A new report by the Global Maritime Forum (GMF) highlights Kenya’s significant potential to become a leader in the production of zero-emission fuels, also known as e-fuels, for the shipping industry. The report, titled “Powering clean shipping: Kenya in the global power-to-x economy,” identifies the country’s abundant renewable energy resources as a key advantage. The findings propose that Kenya can produce e-ammonia and e-methanol at competitive costs and supply both its domestic maritime sector and international markets.
Kenya’s Strategic Advantages
Kenya’s potential lies in its ample renewable energy resources, particularly wind, solar, and geothermal power. This gives the nation a strong foundation to produce scalable electro-fuels (e-fuels) through power-to-x processes, where renewable electricity is used to create fuels. This is critical for the shipping industry to meet its decarbonization goals, including the International Maritime Organization’s (IMO) target of using at least 5% zero- and near-zero-emission (ZNZ) fuels by 2030.
Recommendations for Government Action
The report outlines four key areas for the Kenyan government to focus on to unlock this potential:
- Policy and Regulation: The government should create policies to facilitate green hydrogen and e-fuel projects. This includes providing incentives for the maritime sector to use e-fuels and streamlining administrative processes like land rights and permitting. Port regulations also need to be updated to support the use of these new fuels.
- Addressing the Cost Gap: To make e-fuels competitive with conventional fuels, measures are needed to bridge the cost gap. This can be achieved by utilizing global climate finance sources, implementing risk-sharing mechanisms with the private sector, and lowering investment costs.
- Market Transition and Economic Benefits: Kenya needs to prepare for a transition to e-fuels. This involves undertaking demonstration projects, strengthening and expanding the national grid, and engaging in social dialogue with communities to ensure the transition is beneficial for the local economy.
- Expanding International Partnerships: Collaboration is crucial to overcome challenges such as securing final investment decisions for projects and preparing ports. The report recommends that Kenya set strategic goals, such as becoming a regional bunkering hub, and activate industry stakeholders to create a demand signal for e-fuels.
Promoting Demand through Green Corridors
To stimulate a robust demand for e-fuels, the report recommends establishing a green shipping corridor, a specific shipping route between two or more ports where zero-emission solutions are demonstrated. This involves public and private stakeholders working together to coordinate the first use of e-fuels on a specific route before 2030. One example is leveraging the demand from cargo owners, such as those in the cut flower industry, to switch from air to sea freight and pay a premium for e-fuels, possibly through a “book-and-claim” system. Lamu Port is identified as a promising location for pilot projects, with an initial focus on regional trade.
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Source: Safety4sea
