Bio-CO 2 value chains for demonstration. NEO-CARBON ENERGY 9 th RESEARCHERS SEMINAR, Janne Kärki, VTT 13/12/2017 1

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1 Bio-CO 2 value chains for demonstration NEO-CARBON ENERGY 9 th RESEARCHERS SEMINAR, Janne Kärki, VTT 13/12/2017 1

2 WP3 work during NCE Phase I Altogether 16 individual studies on industry-integrated P2X concepts Altogether 10 individual studies on enabling framework Link Link

3 Conclusions from Phase I business case studies Especially attractive sites for P2X integration are CHP plants and wastewater treatment plants, where heat can be utilised. Additionally there are rather good integration opportunities within pulp mills, steel industry and in ammonia production. For the 1 st applications the best paying capability is offered in transportation fuels. Utilisation of at least 1-2 side products (heat, oxygen, steam) for additional revenue is typically required to enable profitability.

4 Bio-CO 2 value chains - project Find sustainable new business from biogenic carbon dioxide value chains in Finnish biomass driven industry sectors for: synthetic fuel production biogas upgrading industrial chemicals other valuable products utilising bio-co 2 Project schedule: New CO 2 capture, purification and utilisation solutions and services demonstration activites in separate project(s)

5 Key tasks WP I: CO 2 utilisation Review study on different pathways Case studies in different process environments Vision on possible value chains WP II: CO 2 capture & purification Most potential CO 2 capture locations in Central-Finland Review on CO 2 capture & purification in utilisation-scale solutions Co-operation with possible Finnish technology developers Dissemination www, articles, media, some, etc. Workshops and a company road-show Seminar participation Sustainable new business from biogenic carbon dioxide

6 Main CO 2 utilisation routes and options CARBON DIOXIDE, CO 2 Mineralisation -Concrete curing -Aggregates -Mineral carbonation -Precipitated calcium carbonate (PCC) + Polymers -Polycarbonates -Polyols Chemical conversion +H 2 Fuels & chemical intermediates Biological conversion -Algae cultivation -Greenhouses -Gas fermentation (e.g. biological methanation) +H 2 +N 2 Commodity - Renewable urea Direct use -Food/beverages -Industrial gas -Refrigerant -Working fluid -Solvent -ph control -Enhanced oil recovery (EOR) -Enhanced coal bed methane (ECBM) Methane (CH 4 ) Methanol Formic acid Syngas (CH 3 OH) (HCOOH) (CO+H 2 ) Formaldehyde Fischer- Tropsch (FT) Gasoline, diesel, olefins... MTBE*, DME** Gasoline Methanol, ethanol.. *methyl-tert-butyl ether **dimethyl ether Olefins 6 NOTE: The diagram presents only the most important options for the near-term. There are other routes such electrochemical and photochemical routes and hundreds of other possible products.

7 Vision: New CO 2 -based production in Central-Finland 7 Sampo Mäkikouri

8 Case study examples Purpose: study the economic feasibility of CCU processes in different biobased industry sectors Case 1: Sawmill case a) Methane b) Methanol c) Formic acid Case 2: Boosting biogas production a) Stand-alone biowaste digester b) Waste-water treatment plant The cases are generic in nature: they do not represent any actual site and thus various assumptions regarding e.g. heat demand have been made

9 Why have we chosen these products? a) Methane (CH 4 ) - Transport fuel sector offers good payment capability - High technology readiness level (TRL8) demonstrated at relevant scale already b) Methanol (CH 3 OH) - Large market: important bulk chemical & chemical intermediate, can also be as fuel - Methanol is used in production of resins/adhesives for wood industry - Methanol is imported to Finland - High technology readiness level (TRL8) demonstrated at relevant scale already c) Formic acid (HCOOH) - High-value chemical with low risk of substitution: used e.g. in animal feed, leather tanning, textile dying and for producing de-icing agents - Theoretically attractive synthesis route from CO 2 and H 2 (no side-products, CO 2 +H 2 HCOOH) - Currently limited market size & low technology readiness level (TRL3-5)

10 Integration of bio-ccu to the sawmill Selected scale is 9 MWe electrolyser corresponding to the Europe s largest water electrolyser (Woikoski, Kokkola, Finland) CO 2 is captured from the biomass boiler, which provides the needed heat for the sawmill and produces also district heat CO 2 is purified to the required specifications Constant costs of purified CO 2 are assumed CO 2 Heat, produced as a side-product of Power-to-X applications, is assumed to be fully utilisable and also the possible steam demand of Power-to-X can be covered by the biomass boiler There is no demand for oxygen at site: In optimistic scenarios, it is assumed that some revenue can be generated from O 2 In conservative scenarios oxygen is assumed to be vented 10

11 Simplified block diagrams Formic acid synthesis Chemical conversion of CO 2 and H 2 via homogenous catalysis ~1/5 Eastman/Taminco s Oulu plant Water Electrolysis H 2 =67% LHV) 1620 kg/h Electricity & grid service Amine FA-Amine adduct Formic acid O 2 Steam 8.5 MW 1440 kg/h CO kg/h 181 kg/h Synthesis conv.h2 =63% conv.co2 =98% FA-adduct Free amine Catalysts Methanol Amine Liquid-liquid separation of catalysts FA-adduct Methanol Formic (85%) acid 3060 kg/h Reactive distillation (separation and purification of FA from amine-adduct) Stripping of solvent (methanol) Amine+catalysts Heat 3.7 MW Methanol 105 bar & ~90 C, ruthenium- and phosphino-based catalysts Tertiary amine for adduct-formation and polar solvent (methanol-water) Steam required for separation of solvent and amine from the product 11 Perez-Fortes&Tzimas (2016). Technoeconomic and environmental evaluation of CO2 utilisation for fuel production Synthesis of methanol and formic acid, Joint Research Centre, Report EUR EN, 86 p.

12 Economic feasibility evaluation Hourly plant operation model for P2X processes The NCE-model is based on mass and energy balances calculated from given efficiencies and chemical conversion rates, losses etc. for each process Main input variables: Price/values of process inputs and outputs Hourly electricity prices, constant price for others CAPEX and O&M costs Economic parameters (e.g. WACC, lifetime) Results: Cost and income structures Profit, EBIT, EBITDA, Payback period, IRR and levelised cost of product (taxes not considered) Operation mode distribution (full load, FCR, stand-by) Sensitivity: Optimistic and conservative scenarios for market values Sensitivity towards main variables 12

13 CAPEX of the main processes Total investment costs are scaled from the reference size specific costs according to equation: Cost = Reference cost Capacity Reference capacity Alkaline electrolyser (eff. 67% LHV) Chemical methanation Biological methanation (raw biogas as feed) Biological methanation (pure CO 2 as feed) Methanol synthesis OPEX: Formic acid synthesis Reference specific costs Reference capacity [1] BioCat Project Final Report [2] Same as [1] but assuming 30% cost reduction for pure CO 2 feed [3] Derived from Perez-Fortes&Tzimas (2016) Scaling factor 1000 k /MW e 9 MW e k /MW SNG 5 MW SNG k /MW SNG [1] 510 k /MW SNG [2] 5 MW SNG [1] 5 MW SNG [2] 0.40 [1] 0.40 [2] 1000 k /MW MeOH 5 MW MeOH k /(t FA /h) [3] 1.5 t FA /h [3] 0.67 WACC 6%, 20 years Installation/project cost of 15% is added to costs 9 MWe plants: SNG & MeOH ~18 M Formic acid ~27 M 2 MWe plant SNG ~5 M (biol.methanation) 13

14 Market parameters Optimistic scenario Products SNG 80 /MWh MeOH 100 /MWh Formic acid 700 /t Electricity spot price scenario Electricity transmission + net taxes FCR scenario Finland % (avg. price 25.6 /MWh) Extra price variation ±30% 11 /MWh 11 /MWh Finland 2016 fixed (17.4 /MW, h) Conservative scenario SNG 60 /MWh MeOH 70 /MWh Formic acid 600 /t Finland 2016 (avg. price 32.0 /MWh) Finland 2016 fixed (17.4 /MW, h) Biogas pump price today ~80 /MWh (VAT0%) CO 2 capture+purification 30 /t CO2 50 /t CO2 O 2 utilisation 50 /t O2 0 /t O2 Heat utilisation* 30 /MWh 20 /MWh Steam utilisation* 30 /MWh 20 /MWh Investment subsidy 30% 0% *NOTE: in case of formic acid synthesis which is a net consumer of heat+steam the higher values for heat and steam ( /MWh) are actually decreasing the competitiveness

15 Results - Sawmill case Optimistic scenario Conservative scenario k /a k /a k /a years /MWh or /kg 15 Assumed value of product: 80 /MWh 100 /MWh 0.70 /kg 60 /MWh 70 /MWh 0.60 /kg Formic acid case is highly profitable even with conservative market parameters while SNG & MeOH are clearly unfeasible SNG and MeOH would require the product to have roughly a double value to break-even With optimistic assumptions SNG is just about profitable, while MeOH can generate somewhat more profit LCOP = Levelised cost of product, /MWh for SNG and MeOH, /kg for formic acid

16 Results Sawmill case Formic acid sensitivity study k /a k /a k /a years /kg Reference value was 0.6 /kg There is a lot of uncertainty with formic acid case due to low TRL Highest uncertainly for catalyst costs especially for the catalyst consumption as the process has not been piloted yet 8-fold increase in catalyst costs or the decrease of product value from 600 ~400 /t, would make formic acid case unfeasible

17 Results are described in more detail in: Sampo Mäkikouri, Markus Hurskainen, Janne Kärki, Eemeli Tsupari, Eija Alakangas, Cyril Bajamundi (2017). INTEGRATED UTILISATION PATHWAYS FOR BIOGENIC CARBON DIOXIDE IN BIOMASS DRIVEN INDUSTRY SECTORS See also:

18 From desktop studies to action

19 Project: Demonstration of bio-co 2 products with novel research platform Kestävää kasvua ja työtäohjelma

20 Key objective Demonstrate utilization of biobased CO 2 as a raw material for synthetic transportation fuels boosting bio-sng production or industrial chemicals/products Schedule Kestävää kasvua ja työtäohjelma

21 Targeted research platform Investment on mobile hydrogen production unit will be made and it will be integrated with existing VTT s synthesis unit and industrial CO 2 streams Kestävää kasvua ja työtäohjelma

22 Demos Demonstrations with the developed platform will be conducted within e.g. bioproduct mill or in bioethanol or biogas production Kestävää kasvua ja työtäohjelma

23 Mobile synthesis until (MOBSU) MOBSU is a multipurpose synthesis unit for CO 2 upgrading to energy carriers and chemicals which can be transported on-site where CO 2 emissions and energy are available. - Control room - Process area - Gas alarms and safety system - Gas analysis CO 2 H 2 PRODUCTS: - WAXES AND LIQUID HYDROCARBONS - SYNTHETIC NATURAL GAS - METHANOL Kestävää kasvua ja työtäohjelma

24 Electrolyser investment Competitive bidding process: (31/08/2017) 23 Target Companies (26/10/2017) 16 Contacted Companies (01/11/2017) 9 Companies Logged-in to Claudia System (13/11/2017) 2 Companies submitted tenders (30/11/2017) Decision was approved, published in Claudia End of May Expected Delivery Kestävää kasvua ja työtäohjelma

25 Electrolyser - Main Features Giner ELX Electrolyser: Proton Exchange Membrane (PEM) electrolyser Production of 4 Nm 3 /h with 55 bar output and 50 bar storage pressure Nominal power ~20 kw Hydrogen purity is % Housed in standard 10ft shipping container Giner ELX PEM electrolyser in an IP55 container Kestävää kasvua ja työtäohjelma

26 Electrolyser - Key Components Kestävää kasvua ja työtäohjelma

27 CO 2 capture options Biogas or other biogenic processes - Utilisation of existing CO 2 CarbonReUse Finland Oy - Possible co-operation between projects Ville Laitinen Kestävää kasvua ja työtäohjelma

28 Stages of the project 1. Investment for H 2 production (PEM, 4 m 3 /h, turn-key) 2. Integration analysis of H 2 production with different CO 2 sources and synthesis unit 3. Demonstration activities: a. SNG production in biogas processes b. Liquid and solid hydrocarbons within biogenic CO 2 sources, e.g bio-chp or bioethanol production 4. Feasibility studies of different products and markets 5. Business opportunity analyses 6. Dissemination and company activation Kestävää kasvua ja työtäohjelma

29 Thank you for your attention! Kestävää kasvua ja työtäohjelma