Iceland

Country: Iceland

Document type: Concept Note

Title: Hydrogen and E-fuels Roadmap for Iceland

Approved: April 2024

The Government’s long-term strategy is to be fossil fuel independent by 2040. Hydrogen and e-fuels (e.g., e-ammonia, e-methanol, and e-diesel) are expected to play a crucial role in decarbonising the transport sector.

By 2030, the Roadmap notes that, assuming hydrogen and e-fuels would make up 20% of primary energy used for heavy-duty road transport, up to 10% in domestic maritime and 20% in domestic aviation, total hydrogen demand in these uses could reach around 10,000 tonnes per annum, which could require 71 MW of electrolyser capacity. In addition, to reach a 10% share of renewable energy for fuels in international aviation and international navigation by 2030, would require an additional 25,000 tonnes per annum of hydrogen and 155 MW of electrolyser capacity.  This would bring total hydrogen demand in these uses to 35,000 tonnes per annum and total electrolyser capacity to over 200 MW.

By 2040, annual hydrogen demand for heavy-duty road transport, domestic maritime and domestic aviation could reach 60,000 tonnes per annum, equivalent to 430 MW of electrolyser capacity. On the assumption of a complete conversion of fuel use in international aviation and international navigation being addressed with domestic hydrogen production, an additional 304,000 tonnes per annum could be required, bringing total hydrogen demand to 364,000 tonnes per annum, equivalent to over 2,400 MW of electrolyser capacity.

The roll-out plan for hydrogen development is planned in phases:

2020-2030: Building blocks – Reaching 2030 goals. Hydrogen is expected to play a substantial role in heavy-duty transportation, focusing on reaching the 2030 goal of 40% renewable share for road transport. E-fuels are expected to play a role in the maritime sector, with the decade focused on developing pilots and blending to reach the Government’s 10% renewable energy share goal by 2030. E-kerosene pilots will be evaluated for international aviation, and alternative fuels for domestic aviation would be explored further.

2030-2040: Focused development – E-fuels for maritime and aviation sectors. In this decade, hydrogen demand is expected to further increase in all the key transport sectors. To reach the goal of fossil fuel independence by 2040, the maritime and aviation industries will play an increasingly significant role.

 

November 2024