Grey hydrogen can be used in heavy-duty vehicles in EU’s fossil fuel phase-out, despite being as polluting as diesel

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Rules forcing EU truck and bus manufacturers to produce zero-emissions vehicles (ZEVs) as part of a fossil-fuel phase-out in the transport sector could be undermined by a loophole that allows grey hydrogen to be used, even though it can be more polluting than diesel, Hydrogen Insight has learned.

The new Heavy Duty Vehicle Standard (HDVS) rules, agreed by the European Commission (EC) but not yet finalised, envisages auto manufacturers reducing the total emissions from the heavy-duty vehicles they produce, starting with a 45% reduction in 2030 compared to 2019, 65% by 2035 and 90% by 2040.

To meet the targets, truck and bus manufacturers would need to be producing enough ZEVS to correspond to the emissions reductions, fitted with technology such as batteries, hydrogen fuel cells or hydrogen internal combustion engines.

The remaining 10% of emissions not covered by 2040 would be reserved for segments that are extremely hard to decarbonise, such as vehicles used in forestry or agriculture, so in practice, auto makers are likely to be producing close to 100% of trucks and buses with ZEV technology by 2040.

But as the rules do not hold manufacturers liable for the lifetime emissions of the fuel ultimately used in the vehicle — only the tailpipe emissions calculated via a range of criteria including driving patterns and component performance — this means that ZEVs can run on grey hydrogen made from fossil fuels and still count towards a fossil fuel phase-out.

“The responsibility of meeting the targets under HDV Standards legislation falls on manufacturers,” a spokesperson for the EU told Hydrogen Insight. “It will be for them to decide which technologies they use to achieve these targets, eg electrification, hydrogen fuel cells or hydrogen in internal combustion vehicles.

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“[Grey hydrogen use will be allowed] because the tailpipe CO2 emissions of a hydrogen fuel cell vehicle are zero, regardless of the origin of the H2 fuel.”

Based on data from the International Energy Agency (IEA) and the UK’s forestry research agency, grey H2 made with gas through steam methane reformation has a lifecycle emissions intensity of between 0.23kg and 0.33kg of CO2/kWh, compared to 0.27kg/kWh for diesel, according to Hydrogen Insight’s calculations.

This means that a vehicle running on grey hydrogen in the name of the EU’s fossil-fuel phase-out could be more polluting than diesel, depending on the upstream emissions intensity.

The bloc is regulating fuel emissions separately, both via its cap-and-trade carbon market, the Emissions Trading System (ETS) and the newly minted Renewable Energy Directive (RED III), which the European Commission told Hydrogen Insight would “make sure that the hydrogen used is progressively decarbonised”.

However it is not clear how this will be achieved, as in each case the targets do not align with those outlined in the heavy-duty vehicle targets — potentially allowing grey hydrogen use as a fuel.

The new “ETS 2”, which specifically covers emissions from buildings and road transport, caps emissions from fuel sold by suppliers at 42% by 2030 compared to 2005 emissions (unlike the heavy-duty vehicle standard for which 2019 is the base year). However, as yet, there is no target beyond 2030.

Additionally, the cap-and-trade nature of the targets means that in the event that there is not enough low carbon hydrogen, fuel suppliers could sell grey H2 anyway, and pay for EU carbon allowances to account for the extra emissions.

The effect that RED III will have on the use of grey H2 is even more opaque. Rather than target emissions reduction, the legislation mandates an increase in the share of renewables in primary energy consumption of 42.5% by 2030 (as part of the EU’s overall emissions reduction target of 55% by 2030), with transport expected to contribute either with a 29% share of renewable energy, including electricity, or a greenhouse gas intensity reduction (rather than real emissions reduction) of at least 14.5%.

The hydrogen-specific mandate in RED III envisages just 1% of all fuel supplied to the transport sector, including maritime and aviation, to be Renewable Fuel of Non-Biological Origin (RFNBO) — the EU’s term for green hydrogen and its derivatives, such as ammonia or methanol — by 2030.

Both of these targets seem insufficient to ensure that green hydrogen is used in heavy duty trucking rather than polluting grey, negating some of the benefits of a fossil-fuel phase-out in the sector.

Ultimately, however, it will depend on how vehicle manufacturers choose to meet the HDVS targets, which will be determined by the needs of their customers. If there is an influx of hydrogen-powered buses and trucks, then it will be harder to find enough low-carbon hydrogen to meet the targets expected — especially without firmer targets for fuel suppliers — resulting in more grey hydrogen use.



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