important port export centers.
“Zero carbon shipping presents South Africa with the opportunity to usher in “a new economy in a new global reality”, to quote President Ramaphosa in our national Economic Reconstruction and Recovery Plan. For this, the SBIDZ supports this research in its efforts to stimulate solutions and investment into a global megatrend that is becoming the agenda of our time. It will require sustainable capital investment into new technologies, new vessel designs, new landside infrastructure and a shake-up of the services and logistics sub-sectors. This is exactly the work the SBIDZ is vested in as a catalyst for economic growth and transformation, and the unique potential of the Port of Saldanha Bay as the first Freeport in South Africa,” says Kaashifah Beukes, Chief Executive Officer, Saldanha Bay Industrial Development Zone.
