Hong Kong’s ambition to become a hub for hydrogen supply in maritime and aviation depends on policy measures and strategic investments to secure supplies, experts say.
The government must take bold steps to create favorable conditions for demand and encourage companies with the best technologies to invest in pilot projects and infrastructure in the city to promote the use of zero-emission hydrogen, methanol and ammonia from renewable feedstocks, said Leo Yang Xiaohu, general manager of CIMC Enric Holdings.
The Hong Kong-listed company built the city’s first hydrogen refueling station and associated infrastructure, leading to the commissioning of a double-decker hydrogen fuel cell-powered bus. This was one of 14 pilot projects approved by the government to demonstrate the effectiveness and safety of hydrogen in different contexts.
“We need more hydrogen demonstration projects in Hong Kong,” he said. “We need more support from the government and other partners to promote the clean fuel.”
It is about much more than just equipment, as both government and industry need to address the supply of green hydrogen as well as costs, logistics and regulations, he added.
Two months ago, the Hong Kong government announced a strategy to promote hydrogen use by improving regulations, setting standards, supporting talent training and promoting infrastructure development.
This comes after Finance Minister Paul Chan Mo-po said earlier this year that the government would release an action plan to transform Hong Kong into an environmentally friendly maritime refuelling hub. The government is also conducting a feasibility study to supply environmentally friendly methanol to local and ocean-going vessels.
The minister said there are plans to simplify the approval procedures for the transportation and storage of Sustainable Aviation Fuel (SAF) to encourage more airlines to use SAF in Hong Kong.
Green methanol and green ammonia are produced from green hydrogen, a zero-emission fuel made from renewable raw materials and energy.
The Hong Kong Airport Authority will make recommendations on policy measures and infrastructure investments for SAF following the completion of a consultancy study in the third quarter of this year.
The city has the potential to become a SAF supply hub if it can source sufficient raw materials from mainland China or overseas, said Matthew Walden, climate and sustainability partner at Deloitte, who advises governments on policy and investment approaches to decarbonization.
The biggest obstacle to the adoption of SAF in Hong Kong and mainland China is the lack of mandatory usage requirements and the absence of a mechanism for voluntary procurement by companies to offset their carbon footprint from air travel, he noted.
Singapore is ahead of Hong Kong in SAF policy and has the largest SAF production facility in Asia. In February, the Southeast Asian country released an action plan to develop into a sustainable aviation hub, which includes setting a national SAF target and levy, centralising SAF procurement and supporting domestic and regional SAF production.
SAF, which can reduce carbon dioxide emissions from aviation by up to 80 percent, can be made from used oil, municipal waste and inedible plant materials.
CIMC’s Yang said if the Hong Kong government and companies invested in hydrogen production projects in the region, it would help secure long-term supplies and help the city realize its hydrogen hub dreams.
“We are ready to work with local partners to meet Hong Kong’s green fuel needs,” he said.
CIMC Enric is building a pilot plant for environmentally friendly methanol in Zhanjiang in western Guangdong, using waste from the pulp and paper industry.
Commissioning is scheduled for the second half of next year, Yang said, and the plant will have a capacity of 50,000 tonnes per year, with an additional capacity of 200,000 tonnes per year planned.
