H2Terminals Limited and the London P&I Club have recently signed a Memorandum of Understanding (MoU) aimed at developing insurance solutions for green hydrogen shipping.
This partnership is touted as a significant leap towards integrating liquid hydrogen into the UK’s maritime sector. However, while the MoU marks a noteworthy collaboration, it is crucial to critically evaluate whether this initiative genuinely represents a transformative advancement or if it falls short of the industry’s evolving standards.
H2Terminals’ plan involves offshore production of green hydrogen at a site known as Energy Island, located 100 kilometers from shore. The envisioned process includes harnessing renewable energy from wind, sun, and waves, followed by electrolysis and liquefaction of hydrogen.
While the scale of this initiative is ambitious, it brings with it a host of practical challenges. Offshore facilities of this magnitude require substantial infrastructure and maintenance, and the technological feasibility of continuously operating such a remote and extensive setup remains to be fully demonstrated. Additionally, the integration of advanced LH2 carriers and power barges for distribution introduces complexities that could potentially impact the project’s viability.
The London P&I Club’s role in developing tailored insurance solutions for H2Terminals’ hydrogen-powered vessels and storage systems highlights the need for specialized coverage in this nascent field. However, this collaboration also underscores the uncertainty surrounding the insurability of new hydrogen technologies.
While the London P&I Club’s involvement suggests an effort to mitigate risks, the effectiveness of these insurance solutions in addressing the unique challenges of hydrogen transport is yet to be proven. The risk landscape for green hydrogen remains largely uncharted, and the actual performance of these insurance solutions will need rigorous evaluation against real-world scenarios.
The advanced technologies proposed by H2Terminals, including 50-ton liquid hydrogen storage spheres and hydrogen fuel cell-powered carriers, represent significant technological strides. Nonetheless, these innovations are still in the early stages of adoption, and their long-term reliability and safety have yet to be thoroughly tested in operational conditions.
