BAKU, Azerbaijan, March 12. E-fuels, particularly e-diesel, are poised to play a pivotal role in displacing fossil fuels in the shipping industry, thereby aiding in climate change mitigation, Trend reports with reference to the Oxford Institute of Energy Studies (OIES).
However, the utilization of e-diesel in the foreseeable future remains uncertain, further complicating efforts to forecast its availability and adoption. Challenges such as inefficiency, exorbitant costs, and the absence of a coherent policy framework continue to impede its widespread uptake.
OIES delves into the sustainability aspects of e-diesel for maritime transport, delving beyond CO2 emissions to explore factors like electricity demand, carbon dioxide sourcing, resource utilization, and socio-economic impacts. The institute stresses the importance of renewable energy sources, closed carbon cycles, and tailored solutions to meet local needs, all critical for ensuring the sustainability of e-diesel in mitigating the environmental impact of the shipping sector.
Nevertheless, numerous hurdles, including substantial land requirements, water scarcity issues, and socio-economic complexities, underscore the challenges associated with transitioning to liquid e-fuels. This necessitates thorough evaluation and the establishment of international standards.
Focusing on countries with the lowest and most competitive costs of photovoltaic (PV) and wind power installations worldwide, OIES finds that the production costs of e-diesel vary across regions and over time, with the Levelized Cost of Energy (LCOE) playing a pivotal role. Despite projected cost reductions until 2030, these are deemed insufficient. Factors such as declining LCOE, technological advancements, and economies of scale are expected to contribute to cost reductions, albeit marginally. Costs are anticipated to remain relatively high until 2050, particularly in pessimistic scenarios, while optimistic projections offer more favorable outcomes.
Despite current high production costs and competition from traditional marine diesel, potential drivers of change, including policy incentives, offer opportunities to reshape the economic landscape of e-diesel. The findings underscore the imperative for government intervention to ensure the economic feasibility of e-diesel production, advocating for decisive measures to facilitate its successful market integration. However, existing regulatory frameworks for e-fuels in shipping encounter numerous challenges, including uncertainty, inadequacy, and a lack of international coordination.
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