Sustainable shipping: exploring the feasibility of investments in hydrogen-powered vessels for the short-sea sector
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- Master Thesis 
Greenhouse gas emission from the shipping industry is increasing. At the same time there is a pressing need to reduce the anthropogenic greenhouse gas emissions. The need for alternative marine fuels is a fact. In this paper I analyze the feasibility of investments in hydrogen-powered vessels for the short-sea sector. The contributions of the paper are to investigate whether such investments are possible from a technical and operational viewpoint, if hydrogen can contribute to decarbonize the short-sea sector and if such investments can be financially viable. These are all essential topics that must be addressed to consider hydrogen as an alternative marine fuel for the short-sea sector. A case study is built based on an announced contract for a zero-emission vessel, combined with data for a concept vessel designed to fit that contract. Through interviews with relevant stakeholders and secondary data, technical and regulatory challenges are mapped. Based on a thorough literature review of hydrogen as a marine fuel, the environmental footprint measured on well-to-propeller is mapped. These results are compared to results for common fossil fuels used today to determine if hydrogen can contribute to reduce greenhouse gas emissions for the short-sea sector, today and in the future. Based on data from the case study, combined with data from the literature, the yearly emissions related to the use of hydrogen versus fossil fuels are calculated. Lastly a thorough analysis of the financial viability is performed based on the case study. Information from interviews with cargo-owners, ship designers and financial institutions is used in combination with current and future estimated hydrogen prices to derive a qualified academic answer. The results from the case study are used in combination with a survey conducted among European cargo-owners and charterers to identify if any of the results are transferrable to the short-sea market in general. The result from the analysis is that investment in a hydrogen-powered vessel is not a feasible option today. Technical, regulatory, and logistical challenges related to building and operating a hydrogen-powered vessel should be possible to overcome. If produced from renewable energy, hydrogen can also contribute to reduce greenhouse gas emissions on a well-to-propeller perspective. The main challenge is related to the financial viability of such investment. Given the level of freight rates, cost of fuel, cost of building such vessel and the cost of renewing the energy converter systems, it is deemed unlikely that such investment can be financially viable today. This applies both to the case study and the short-sea sector in general.