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South Korea plans Northeast Asia’s largest hydrogen hub
26 February 2021Bernadette Lee
South Korea is planning to build a hydrogen industry hub in the
city of Ulsan that it said will be the largest in Northeast Asia as
part of overarching efforts to decarbonize the country's economy by
midcentury.
The hydrogen hub, slated for completion in 2022, will be spread
across 4.7 square kilometers and comprises three main areas: a
hydrogen industry base district focused on producing hydrogen fuel
cells; an electrogene auto factory for manufacturing
hydrogen-fueled electric vehicle parts and supplies; and a research
and development business center.
Ulsan is one of three cities - the other two being Ansan and
Wanju - that will provide key infrastructure for the hub.
"The plan for Ulsan is to utilize hydrogen from local
petrochemical complexes for buildings, fuel-cell electric vehicle
(FCEVs), and ships, amongst others," said Vince Heo, associate
director at IHS Markit in Seoul.
Domestic, overseas funding
Funding for the development of the hydrogen hub is expected to
come from domestic and international companies as well as through
public support. The Ulsan Free Economic Zone Authority expects to
attract $500 million from overseas investors by 2030 and aims to
attract 5.3 trillion won ($4.8 billion) from domestic companies,
according to Heo.
Domestic companies that have indicated a commitment to invest in
the hub include Donghee Industry, Hanwha Research Center, Hyosung
Corporation, and Lotte Ulsan Development. Linde, Air Liquide, and
Bloom Energy are among the international companies involved in the
project.
Indicative of growing support for the project, on 4 February
UK-based Linde, an industrial firm that specializes in producing,
processing, storing, and distributing hydrogen, said it would be
teaming up with Hyosung, one of South Korea's largest industrial
conglomerates, to build, own, and operate extensive new liquid
hydrogen infrastructure in Ulsan.
"This robust hydrogen network will support the country's
ambitious decarbonization agenda to achieve net-zero emissions by
2050," Linde said in a statement released on the same day.
Hydrogen roadmap
South Korea unveiled a hydrogen roadmap in 2019 that outlined a
goal of producing 6.2 million FCEVs and rolling out at least 1,200
refilling stations by 2040. President Moon Jae-in announced a
"Green New Deal" in July 2020 as part of the nation's COVID-19
pandemic recovery plan, which includes investment in and
construction of three hydrogen cities by 2022, with a further three
such cities to be added by 2025, according to Heo.
"The selected hydrogen cities are expected to provide
infrastructure for hydrogen production and shipping that will serve
local residents as a primary energy source," Heo said.
In a speech to parliamentarians on 28 October 2020, Moon
announced that South Korea would "aim for carbon neutrality by
2050," making the country the third in northeast Asia to pledge a
2050 net-zero target, following commitments by China and Japan. The
plan builds upon the existing interim 2030 goal within the
Nationally Determined Contributions (NDC) to cut greenhouse gas
(GHG) emissions by 24.4% compared with 2017 levels.
"This [2021] is the first year when the Paris Agreement has to
be implemented. The government has so far pushed for a low-carbon
economic structure. The effort will be expanded, so our 2050 carbon
neutrality implementation plan can take shape this year in energy,
industry and all other parts of our society," Moon said in a new
year address on 11 January.
But reaching net-zero GHG emissions will require a major
restructuring of South Korea's energy economy, Heo said. South
Korea is the world's 10th-largest emitter of GHGs, with a high
reliance on imported fossil fuels. Nearly 85% of the energy
required by the country's $1.6 trillion economy is dependent on
fossil fuels, all of it imported.
"The country's emissions trading scheme is expected to play a
pivotal role in [the] short to medium term in decarbonizing its
economy as the scheme covers about 70% of total emissions. But a
more concrete roadmap needs to be unveiled by the government in
terms of what technology the country plans to promote for meeting
its net-zero pledge," he said.
In the hydrogen transition, South Korea has strong positions in
FCEVs and stationary fuel cells, law firm Clifford Chance said in a
paper released in October
2020.
"The strategy appears to be driven more by the perceived
opportunities for economic growth and industrial competitiveness
than by climate change objectives. It remains to be seen what
concrete steps or plans will be devised for the shift from grey to
green hydrogen on the production/supply side," Clifford Chance
wrote.
Ambitious targets
The South Korean government has set ambitious targets for
hydrogen-powered FCEVs and the widespread, reliable availability of
liquid hydrogen will be instrumental to achieving these targets,
said B.S. Sung, president of Linde Korea.
"Hydrogen has emerged as a key enabler of the global energy
transition to meet the decarbonization goals set out in the Paris
Agreement," he said.
Cho Hyun-Joon, chairman of Hyosung Group, described the
partnership with Linde as "a cornerstone of the development of
South Korea's national hydrogen economy."
The liquid hydrogen facility to be built, owned, and operated by
Linde and Hyosung in Ulsan will have a capacity of over 30 tons per
day and will be Asia's largest, according to Linde. The facility
will be able to process enough hydrogen to fuel 100,000 cars and
save up to 130,000 mt of carbon dioxide tailpipe emissions each
year. The first phase of the project is expected to be operational
in 2023.
Under the partnership, Linde will sell and distribute the liquid
hydrogen produced in Ulsan to the growing mobility market in South
Korea. This will require the joint venture to build, own, and
operate a nationwide network of hydrogen refueling stations, Linde
said.
The plants in Ulsan will use Linde's proprietary hydrogen
liquefaction technology, currently used to produce approximately
half of the world's liquid hydrogen.
Further details on the UIsan hydrogen hub can be found on Ulsan
Free Economic Zone Authority's website.