While European oil majors are taking a gamble on hydrogen as the transport fuel for the future, this ‘big bet’ is not so big in reality, according to a new study on behalf of Transport & Environment (T&E), which shows that investments in biofuels refining are eight times bigger.
Ricardo Energy & Environment, a global environmental consultancy, carried out the study on behalf of T&E, a European umbrella for non-governmental organisations working in the field of transport and the environment.
T&E believes that oil producers are not being serious about investing in genuinely clean fuels but choosing the “easy, unsustainable biofuels option”.
Where Europe’s oil giants Shell, BP, Total, ENI and Repsol are investing in hydrogen, only part of this is said to be truly ‘green’. Most of their investments are going towards decreasing the carbon intensity of their refinery operations, not to developing green transport fuels, the study shows.
Geert Decock, Electricity and Energy Manager at T&E, said: “Oil producers are promoting hydrogen as their big bet for the future, but in reality their investments in green hydrogen are pitiful. Instead, they are focusing their new refining capacity on biofuels which cannot sustainably supply the world’s transport needs. This is not an industry pushing the boundaries of clean technology.“
The study points out that oil demand for road transport in the EU will fall by almost a third in 2035 as more cars switch to electric. From 2035, demand for petrol will continue to drop 5% year on year. Much current refining capacity will need to close or, to avoid becoming stranded assets, be converted into processing alternative fuels.