News / Green hydrogen fuel getting cheaper at port of Rotterdam

According to at least one measure, the cost of green hydrogen at the port of Rotterdam has come down to the extent that it is, at times, cheaper than grey – an encouraging development for the adoption of green fuels.

Green hydrogen is generated using renewable energy, like wind and solar, combined with seawater electrolysis, and is the only variant of hydrogen beneficial for decarbonisation.

Grey hydrogen is made using steam-reforming from fossil fuels, a refining process which incurs such egregious carbon emissions that adopting it for vehicle fuel would accelerate climate change.

The port notes that both became cheaper over the course of last year, but now it appears the cost spread between the two has narrowed to such an extent that green is periodically cheaper than grey.

This is a positive sign for the various next-generation marine fuels, including green ammonia and green methanol, which use green hydrogen as a precursor. But concern is widespread that not enough green hydrogen can be provided to support shipping’s transition to these new fuels.

“It still depends strongly on the weather; when a lot of wind and solar energy is being generated, green electricity and green hydrogen can be cheaper than grey,” said the port yesterday. “At other times, however, it may be more expensive.”

The variability of renewable energy is one of its main barriers. Periods of high wind and of high electricity demand rarely coincide, meaning that either perfectly good wind energy is ‘curtailed’ (ie, wasted), or electricity grids must work exceptionally hard to adjust to these moment-to-moment peaks and troughs. In 2022, for example, Scotland generated 27.5TWh of wind energy, but some 4TWh was curtailed.

Green hydrogen has been considered one possible response to this – using excess power in electrolysers to generate virtually free hydrogen, and relieving the pressure on national grids, a strategy known as ‘peak shaving’. If the principle can be mastered in practice, both cheap hydrogen and highly cost-efficient renewable energy installations will result.