The Debate Between Hydrogen Sourced from Renewables or Fossil Fuels: The Panamanian Inquiry

The vessel exemplifies Panama’s aspiration to become a regional hub for hydrogen, the most abundant gas on the planet, but faces the existential decision of whether to generate it from renewable energy or fossil gas.

This Central American nation of just over four million people is developing, albeit belatedly, the first phase of its roadmap to materialise the National Green Hydrogen and Derivatives Strategy, approved in 2023.

For Juan Lucero, coordinator of the Ministry of the Environment’s National Climate Transparency Platform, green hydrogen would be the best option, given its renewable energy, strategic position and the influence of international policies to reduce greenhouse gas (GHG) emissions in sea transport.

“Panama has natural gas, and companies are interested in taking part in this business, in this case blue hydrogen. If Panama wants to be a hub, then blue is a good option,” he told IPS.

He stressed that “for Panama, it has always been a priority to provide services, to be an energy hub. We have tradition, experience, history, as a hub for supplying bunker (a petroleum distillate) ships. The idea is to achieve that transition.”

The production of hydrogen, which the fossil fuel industry has been using for decades, has now been transformed into a coloured palette, depending on its origin.

Thus, “grey” comes from gas and depends on adapting pipelines to transport it.

By comparison, “blue” has the same origin, but the carbon dioxide (CO2) emanating from it is captured by plants. Production is based on steam methane reforming, which involves mixing the first gas with the second and heating it to obtain a synthesis gas. However, this releases CO2, the main GHG responsible for global warming.

Meanwhile, “green” hydrogen is obtained through electrolysis, separating it from the oxygen in water by… (continued in the next section)

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