The management of carbon

Transcription

1 Planning for carbon capture An investment planning roadmap for a project incorporating carbon capture should address the scheme s basic objectives and its viability in the market Suzanne Ferguson Foster Wheeler The management of carbon and energy security can be approached in much the same way as any other new investment project. By using an investment planning approach and applying this specifically to focus on energy security and greenhouse gas (GHG) management, the selection of the right project to meet objectives can be achieved. This article explains how an investment roadmap model can be adapted to projects tailored to energy security and carbon reduction, including location and process considerations. The goal of investment planning is to support companies in the selection of the right project to achieve their strategic goals. This involves determining if the projects are both economically and technically feasible, ensuring the optimum use of capital and determining the most appropriate timeframe for the project. There is a wide range of questions to be addressed when embarking on a new project, such as: What products are required? What feedstocks are available? What are the possible process routes? Is the proposed location suitable? The best way to meet the project s requirements is to follow a simple roadmap process (see Figure 1). Investment planning roadmap Agree objectives It is fundamentally important to define what the project aims to achieve. This can range from a simple debottleneck of a plant to achieving a carbon dioxide ( ) Figure 1 The investment planning roadmap emissions target for a global corporation. There may also be a number of stakeholders involved, so this stage is key in ensuring alignment between the parties involved. Market analysis This step is essential to drive the configuration of feedstock, product slate and plant towards the optimum economic solution, thus maximising the plant s margin. Market analysis will determine product demand and price (including pricing, for example), as well as the price and availability of feedstocks. Plant configuration studies For most applications, linear programming (LP) is used to develop a model of the project, incorporating product yield, capital and operating cost data for each potential unit operation. The results of the market analysis are also input into the model, which is then run to determine the best performing configuration on a net present value (NPV) basis. The LP model generated can then also be used to explore rapidly a number of what-if scenarios, enabling the project s economic sensitivity to variations in key product or feedstock prices to be understood. Site selection The suitability of the proposed location (or locations) can be assessed by considering four key factors: Site: land availability, ground conditions, structures and obstructions, severe weather protection, earthquake zonal rating Port: already existing, dredging requirements, jetty location, existing facilities, suitability of surrounding waterways Infrastructure: local and national PTQ Q

2 road network, heavy haul routes, rail network, regional and national airports Local area: towns and industry nearby, construction resources, schools and emergency services, prevalent health hazards, landfill materials, local labour. This assessment looks at the suitability of prospective sites and enables the cost of infrastructure development, ground remediation and so on to be factored into the cost estimate. Offsites and utilities Scope of the utilities and offsite requirements will be based on data from process unit technology providers and from the contractor s own data. Major equipment lists for all utilities, tankage and other offsite requirements will be identified, including intermediate tankage based on high-level shutdown philosophy and marine facility requirements. Constructability studies It is crucial to consider constructability during the investment planning stage of a project in order to determine issues that could impact the design. Such issues include access routes for large or heavy equipment and the costs/ benefits of modular rather than stick-built fabrication. At this stage, a high-level schedule for the full project through to start-up can be developed and the contracting strategy can be planned. Cost estimates Cost estimates, based on current market data for the plant s location, are based on stages in the investment planning process. Highlevel operating costs, including maintenance, insurance, labour, feedstocks, catalyst and chemical requirements are developed, along with the capital cost estimate. Economic and financial modelling Capital and operating cost estimates are fed into models to ensure that the plant economics are sufficiently robust and achieve the objectives specified at the beginning of the investment planning process. Assumptions within the models should reflect the company s longterm outlook and should consider a number of scenarios. The project s internal rate of return (IRR) should be considered, along with the NPV, in order to determine the magnitude of the reward for the estimated costs of investment. Investment planning process conclusion Investment planning can be an iterative process and, while changes are frequently made in later design stages, the earlier they occur in the project s development the lower the cost of changes and iterations. A well-conceived investment plan, based on real data and tested against real scenarios, gives a sound basis upon which to progress the project and meet the original objectives of the company. The plan should focus on all issues affecting It is crucial to consider constructability during the investment planning stage of a project to determine issues that could impact the design the project s cost and development not just the configuration of the process units. The roadmap approach to investment planning can be tailored to any type of project to ensure that goals are achieved and that the right project solution is developed from the beginning. The roadmap approach can be applied to maximise energy security and to manage GHG emissions. Technology options that can be applied in these areas must also be considered. Energy security and GHG management options A well-developed design, utilising optimal feedstocks, energy integrated flow schemes and a high-value product slate, is inherently likely to be efficient, minimising energy demand and waste streams. However, there are almost always some unavoidable energy demands and carbon emissions. This section introduces some of the key options for mitigation of energy security risks and abatement of GHG emissions. This article deals only with, since it is the largest single contributor to the greenhouse effect. Energy security Energy security can mean different things to different people, but is generally related to a need to ensure access to low-cost and reliable energy supplies. Threats to energy security can be from a number of sources, such as: Political instability Attacks on energy infrastructure High dependence on single primary fuels through lack of diversification of supply Severe weather, accidents or natural disasters Unreliable electricity supply and/or transmission systems Limited supplies of primary fuels Fluctuating primary fuel prices. Energy consumption is well documented as rising directly in line with population growth and GDP. This has led to seriously overburdened energy infrastructure in many parts of the world, where either population or industry, or both, are increasing rapidly. This can apply to both fuel and electricity resources. Therefore, security of energy supply is a key concern for many operators. In the process industries, there are a number of ways to improve the energy security of a plant or plants. Reducing energy demand and increasing energy efficiency can make the site less vulnerable, but does not, in itself, deliver energy security, unless there is also a reliable power supply sufficient to meet the plant s reduced needs. Options for delivering energy security centre on using a diverse range of sources of supply, such that, should one source fail or become too expensive, an alterna- 28 PTQ Q

3 Figure 2 Pre-combustion flow scheme tive can be used. This can apply to either on-site or over-the-fence electricity generation, as well as to process heating; however, we will refer here primarily to on-site generation and process heating, which provide the plant with greater independence from external threats to energy supply. On-site power generation can be significantly more efficient than standalone power generation, since it can be integrated with the process. A number of options for integration include: Power generation from steam raised in waste-heat boilers Boiler feed water preheating against process-generated lowgrade heat Cooling water (for process cooling) against a cold process stream Use of on-site sources of fuel. Optimisation of energy integration across the site can also reduce the need for energy inputs to the plant; for example, the addition of new process units may provide a source of waste heat that can eliminate the need for a process heater elsewhere. It is important to consider that the plant must still be able to start up and maintain availability, so the capital expense may not be significantly reduced by energy integration. However, if the plant is able to run for a significant proportion of its operating hours with fewer process heaters in operation, then clearly the energy demand of the plant will be reduced. If both power and steam are needed by the process, cogeneration of electricity and steam (or hot water) for process heating in a combined heat and power (CHP) plant should be considered. If the CHP plant can accept a number of different feedstocks, such as coal, fuel oil or locally produced biomass, its contribution to the energy security of the site is even greater. The addition of renewables to supplement the power generation portfolio can also increase the diversity of generation; however, the likely load factor of each type of generation should be taken into account. Adding renewables also helps to directly reduce the GHG emissions of the plant. Carbon abatement options There is mounting worldwide concern over the prospect of climate change due to anthropogenic emissions, to which the power generation and processing industries are major contributors. There are a number of drivers for the process industry to manage and reduce its emissions, most of which lead back to concern over climate change. Whether the site wishes to make the most of an opportunity for additional income from the sale of credits or to mitigate the risk of penalties imposed by future legislation, the management of emissions is growing in importance. Greenfield development projects have the advantage of being able to design their processes for reduced emissions through process selection and choice of primary energy supply. Both new and existing plants can consider the following options: Efficiency improvements Fuel substitution Feedstock substitution Configuration modifications Carbon capture and storage. It is generally recognised that the most cost-effective approach to carbon abatement is improvement in efficiency, which can be potentially applied to existing and planned assets. Configuration modifications can mean swapping one or several process units for more efficient alternatives, or debottlenecking part of the plant to minimise carbon emissions to the atmosphere. Most options will be specific to the location and type of plant; however, carbon capture and storage can be applied to almost all processes in some form or another. Carbon capture and storage Carbon capture and storage (CCS) is the process of removing or reducing the content of streams normally released to the atmosphere and transporting captured to a location for permanent storage. CCS can be applied to a wide range of large, single-point sources, such as process streams, heater and boiler exhausts and vents. Three principal groups of technologies are employed: Pre-combustion capture Post-combustion capture Oxyfuel combustion capture. Once captured, is compressed, dried and transported to a suitable storage location, such as saline aquifers, depleted oil fields where enhanced oil recovery could be employed and depleted gas fields. Pre-combustion capture A solid or gaseous feedstock is fed to an oxygen or air-blown pressurised gasifier or reformer, where it is converted to syngas. The syngas is then passed through a shift reactor, which increases the hydrogen and content of the syngas. This high-pressure, high-temperature syngas is then cooled, before being washed with a solvent to absorb the, leaving an essentially pure hydrogen stream and a -rich solvent stream. The solvent regeneration process then releases a stream that can be dried and compressed for export. This process 30 PTQ Q

4 offers high potential for integration, as it generates a pure, high-pressure hydrogen stream, and the syngas cooling train can be used to raise a significant quantity of HP, MP and LP steam (see Figure 2). Variations: A range of coals, petcoke, fuel oils, municipal solid waste and biomass can be used as gasifier feedstock Natural gas and light liquid feedstocks can be used with a reformer A range of solvent removal systems are available, including Selexol and methyl-diethanolamine (MDEA), as well as alternative technologies such as membranes and pressure swing absorption (PSA). Post-combustion capture Flue gases from power generation are cooled by direct water contact before they enter a blower designed to overcome the absorption system pressure drop. The flue gases enter the absorption column, where they are washed with a solvent such as monoethanolamine (MEA). The flue gases are stripped of up to 90% of their content and released to the atmosphere from the top of the absorber. The -rich solvent is then heated against lean solvent and regenerated in a stripping column. The solvent then returns to the absorption column, while the released is dried and compressed for export. The highlight of the post-combustion process is that it is suitable not only for new installations, but also may be retrofitted to existing plants (see Figure 3). Variations: A range of processes use different solvents: MEA, ammonia, sterically hindered MEA and even seawater For high-sulphur feeds, the process can be coupled with a flue gas desulphurisation unit, enabling the direct-contact cooler to be eliminated. Oxyfuel combustion capture In this process, fuel is combusted with oxygen from an air separation unit. The temperature in the boiler is moderated by recycling a portion of the flue gas back to the combus- Flue gas Direct contact cooler Excess water Absorber Blower Vent Figure 3 Post-combustion flow scheme tion chamber. The flue gases pass through an electrostatic precipitator to remove particles, limestone scrubbing to remove sulphur, and cooling and condensation to abstract water. The remaining flue gases contain a high proportion of, which can then be purified, dried and compressed for export. Steam from the boiler is used to generate power via a steam turbine (see Figure 4). Variations: A range of fuels can be used in an oxyfuel flow scheme It may be possible to convert existing boilers into oxyfuel boilers if they can be sufficiently sealed. Other processes There are a number of processes that do not fit exactly into one of the above categories by definition, although the technologies are the same. For example, in the ammonia process, a stream of is produced as part of the process; this is removed by solvent washing according to the scheme for precombustion carbon capture. However, the ammonia process Figure 4 Oxyfuel flow scheme Lean solvent HEX Stripper Drying and compression export does not obviously fall into this group, since the stream was never intended to be combusted and, therefore, cannot be called precombustion. The removal of from natural gas in natural gas treating plants is a further example of this type of process. Investment planning for energy security and GHG management An energy security and/or management project requires each of the steps to be identified in the investment planning roadmap, just as any other project does. Applying the investment planning approach ensures that objectives are well defined, the project is appropriate to the market, the configuration of the solution is optimal, the costs are well defined, and the economic and financial case is robust. Agree objectives At this stage, the aims of the project and the scope to which they apply should be determined. For example, a company may wish to reduce emissions from all of its process plants to meet an internal goal, or it PTQ Q

5 may wish to focus on one location in which there is a specific driver, such as an emissions trading scheme. Likewise, there may be a plant with a need to improve energy security in response to a frequently interrupted electricity supply from an overloaded, overthe-fence grid connection. With any investment project, a number of stakeholders will be involved and it is important to keep them all positively engaged, particularly if a new technology such as CCS is to be employed. Nongovernmental organisations (NGOs) and local residents may be concerned about new technology and require reassurance that risks to the environment and safety are mitigated responsibly. They may also wish to know what other options were considered during the project development. Market analysis A wide range of schemes offers incentives for energy efficiency and reduced emissions; these augment the natural economic driv- ers for the process industry, to minimise waste and maximise quality and output. Understanding what is available in the region in which a project will operate could enable the project to be significantly more economic. Examples include regional emissions trading and grants for new or clean technology demonstrations. The reverse can apply, particularly with the currently uncertain future of regulating GHG emissions, if taxes or levies may be brought into force in the near future. Being at a transition point in legislation can make it particularly difficult to predict and select a firm basis for investment. Equally there may be the opportunity to use captured for enhanced oil recovery or enhanced gas recovery, either by the project company itself or sold over the fence to an operator. Understanding the market and legislative context of the project will help to mitigate the risk of being locked into expensive carbon penalties or high electricity or fuel prices, while identifying any additional revenue streams that may not usually be encountered. Plant configuration studies Once the project s objectives are defined and the applicable market and legislative framework is understood, potential process routes and technologies can be identified. LP is useful for determining the optimum configuration for energy security and for minimising emissions. The ability to run a number of what-if scenarios, once the LP model has been developed, enables the project s sensitivity to volatile fuel, electricity or carbon prices to be understood. In addition, the impact of low availability in process units with a high energy demand can be determined, and an assessment can be made of how to configure the plant for optimal conversion of feedstocks into products carrying the highest margin. The cost/benefit of building redundancy into the power supply can also be quantitatively assessed. Just as the product yield and 32 PTQ Q

6 energy demand of each process unit is built into the LP model, so can it include the amount of emitted. This enables the minimum emissions case to be identified. If the minimum emissions case is not economic without carbon capture, as a result of a high anticipated carbon emissions penalty, carbon capture units can be added to the model to determine whether this will improve the project s margin, despite the additional capital and operating costs. Case study A hydrogen production unit (HPU) in a refinery produces a significant portion of the site s emissions and can be the ideal candidate for reducing emissions. A number of capture techniques can be applied. For example, Foster Wheeler has previously compared the following options: A Pre-combustion capture on HPU syngas between the shift reactor and the PSA B Post-combustion capture on the HPU reformer itself, where the reformer is fired on PSA tail-gas C Post-combustion carbon capture on other refinery fired heaters, fired on natural gas. In this study, both of the carbon capture options (A and B) delivered significant emissions reductions at a lower project cost (capital and operating) than applying postcombustion capture to other refinery fired heaters on the site. Site selection While market analysis will have dealt with locally applicable drivers and the price and availability of primary fuels and/or reliable electricity supplies, there are several additional points to be considered with respect to site location. Most critically, for a project to even consider CCS as an option for emissions management, a suitable storage location, and a viable transport route to that location, must be identified at the earliest stages of the project. While some projects may be conveniently located close to a depleted oil or gas field, others may be relatively stranded. Options such as shipping can be considered in such cases, although selection of alternative technology, or retrofit, may be a more appropriate alternative. The site selection stage should also consider whether renewables would offer advantages. For both new and existing sites, the availability of extra plot space should be considered. Currently, many countries require power generators to prove that their new plant is carbon capture ready (CCR), which usually translates to ensuring that there is sufficient additional space on site to locate the capture plant, and identifying a storage location. For retrofit projects, the available space may be a key determinant in the selection of technology. For example, a site with a number of dilute sources of may wish to The investment planning roadmap ensures that project objectives are well defined and the economic case is robust optimise the layout of a capture unit by locating the capture unit s absorption step close to the source of emissions and pumping -loaded solvent to central solvent regeneration and compression units, thus minimising the space required close to the source and reducing the amount of ducting required. Offsites and utilities The requirements for utilities and offsites are specific to the process configuration. More attention than usual may be paid to sparing and redundant capacity, but otherwise this step is largely unchanged from the general roadmap. Constructability studies For a CCS project, the physical size of the equipment, particularly for a post-combustion scheme, presents challenges in terms of ensuring constructability. In some cases, the factor determining the number of absorption trains required is fixed by the capacity of the largest possible size of vessel that can be shipped to the site. Cost estimates, economic and financial modelling Economic modelling when designing for maximum energy security may be made slightly more complex by considering a greater number of options, or by performing sensitivity analysis on key variables such as plant availability. A revenue stream with an uncertain value, such as, should be explored to determine the levels at which different options become economic. Conclusion The investment planning roadmap ensures that project objectives are well defined, the project is appropriate for the market, the configuration of the solution is optimal, the costs are well defined and the economic case is robust. This rigorous and staged process is particularly important for projects in which there is a wide range of unknowns, such as future price or penalty and volatile fuel prices, coupled with an array of potential options for mitigation. Breaking the investment planning process into manageable stages enables a clearer picture to be drawn and recorded with respect to which options have and have not been considered and how they compare against each other and against the overall objectives. This article is based on a paper presented by Mike Green, Process Consultant, Foster Wheeler, at the Lovraj Kumar Memorial Trust Annual Workshop, Managing Carbon Footprints in the Process Industry, New Delhi, Nov Selexol is a trade mark; the process is licensed by UOP LLC. Suzanne Ferguson is a Senior Process Engineer with Foster Wheeler, Reading, UK, where she is a member of the CCS and gasification team in the Business Solutions Group. She has a master s degree in chemical engineering from the University of Surrey, UK. suzanne_ferguson@fwuk.fwc.com PTQ Q