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Renewable hydrogen and synthetic fuels versus fossil fuels for trucking, shipping and aviation: A holistic cost model

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  • Martin, Jonas
  • Neumann, Anne
  • Ødegård, Anders

Abstract

Potential carbon neutrality of the global trucking, shipping and aviation sectors by 2050 could be achieved by substituting fossil fuels with renewable hydrogen and synthetic fuels. To investigate the economic impact of fuel substitution over time, a holistic cost model is developed and applied to three case studies in Norway, an early adopter of carbon-neutral freight transport. The model covers the value chains from local electricity and fuel production (hydrogen, ammonia, Fischer–Tropsch e-fuel) to fuel consumption for long-haul trucking, short-sea shipping and mid-haul aviation. The estimates are internally consistent and allow cross-mode and cross-fuel comparisons that set this work apart from previous studies more narrowly focused on a given transport mode or fuel. The model contains 150 techno-economic parameters to identify which components along the value chains drive levelized costs. This paper finds a cost reduction potential for renewable fuels of 41% to 68% until 2050, but carbon-neutral transport will suffer asymmetric cost disadvantages. Fuel substitution is most expensive in short-sea shipping, followed by mid-haul aviation and long-haul trucking. Cost developments of electricity, direct air capture of carbon, vehicle expenses, and fuel-related payload losses are significant drivers.

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  • Martin, Jonas & Neumann, Anne & Ødegård, Anders, 2023. "Renewable hydrogen and synthetic fuels versus fossil fuels for trucking, shipping and aviation: A holistic cost model," Renewable and Sustainable Energy Reviews, Elsevier, vol. 186(C).
    • Handle: RePEc:eee:rensus:v:186:y:2023:i:c:s136403212300494x
    DOI: 10.1016/j.rser.2023.113637
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