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Carbon‐Negative Energy
Renewable Hydrogen Project An Opportunity for California December 2019
.. CLEAN ENERGY SYSTEMS
• •••.,~,N1••••~••:••: ·.:-.:~;:~•;;•:•·
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. . . . CARBON NEGATIVE ENERGY WHAT IS CNE? • Carbon removal refers to any process or system capable of removing and sequestering carbon from the air over its life cycle
• CNE (or BioCCS) refers to any bioenergy process that captures and permanently stores carbon safely underground through carbon capture and storage (CCS) – Indirect Air Capture
• CNE can remove the harmful greenhouse gas carbon dioxide (CO2) from the atmosphere while producing electricity and clean, renewable hydrogen
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. . . . CNE l HOW IT WORKS
CES Carbon Negative Energy (CNE) plants use waste biomass fuels that are gasified to produce a synthesis gas. This “syngas” is then used to produce renewable hydrogen (RH2), and/or electricity with full carbon capture using proprietary oxy‐combustion technology
SIMPLIFIED SCHEMATIC
Nitrogen CES Equipment
Commercially Available Equipment
Captured CO2
Electricity
Carbon Dioxide (C02) Greenhouse Gas
Air
Oxygen
Syngas
Hydrogen Depleted Syngas
CES Power Block
Air Separation
Renewable Hydrogen
Gas Separation Waste
Biomass Gasifier H2
Safely and permanently stored
Existing infrastructure can be used for now negative emissions vehicles
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•• •••••• • ENERGY ··••••• SYSTEMS
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Electrical Generator
. . . . CNE l CES POWER BLOCK
Air Separation
Unit
Cond.
OFT‐J79
O2
Fuel
Recycle Water
CO2
Excess Water
Technologies*
C.W.
HX
Direct Steam Gas Generator
Fuel Processing
Permanent sequestration,
or sold for use in EOR
CES 12” DSGG; Installed and tested at KPP
CES OFT‐J79; Installed and tested at KPP
CO2
Recovery
*See www.CleanEnergySystems.com for info on CES technologies 4
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C -6.0 0 -7.5 ..c ... • -8.75 C'O -8.0 u • -10
C: ·--10.0 C 0 • -12.5 +:-12.0 • u istoric Compliance Targets (black solid line) -13.75 :::, ~-14.0
• a: eported % Cl Reduction (green line) -16.25
~-16.0 • -17.5 QI
~-18.0 • Future Compliance Targets (black dotted line) • -18.75
QI • -20 0. -20.0
Monthly LCFS Credit Price and Transaction Volume $250 2,500,000
■ Volume of Credits Transacted (MT)
- ARB Monthty Average Oedit Pr ice
$200 - Argus Media Month ly Index Oedit Pr ice 2,000,000 ~
- OPIS Monthly Average Oedit Price 0 u - ..
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J FMAMJ JASOND JFMAMJ J ASOND JFMAMJ J ASOND J FMAMJ JASOND JFMAMJ J ASOND JFMAMJ JASOND JFMAMJ 2013 2014 201S 2016 2017 2018 2019
last Updated 7/10/2019
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. . . . CNE: WHY NOW? ECONOMICS California’s Declining Carbon Intensity Curve
Revenues have increased from $20 to $250/tonne for Carbon Capture in select markets • Value Proposition for CCS projects today:
o Renewable Hydrogen sales at avoided cost o Federal Tax Credit (45Q); increased from $20 to
$50/tonne CO2 in 2018 o California’s Low Carbon Fuel Standard (LCFS); credit prices
exceeding $190/tonne
• Concurrently, the Biomass Power industry in California has collapsed due to competition from wind and solar
o Stranded assets may be used for alternative purposes o Feedstock pricing collapse; long‐term contracts available
• Required CES capture tech. ready for commercial deployment o More than 25 years and $135 million invested
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CLEAN ENERGY SYSTEMS ... -)':::E~:;;:~/ ••••••
. . . . CNE I OPPORTUNITES FOR CALIFORNIA
TODAY → TOMORROW • Half the state’s biomass plants shu ered → All biomass plants repurposed and life extended
• Criteria pollutants from biomass plants → Near‐zero atmospheric emissions
• Open field burning of agricultural waste →
Ag. waste used to produce renewable hydrogen
• Natural gas is used to make hydrogen → Renewable hydrogen from ag. and green waste
• Tree mortality and wild fire crisis → Beneficial use of cleared forestry waste
• Current biomass plants consume water → CNE plants are net producers of water
• Water shortages in the Central Valley → Brackish water can be processed with waste heat
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8 •r/1 4 ·c: ,o -,0 ·;: 3 ·,Qj
E £ 2 ,_ IClil
Estiimated C·0 2 Storage Resourc,e: Calif'ornia Sedi1mentary Basins
• Low Estimate
■Hi01 hi Estim~te
30-460 1G1t onshore sal ine formation cap aciity 3.3-5 .. 7 1G1t natu ra l •gas reservoir capacity 1.4-3 .. 7 1G1t oil reservoiir capacity
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.. CLEAN ENERGY SYSTEMS
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. . . . CNE l POTENTIAL FOR CCS IN CALIFORNIA
California Offers Very Large CO2 Storage Capacity:
• California’s on‐shore sedimentary have capacity for roughly 1,000 years of current CO2 emissions (point source)
• The largest storage capacity identified in the state’s Central Valley basin
Courtesy of the California Energy Commission 7
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Facility Status
Idle
Facility Type
Standalone Generator
Cogeneration
Other Reserves
Natural Gas Field
Oil Field
. . . . CNE I POTENTIAL FOR BioCCS IN CALIFORNIA • More than 15 idle biomass power plants in California today (>375 MW), with more anticipated to close in the coming years
• Excellent overlay of plant locations with CCS storage sites
• Suitable for delivery to state refineries or the Hydrogen Highway
Sedimentary Basin Status
Basin with Carbon Sequestration Potential Basins lacking Carbon Sequestration Potential Offshore Basins with Unkow Carbon Sequestration Potential
Courtesy of WESTCARB 8
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. . . . CNE DEPLOYMENT I HOW TO ACCELERATE?
1. Fast‐track approval of CCS projects
• Resolution of permanence storage protocol
• Coordination between state agencies and US EPA
2. Greater flexibility in LCFS pathway calculations/monetization/eligibility
• Currently results in a fixed CI, whereas CNE projects may have variable CI attributes
• Increased trading/monetization opportunities
• More favorable interpretation of the regulations
3. Predictability of LCFS pricing to support project financing
• A floor price is optimal, but highly problematic
• Opportunities through the Pollution Control Tax‐Exempt Bond Financing Program
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. . . . CES DEPLOYMENT I ENVIRONMENTAL IMPACT • CES plans to deploy a fleet of CNE plants across California by retrofitting
existing, idled biomass facilities
• First plants will be deployed in the Central Valley; CES has site control for the first four plants to be deployed by 2025
• Significant fuel production and environmental benefits for the state by replicating and scaling CNE plants
First Four CNE Plants Future Potential 2022‐2025 2025+
Fuel Production (tonne/day) RH2 Produced 33 425 Emissions Avoided (tonne/yr) CO2 Captured & Avoided 1,300,000 16,200,000 NOx Avoided 2,400 29,900 Particulates Avoided 5,100 64,100
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For more information, please contact: Keith L. Pronske, President and CEO KLPronske@CleanEnergySystems.com Office: +1 916‐638‐7967 Or visit us at: www.CleanEnergySystems.com
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