S&P Global — 25 June 2024
Daily Update: June 25, 2024
Hydrogen-Fueled Aircraft on the Horizon
By Nathan Hunt
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Hydrogen in aircraft has been unfairly maligned. When the Hindenburg airship attempted to land in Lakehurst, NJ, on May 6, 1937, a sudden catastrophic fire was blamed on the use of hydrogen as a lifting gas. However, recent research has suggested that the cotton fabric covering of the Hindenburg was treated with cellulose acetate and aluminum powder, which may have created the conditions for the airship’s destruction. Nonetheless, the impression that hydrogen explodes unpredictably had become the conventional wisdom with the public. The highly mediagenic destruction of a passenger flight was damaging to hydrogen’s reputation. Hydrogen does indeed burn, but so do the other fuels used to power flight. If they didn’t burn, they wouldn’t be fuels.
Now, by tentative steps, hydrogen is returning to the skies. The company Universal Hydrogen recently completed the first-ever, 15-minute, hydrogen-powered prototype aircraft in Moses Lake, Wash. The airline industry is revisiting hydrogen as a fuel because conventional fuels have significant levels of carbon emissions. Regulations in Europe and the Inflation Reduction Act in the US are aimed at reducing the amount of carbon added to the atmosphere to mitigate the impacts of climate change. When hydrogen burns, the byproduct is water rather than carbon. Depending on how the hydrogen is created and transported, this could substantially reduce emissions from air travel.
Arnaud Namer, COO at Universal Hydrogen, recently joined the "Platts Future Energy" podcast, hosted by S&P Global Commodity Insights, to discuss how existing technology can be applied to air travel today.
“For very small aircraft, like a four-seater ... more or less, the flying taxi that are going to fly 100 miles, battery-electric is the solution that's being developed and is probably the right solution for these applications,” Namer said. “Then, from that point to roughly a 2,000-nautical-mile aircraft for 100 to 200 passengers, hydrogen is the perfect solution because you can keep an aircraft with the configuration as it is today, which is a tube fuselage and wings, and adapt to the hydrogen power.”
The benefit of switching these commuter flights to hydrogen would be that existing aircraft could be modified to use hydrogen fuel cells for power. Hydrogen fuel cells use electric motors, which require less maintenance than existing aircraft engines but use hydrogen fuel to create the electricity for the engine. Hydrogen fuel cells are already in use for some heavy-duty transport in California.
However, Namer cautioned that existing hydrogen technology was impractical for transatlantic flights because hydrogen requires more space than jet fuel, and the configuration and design of the planes would have to change to accommodate these longer flights.
The challenges for the transition to hydrogen-powered aircraft include regulation, infrastructure and price. The Federal Aviation Administration is cautious about approving new technology, and the airline industry will wait for its approval before committing to hydrogen. The airline industry's existing infrastructure is built to service jet engines that burn jet fuel, and introducing a new fuel would require investment and widespread adoption. Finally, hydrogen must achieve relative price parity with the cost of jet fuel to accommodate the notoriously thin margins of air travel.
Today is Tuesday, June 25, 2024, and here is today’s essential intelligence.
Listen: Hand In Glove: The Importance Of Carbon Accounting In Emissions Reduction
Titans of industry have long embraced the concept that what gets measured gets managed. Reaching consensus on measurable items like benchmarks, milestones and definitions of success can be some of the most challenging parts of any multi-stakeholder plan. S&P Global Commodity Insights' Simon Thorne joins EnergyCents hosts Hill Vaden and Sam Humphreys to discuss the importance of carbon accounting to decarbonizing the global economy and how challenging it can be to find consensus when every business sector and host government begins its journey from a different starting point.
—Listen and subscribe to the podcast from S&P Global Commodity Insights
Economic Outlook Eurozone Q3 2024: Growth Returns, Rates Fall
S&P Global Ratings expects GDP growth to accelerate from 0.7% this year to 1.4% next year, up from 1.3% in its March forecasts, as lower commodities prices, especially energy prices, allow terms of trade to rebalance, disinflation to continue, and real incomes to recover. Barring any significant new shock, the 2% inflation target seems to be in reach and likely to occur by mid-2025, as a rebound in productivity, moderation in profit margins and slower wage growth will bring core inflation down further.
—Read the article from S&P Global Ratings
Highlights From Our 2024 European Real Estate Conference
The European commercial real estate (CRE) market is not in the clear yet. Rather, things may get worse before they get better. European banks' capacity and appetite for real estate lending remain constructive though cautious. S&P Global Ratings doesn’t see CRE exposures as a systemic risk for the European banking sector. The picture for European real estate companies, however, is mixed, with some more asset revaluations on the one hand and healthy rental growth on the other.
—Read the article from S&P Global Ratings
Eastbound Dirty Tanker Rates Via The Red Sea Climb As Suezmax Supply Dwindles
Following the latest wave of attacks on commercial vessels in the Red Sea, Suezmax operators with vessels located west of Suez have been increasingly hesitant to cross the canal, which is now reported to command a premium over the longer Cape of Good Hope passage. "Despite the longer journey via the Cape of Good Hope, the pool of available vessels willing to do the trip is much larger than the number of ships willing to dare a run via the Red Sea," explained a dirty tanker market source, pointing to supply fundamentals to elucidate the higher price for eastwards Suezmax transits via the Canal. "Surprisingly, it's not directly related to the age of the vessels, but it's down to the owners; some do it and some don't, and those who do are very few."
—Read the article from S&P Global Commodity Insights
Leak Shuts Down Production Of Nigeria's Nembe Crude
Nigerian oil and gas company Aiteo has shut down production at its OML 29 block after a leak on its Nembe swamp, it announced June 19. Nembe crude production from the license was 23,000 b/d in May, having fallen from a peak of 39,000 b/d in February, according to data from the Nigerian Upstream Petroleum Regulatory Commission, the country's energy regulator.
—Read the article from S&P Global Commodity Insights
Listen: Next In Tech | Ep. 173: Phishing Deep Dive
While most of us have a basic understanding of phishing, the email attack tactic that’s been with us for years, attack techniques and the attacker community have been evolving rapidly. The speed of that evolution is outpacing the ability of users to detect the latest instances of phishing attacks and the advances are not slowing down. Poornima DeBolle, co-founder and chief product officer at Menlo Security, joins host Eric Hanselman to look at how phishing has changed and the options available to defenders.
—Listen and subscribe to the podcast from S&P Global Market Intelligence
2024 Global Emerging Markets Virtual Conference: Is Emerging Asia Picking Up Steam? (July 3, 2024)
Join us for an engaging exploration of the latest trends and opportunities in emerging markets across Asia. This virtual event will feature a dynamic mix of industry professionals and S&P Global Ratings speakers who will share their insights and perspectives on the evolving landscape of emerging Asia.
—Register for the virtual event from S&P Global Ratings