With quick and strategic action, Mexico can become a competitive producer and exporter of zero-emission fuels
International shipping accounts for about 3% of global greenhouse gas (GHG) emissions, and this will increase under a business as usual scenario. To decarbonize the maritime industry, there will be a massive need for green fuels and associated technologies. In particular, Scalable Zero Emission Fuels (SZEF) such as green hydrogen and green ammonia are considered the most promising fuels for the energy transition of maritime transport.
“Over the past few years, the global maritime industry has made rapid progress in developing new innovations and technologies to meet the sector’s emissions reduction challenge and is now moving towards full decarbonisation. The massive demand for zero-emission fuels that will arise is a major growth opportunity for Mexico, which has the chance to become a future powerhouse for international shipping in Latin America,” said Ingrid Sidenvall Jegou, Project Director at Global MaritimeForum.
With access to the Pacific and Atlantic Oceans, well-established shipping routes and trade relationships with multiple continents, Mexico can, according to the new P4G-Getting to Zero Coalition report, tap into new markets and establish itself as a global energy hub. and supplier of green fuels. Realizing this potential can accelerate the transition to cleaner forms of energy across the economy, creating several opportunities for the country.
“As hard-to-reduce sectors like shipping strive to meet their 2050 decarbonization targets, countries like Mexico, with significant renewable energy potential, can position themselves as providers of much-needed zero-emission fuels. to industry transition. Realizing Mexico’s renewable energy potential will require collaboration among key stakeholders, including governments, ports, industry and finance, to reduce green fuel costs and enable large-scale production,” said said Pedro Gomez, head of the platform for shaping the future of mobility at the World Economic Forum. .
Being part of the transition for maritime transport and investing in it itself, Mexico could create new sources of income from exports and SZEF bunkering, establish hubs and green ports, as well as open possibilities for green corridors along the main maritime routes.
According to the report, estimates show that developing green fuel infrastructure to serve Mexico’s maritime sector could attract investments of up to MXN$37-53 billion ($1.9-2.7 billion) in terrestrial infrastructure by 2030.
After extensive consultation with key Mexican stakeholders, the report cites three key opportunities for Mexico, including the port of Manzanillo, DH2 Energy’s operations in central Mexico and Baja California, each of which has the potential to benefit production, collection and distribution of SZEFs.
However, to unlock these opportunities, it is essential to have an enabling political and financial framework capable of effectively motivating and bringing together key players from all sectors and value chains.
Mexico currently lacks a favorable ecosystem both politically and financially to leverage the production and use of SZEF, especially given the current administration’s preference to continue to exploit the country’s fossil fuel resources.
“For each country, the transition of maritime transport will be a unique experience. For Mexico, this is an opportunity to take advantage of its renewable energy potential and its proximity to important maritime activities to become a producer and supplier of future fuels. Yet Mexico also has an opportunity to align its domestic energy focus with its international climate representation and create a policy landscape that facilitates transitional investment and innovation, while achieving many of its Sustainable Development Goals,” said Dr Alison Shaw, shipping policy manager at UCL Energy. Institute.
As other Latin American countries take steps to prepare their own bunker supply chains and engage with the international shipping industry, Mexico should take quick and strategic steps to position itself as a competitive producer and exporter of SZEF. With the right incentives and targeted actions to encourage investment in renewable energy and fuel production, Mexico can gain a competitive edge in bunkering and exporting SZEF in Latin America, the report concludes.
“As Mexico charts its course towards sustainable development, this report highlights concrete steps the country can take to produce green fuels. This will help create jobs, develop clean energy in all sectors and attract green investments. P4G is pleased to support the report of the Getting to Zero Coalition partnership, so that Mexico can build on this momentum and take the quick steps needed to transition to zero emissions shipping,” said Ian de Cruz, Global Director at P4G.
Source: World Maritime Forum