Houston-based Exxon Mobil and fertilizer-maker CF Industries are partnering to make “blue” ammonia, a product the companies said could play an important role in decarbonizing industrial facilities such as refineries, petrochemical plants and power generators.
CF Industries, headquartered in suburban Chicago, said it will develop a $200 million carbon capture unit at its nitrogen facility south of Baton Rouge. Exxon will then, through a deal with pipeline company EnLink, move the carbon dioxide to Exxon’s geologic storage facility in Western Louisiana. The project is expected to be operational in early 2025.
Exxon said carbon capture projects are gaining new momentum because of incentives included in the Inflation Reduction Act signed into law in August. The oil major aims to make a name for itself in the carbon capture and management space, offering the services to facilities in Texas and Louisiana that are looking to slash their emissions.
“Exxon Mobil is providing a critical and scalable solution to reduce CO2 emissions,” Exxon’s Low Carbon Solutions President Dan Ammann said, “and we’re ready to offer the same service to other large industrial customers in the state of Louisiana and around the world.”
Through its new partnership with Exxon, CF Industries will capture 2 million metric tons of carbon dioxide from its Donaldsonville, La., facility that would otherwise be released into the air around its facility, the company said. Exxon says the carbon reduction is equal to replacing 700,000 gasoline-powered cars with electric vehicles.
Capturing the carbon created in its manufacturing process will enable CF Industries to market nearly 2 million metric tons per year of “blue” ammonia, the term used for products made with carbon capture technology that catches and stashes away emissions made during manufacturing.
Carbon-neutral ammonia, in particular, could play an important role in decarbonizing industrial facilities such as refineries, petrochemical facilities and power generation plants, the companies said. It can be used both as a fuel itself or as a way to make hydrogen fuels.
“CF Industries will be first-to-market with a significant volume of blue ammonia,” said CF Industries CEO Tony Will. “This will enable us to supply this low-carbon energy source to hard-to-abate industries that increasingly view it as critical to their own decarbonization goals.”
In such uncertain times, there are few economic sectors that are a 100% sure bet for investors – but energy storage certainly seems to be one of them. As the world leans more earnestly toward decarbonization and the United Nations and the Intergovernmental Panel on Climate Change sound a “code red for humanity” as the window of opportunity to avoid the worst impacts of global warming rapidly closes, energy storage has become one of the fastest-growing industries as demand for clean energy heats up.
The global energy storage market is on track to hit one terawatt hour by 2030, a quantity that would mark a more-than 20-fold increase over the already groundbreaking 17 gigawatts/34 gigawatt-hours that were online at the end of 2020. “Overall investment in battery storage increased by almost 40% in 2020, to USD 5.5 billion,” the International Energy Agency (IEA) reported at the end of last year.
“The global storage market is growing at an unprecedented pace. Falling battery costs and surging renewables penetration make energy storage a compelling flexible resource in many power systems,” says Yiyi Zhou, a clean power specialist at Bloomberg BNEF. “Energy storage projects are growing in scale, increasing in dispatch duration, and are increasingly paired with renewables.”
The breakneck increase in storage capacity is largely being driven by China and the United States, which are currently embroiled in a quietly simmering energy storage war. Each of these countries added gigawatt-scale additions of energy storage capacity in 2020. Together, China and the U.S. represent more than half of the global energy storage market projections for 2030.
China is currently winning the race, having more than doubled its energy storage capacity additions in 2020. What’s more, in July of last year, Beijing announced that it is planning to install 10 times more capacity than its 2020 levels by just 2025.
Now, a new plan released this year shows that China aims to achieve this breakneck pace for energy storage addition by butting the cost of electrochemical energy storage systems by 30% by 2025. The 5-year plan released by the National Development and Reform Commission and the National Energy Administration also outlines the complete commercialization of non-hydro energy storage systems by 2030. “The country will seek breakthroughs in long-duration storage technologies such as compressed air, hydrogen, and thermal energy, and aim for self-reliance in key fields,” Bloomberg reports.
“It will conduct pilot programs using various technologies to meet different storage duration requirements, lasting from minutes to months.”
The ramping up of non-hydro energy storage capacity installation will take place in tandem with the expansion of wind and solar capacity development, which is to be built out at a massive scale in China’s desert regions. This will help China achieve its goal of weaning itself off of foreign energy imports and shore up Beijing’s energy security and energy independence.
Long-term energy storage will allow energy produced in China’s sparsely populated deserts to be piped into the country’s massive and energy-hungry urban areas. “The country will also explore storage technologies for power produced by offshore wind farms, so as to reduce transmission capacity needs and improve the utilization rate of the electricity generated,” says Bloomberg.
As straightforward and promising as these plans may be, Beijing’s ambitious plans for clean energy development and increased investment in energy storage are coming at a time when China’s economy is in trouble.
Current Covid lockdowns in the affluent economic hub of Shanghai are costing the country a stunning $4.6 billion USD a month, amounting to about 3% of the nation’s GDP. The country’s “zero-Covid” approach is being derided as a “fiasco” as 62 million Shanghai-area residents (a group larger than the population of Italy) are being locked into their homes and locked out of the economy.
If President Xi Jinping continues to try to outgun the novel coronavirus instead of adapting to mitigate and coexist with Covid, many of China’s most ambitious plans may prove to be out of reach.
The tank terminal market is very fragmented with more than a thousand terminal operators operating five thousand terminals worldwide (1). The global market leader Vopak owns just 5 percent of all tank terminals worldwide. Many smaller players are operating in and across niches. With increasing spot activity, vessel owners call many terminals that they are not familiar with. Each tank terminal now handles more vessels of different types and sizes than ever before (3). Buying and selling opportunities abound, but properly valuing a tank terminal has become a daunting task. So how do you determine the value of your tank terminal? In this article, we share 5 key indicators that will help you understand how much your tank terminal is worth.
Until some ten years ago tank terminal investments were exclusively the territory of industry players and private equity. Now increasingly pension and infrastructure funds are entering the market. With the yield on bonds approaching zero percent pension funds and insurance companies shift more of their capital allocations to riskier higher-yielding investment opportunities. And since typical core infrastructure investments like airports, ports, gas pipelines and toll roads are very competitive, tank terminals stand out as an interesting alternative (2) with a low-risk profile and stable revenue streams.
Countering this trend private equity firms are also becoming more creative to realize better returns on tank terminals. Some hire management teams from the storage industry to acquire and develop storage terminals for them, thereby turning a formerly distant investor into an active role of storage operators. Some have bought into existing storage companies with the same goal: turning hands-on experience and know-how into higher yields (2).
As an owner of a tank terminal one can profit from these trends because there are more buyers around plus investors looking for partnerships and acquiring strategic shares. This applies mostly to the independent operators, who have yet to position themselves in a nice market. Semi-captive players need to constantly reevaluate their proposition and be open to better partnerships. Fully captive sites are already vertically integrated in a branch of the industry so they will only be open to selling or investment when that industry is restructuring.
How to approach the valuation of your tank terminal
Before we look at the five factors
determining the value of your tank terminal, let’s describe three approaches
for valuation (4):
Income
approach
The income or discounted cash flow approach requires inputs on prospective financial information, single- or multi-period cash flows, rates of return and long-term growth, and exit multiples and terminal values. Potential challenges with this approach include the availability of projections, unobservable industry growth/risk benchmarks, and a high level of subjectivity. Potential benefits of this method include capturing the asset-specific growth trajectory and risk/reward profile and sidestepping the lack of comparability across peer groups. Limitations include input parameters that can be difficult to estimate and the possibility of yielding negative values for early-stage projects.
Market
approach
An alternative approach is looking at the general market of tank terminals and identifying similar transactions. Here we have for instance the so-called “cost of a comparable transaction” with the same reasoning as when a prospective home buyer checks out recent sales in a neighborhood. An alternative is the Guideline Public Company Method, which also looks for similarity but in this case of trading multiples of publicly traded companies that are similar to the subject company. However, pre-revenue companies lack a basis to apply meaningful multiples, and in general, there is a lack of comparability across peers due to differences in margin and cost structure, location, and the competitive landscape.
Cost
approach
These methods provide the estimated
replacement cost of an asset based on the current replacement cost minus the
cost of depreciation, including deductions for physical deterioration and all
relevant forms of obsolescence. Or they restate the individual assets and
liabilities on the balance sheet to fair value. This method is easy to understand,
but it fails to capture intangible assets like contracts, location, future
growth and goodwill value.
The 5 key factors that influence the value of your tank terminal
From the limitations of these technical valuation techniques, follows that we need a complementary, more intuitive, birds-eye view to get at a decent valuation. So let’s bring in five key factors that singly influence the value of your tank terminal.
1. Location
The most important factor determining the value of your tank terminal is its location on the map. In most cases the surrounding industries, position within transport and distribution networks, and regional supply and demand dynamics determine the demand for tank space. A tank terminal on a bad spot is like a hotel in a disaster zone. An example: after the collapse of the Soviet Union in a few years’ time many tank terminals sprang up in booming industry and trade zones in the Baltics. Since then, the new strong Russian government has been consolidating elsewhere, especially around St. Petersburg. The Baltic tanks became partly redundant and crashed in value of course.
2. Infrastructure
A second related factor is the infrastructure
of the tank terminal. A good location at the sea side is worthless without good
maritime infrastructure. Are there good rail connections? What kind of
pipelines are available or could be built? Do installations have security
valves? Are there adequate fire extinguishers? Is the terminal maintained well
enough and what’s the state of the equipment?
3. Business model
As outlined above, ever more diverse players are entering the market of tank terminals with varying business models for generating revenue. The employed or planned business model is the third factor determining the value of the tank terminal. We can discern four types of business models:
1/ An industrial terminal has low margins but a very stable business; In this setup, a tank terminal is located next to an industrial site. It is basically an outsourcing solution for the chemical site next door. All storage and logistical services are handled by the industrial terminal and the players on the chemical site pay a fee for that;
2/ A trade hub is a highly flexible set-up, mostly on prime locations and with bigger margins. Traders use the terminal to facilitate their arbitrage strategies. As such the terminal needs to be very flexible and responsive so that the trader can capture market opportunities. However, customers come and go and tanks quite often go empty for a while;
3/ an import or export terminal focuses on specific products entering and given clearance in a geographical area. Players in those regions need the terminal to either import products for consumption or to make bulk for exporting excess products;
4/ strategic storage is related to the security of supply issues and is mainly applicable to OECD countries.
The business model is often determined by historic choices with regard to clients, business development, and infrastructure development. Especially today it is important to be able to pivot towards more lucrative business models, and as outlined above this can be enabled by smart joint ventures between operators and investors.
4. Customer portfolio
The fourth factor determining the value of a tank terminal is the customer portfolio. Tanks have a lifetime of about 30 years and have long-term lease contracts for the soil they stand on. During this lifetime a terminal will develop a certain customer portfolio and when a terminal is sold the new owner, of course, continues with much of the existing customers. Having a client portfolio that consists of solid companies that have the potential and expressed their will to grow their business at your terminal is definitely very valuable.
5. Product specialization
Finally, the fifth factor for tank terminal value determination is which products specific tanks may store and what product markets the terminal is specialized in. For gasoline, there are other requirements than for, for example, chemicals. Many kinds of safety and sustainability regulations have to be complied with. Furthermore, specialization in certain products has benefits for clients as a terminal can act as a hub for such a product, generating economies of scale and operational efficiencies.
All in all, it’s quite a complex field for
business developers and investors to make their moves. Technical tools like
discounted cash flow or EBITDA multiples can never have the last say. Tank
terminals offer a vast global playing field where sometimes inexperienced newcomers
make very bad decisions. A good team of experienced operators and well-informed
investors however can make tank terminal investments profitable. With the
abovementioned 5 factors in mind, it becomes easier to geographically and
economically zoom in to spot the best opportunities for buyers and
sellers.
Are you struggling to understand the value your terminal provides to your clients?
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Covid-19 also has effects on tank terminals: As soon as the true scope of the Covid-19 pandemic became apparent, the oil market shifted from a backwardated market into a deep contango. Needless to say, this contango immediately led to a significant increase in demand for tank storage.
As the world is slowly emerging from the Covid-19 pandemic, it is safe to say that the corona virus has had a profound impact on nearly every aspect of our daily lives. Besides the more visible effects on public health, society, and transportation, Covid-19 also sent a shockwave through the global economy.
This shockwave also had its effects on tank terminals: As soon as the true scope of the Covid-19 pandemic became apparent, the oil market shifted from a backwardated market into a deep contango. Needless to say, this contango immediately led to a significant increase in demand for tank storage.
The road less traveled?
The demand for road and jet fuels has been affected most by the Covid-19 pandemic. While the short-term effects of national lockdowns on demand for fuels are relatively straightforward (fuel consumption is strongly linked with people’s mobility patterns), it will be the longer-term effects that are the most interesting to keep an eye on.
Large corporations like banks, IT companies, and insurers are already preparing for a ‘new normal,’ where their staff will work more from home after Covid-19 than they did before (source). As people will commute less to their offices, a decline in overall car traffic volume could be expected. Together with the ongoing electrification of road vehicles, we expect that the current surplus for gasoline will increase further.
When we take a look at diesel consumption, reversed dieselization of passenger cars will lead to a faster decline than we will see for gasoline. That being said, because the electrification of trucks is not expected to happen in the coming years, there will still be a large volume of diesel consumption left.
For jet fuel, we forecast that the current deficit for North-Western Europe will grow at a slower pace. While it is expected air travel will largely recover, analysts forecast it will take at least towards 2023 until air travel is back at pre-pandemic levels (source).
Electric vehicles
Over the past few years, the market for electric mobility has seen incredible growth. In 2019, the global electric car fleet exceeded 7.2 million, up 2 million from the previous year. With more and more electric car models being introduced to the market and charging infrastructure improving, this strong growth is only expected to increase. The IEA estimates that by 2030, there will be over 250 million electric vehicles (excluding three/two-wheelers) on the world’s roads. According to the IEA, the projected growth in the Sustainable Development Scenario of electric vehicles would cut oil products by 4.2 million barrels/day. (source)
While battery electric vehicles (BEVs) are considered the preferred solution for short-distance and light vehicles (passenger cars, delivery vans) because of their high energy efficiency, their batteries have a limited energy density compared to traditional fuels. This means that for vehicles with high power demands, such as ocean liners, long-haul trucks, and airplanes, batteries are highly impractical.
Alternative fuels
With an energy density that’s comparable to fossil fuels, e-fuels and green hydrogen are poised to play a crucial role in our transition to sustainable mobility. E-fuels are produced by electrolyzing water, creating hydrogen and oxygen. While hydrogen gas in itself is an excellent renewable energy carrier, it can be synthesized further with carbon dioxide or nitrogen into more stable and easier to handle e-fuels. When using electricity from renewable sources and circular carbon dioxide (such as direct capture from the air), net emissions are close to zero.
While this process’s overall energy efficiency is lower than that of chemical batteries used in BEVs, the much higher energy density of e-fuels makes them much better suited for applications with high power demands, like shipping, trucking, and aviation.
Circular economy
As the call for reducing plastic waste gets louder and louder, the concept of circular economy is gaining traction. While the market for recycled plastics is growing rapidly and will have its effect on the demand for chemicals, it is not foreseen yet that consumption of virgin material will decrease the coming years.
What’s next?
It is clear that both the covid-19 pandemic as well as the transition to sustainable fuel sources will greatly impact the tank storage terminals. The market outlook for the oil and chemical industry will see significant shifts in supply and demand, while the Covid-19 pandemic only adds further complexities to the market. That’s why market intelligence should be on the radar of every terminal operator. During our regular Market Update webinars, we offer our expert outlook on supply, demand, and trade flows and their impact on tank storage demand.
Do you want to make sure that you never miss out on important market updates? Sign up for the next webinar today, so that you are better prepared for what tomorrow will bring.
In this blog, we will take a close look at five alternative fuel candidates that promise to change the tank terminal landscape as we know it today.
As the world slowly but surely is going into an energy transition, new growth markets for tank terminals are emerging. As the demand for traditional fuels as diesel and gasoline will decline in the coming decades, new liquid bulk alternatives are currently being developed to take their places.
In this blog, we will take a close look at five alternative fuel candidates that promise to change the tank terminal landscape as we know it today.
The road towards sustainability
To meet the ambitious goals set out in the Paris Climate Agreement, signatory governments have pledged to drastically cut emissions of CO2 and other greenhouse gasses and work towards a carbon-neutral economy.
In Europe, sectors like agriculture and industry have since made ample progress in cutting emissions. Yet the transport sector is lagging behind. Considering transport accounts for 23 percent of global CO2 emissions, significant efforts need to be made to reduce the environmental footprint of our trucks, boats, and airplanes.
Thanks to advances in renewable energy sources, such as wind turbines and solar panels, we can generate vast amounts of energy in a sustainable way. The biggest challenge ahead of us is storing that energy for when it’s needed and carrying the energy to where it’s needed.
While battery electric vehicles (BEVs) are considered the preferred solution for short-distance and light vehicles (passenger cars, delivery vans) because of their high energy efficiency, their batteries have a limited energy density compared to traditional fuels. This means that for vehicles with high power demands, such as ocean liners, long-haul trucks, and airplanes, batteries are highly impractical.
Future Fuels
With an energy density that’s comparable to fossil fuels, e-fuels and green hydrogen are poised to play a crucial role in our transition to sustainable mobility. E-fuels are produced by electrolyzing water, creating hydrogen and oxygen. While hydrogen gas in itself is an excellent renewable energy carrier, it can be synthesized further with carbon dioxide or nitrogen into more stable and easier to handle e-fuels. When using electricity from renewable sources and circular carbon dioxide (such as direct capture from the air), net emissions are close to zero.
While this process’s overall energy efficiency is lower than that of chemical batteries used in BEVs, the much higher energy density of e-fuels makes them much better suited for applications with high power demands, like shipping, trucking, and aviation.
Methanol
Feedstocks for methanol are green hydrogen, CO2, and electricity. Traditionally, these kinds of synthesizing processes use fossil fuels for their CO2 source, but they can be made almost carbon neutral by capturing the CO2 from the atmosphere.
As methanol is a liquid and does not need to be compressed or chilled for storage and transport, it’s very suitable as a fuel. The energy density of methanol is relatively low compared to E-diesel and E-kerosine. Still, from an economic point of view (cost per GJ fuel energy), methanol has a lot of potential as a fuel for shipping and trucking operations.
E-Diesel
Like Methanol, E-diesel is also produced from green hydrogen and CO2. A Fischer-Tropsch process is required for the synthesis, with an efficiency of up to 69%. Like methanol, e-diesel is easily stored and transported. No modification is needed for existing diesel vehicles, making e-diesel an excellent replacement for fossil diesel applications.
Ammonia
Synthesized ammonia (NH3) consists of green hydrogen and nitrogen extracted from the atmosphere. The synthesis of hydrogen and nitrogen takes place in a Haber-Bosch reactor and can achieve yields of up to 70%.
Production of ammonia is relatively straightforward and easily scalable, but it has to be stored and transported under either cooled or compressed conditions. This requires relatively large tanks, making ammonia only a feasible option for large ocean-going vessels.
E-Kerosine
With a similar process to E-diesel, E-kerosene is produced by combining hydrogen and CO2 through a Fischer-Tropsch synthesis. Compared to other e-fuels, synthesizing e-kerosine is quite expensive. Still, its high energy density and compatibility with existing jet engines make it the only viable e-fuel for aviation.
(Green) hydrogen
Green hydrogen (H2) is made by electrolyzing H2O (water) using green electricity. As electricity is the ‘main ingredient’ of green hydrogen, it’s an excellent energy carrier to store excess energy production from renewable sources like solar and wind. This way, hydrogen gas can act as a ‘battery’ to store electricity production during off-peak hours (let’s say, a windy and sunny Sunday afternoon).
Because storage and transportation of hydrogen must be done either compressed or cryogenic, it is less suitable for long-haul transport applications like oceanic shipping. However, as green hydrogen is a key feedstock for other e-fuels, its importance to future supply chains for renewable fuels cannot be understated.
What’s next?
It is clear that the transition to sustainable fuel sources will greatly impact the tank storage terminals. That’s why market intelligence should be on the radar of every terminal operator. During our regular Market Update webinars, we offer our expert outlook on supply, demand, and trade flows and their impact on tank storage demand.
Do you want to make sure that you never miss out on important market updates? Sign up for the next webinar today, so that you are better prepared for what tomorrow will bring.
In a former article we explored six renewable commodities that might power the emissions free world of the future. Among those, green hydrogen has gained most attention in recent months. What would it cost to import green hydrogen?
Conflation of goals The shift to renewable energy often is advertiser as a shift to energy independence as well.
That might work for some countries with large potential for hydro, wind or solar power but for most countries it is a conflation of goals. Global reduction of carbon emissions is much more important than national energy independence. If part of a country’s energy demand can be met cheaper via imported low carbon energy, low carbon energy will be traded.
Cheap solar power spurs renewable energy export ambitions
Over the last decade, the price of solar panels has decreased at an unimaginable pace. In regions like the Middle-East and South-America the cost of producing solar power consequentially has dropped below 2 dollarcents per kilowatt-hour (kWh). It is to be expected that solar installations in Australia and the Sahara-region soon will follow.
Solar power in these desert regions is available for prices far below wholesale power prices in Europe, the United States, Singapore and Japan. Logically, proposals arise to get this cheap renewable energy to aforementioned markets. Some think enormous new power lines may be the best way to distribute cheap solar power around the world. Others propose converting cheap power to hydrogen, for transport via pipelines or ships.
Shipping in the short term is most probable The solar potential in desert regions is that big, and the challenge of the energy transition in densely populated northern regions that large, that all routes will probably come to fruition someday.
Despite the extra energy losses in transport and liquefaction, transport of hydrogen via ships will probably be the first viable option. Dutch tank storage giant Vopak in 2019 announced an investment in in the German startup Hydrogenious (developing a liquid organic carrier able to bind hydrogen). Vopak also joined a feasibility study for conversion of gaseous hydrogen to liquid ammonia, for use as a marine fuel. In July 2020 Air Products announced a $5 bln plant for production of ammonia using wind an solar power in Saudi-Arabia. Starting in 2025 it would export the renewable commodity to global markets.
Estimates for the cost of green hydrogen produced in the Middle-East
If by 2025 renewable hydrogen or hydrogen derivatives would indeed be available in ports all over the world that would off-course be great for the global energy transition. In the following an attempt to estimate the costs of one kilogram of hydrogen, originating from a 1 gigawatt solar electrolysis plant in Saudi-Arabia.
Basic assumptions and bandwidths:
Solar power generation cost. 1 up to 2 dollarcents per kilowatt-hour (kWh);
Solar capacity factor. ±20%;
Electrolyzer cost. For long, the estimate of the cost of electrolyzers has been about $1,000 per kilowatt. Recent reports have claimed cost could fall rapidly with growing deployment, $200 per kilowatt might even be possible before 2025;
Electrolyzer efficiency. 65 to 80%;
Design lifetime electrolyzer: 10-15 years;
Cost of power per kilogram of hydrogen:
At the mentioned efficiency, 50 up to 60 kWh of solar power is required for every kilo of hydrogen produced. At 1 up to 2 dollarcents per kWh this results in a power cost of $0.50 to $1.20 dollarcents per kilo of hydrogen;
Cost of the electrolyzer per kilogram of hydrogen:
In order to convert all solar power originating from 1 gigawatt of solar panels into hydrogen, an electrolyzer capacity of 1 gigawatt is required. This would cost $200 mln up to $1 bln. At a capacity factor of 20% and over a 10 to 15 year lifespan the electrolysis plant would convert 17,5 up to 26,3 billion kilowatt-hour into hydrogen. Given the efficiency of 50 up to 60 kWh per kilogram that would result in 290 million up to 525 million kilograms of hydrogen over the project lifetime. That gives a spread of $0.40 up to $3.50 of ‘electrolyzer cost’ per kilogram of hydrogen produced.
What would it cost to get the hydrogen to Europe?
The production cost* of solar hydrogen in the Middle-East would end up somewhere just under a dollar to up to five dollar per kilogram. Natural gas derived ‘grey hydrogen’ is prized between one and to dollar per kilogram. Mostly depending on the real cost and lifespan of electrolyzers, solar derived hydrogen might all-ready be competitive with fossil fuel derived hydrogen.
The question remains what it would cost to get this fairly affordable hydrogen to customers all over the world. Estimates for the cost of either liquefaction of hydrogen or conversion of hydrogen to ammonia are hard to find. The cost for liquified natural gas (LNG) might give an indication. Liquefaction of natural gas, shipping between the Middle-East and Rotterdam, handling and one month of storage would cost around $120 per tonne LNG, or about 1 cent per kilowatt-hour of energy content imported.
LNG is about 7 times denser than liquid hydrogen, resulting in significantly less hydrogen transported for a given ship type. Furthermore these estimates for LNG assume consumption of local energy mix for liquefaction and regular marine fuels for shipping. If the hydrogen produced is also to serve for its own liquefaction, transport and processing, more than 30% of the hydrogen would be consumed in the process, resulting in considerably higher costs.
*Aside from power cost, fresh water and labour cost will add to the price of hydrogen. Several optimizations (adding wind power, extra solar power and/or batteries) might help bring down the estimated cost.
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