MefCO2 Final dissemination event

Technology Roadmap

Benedikt Stefansson, Director of Business Development, CRI

28th May, 2019

MefCO2 – Methanol fuel from CO2

Outline

1. Under what conditions can CO2-to-methanol technology be applied commercially today?

2. What are the main challenges for the commercialization of CO2-to-metanol technology?

3. How does policy influence the development of CO2-to-methanol technology?

MefCO2 – Methanol fuel from CO2

Can CO2-to-methanol technology be applied today?

Challenging underlying assumptions of techno-economic evaluations

JRC on CO2-to-fuel 2017

Too expensive

M. Perez-Fortes and E. Tzimas; Techno-economic

and environmental evaluation of carbon dioxide

utilisation for fuel production. Synthesis of methanol

and formic acid; EUR 27629 EN; doi: 10.2790/981669

Abanades et.al. on CCU 2018

Use RES for EV directly

Abanades et. al “On the climate change mitigation

potential of CO2 conversion to fuels” Energy

Environ. Sci., 2017, 10, 2491

Copyright of Shell

CHEM ICAL PTL SYN THESIS PATHWAYS

Shell Germany CTO on PtL 2018

Must convert to drop-in fuel

Warnecke W. “Fuels Options for Large Engines –

Today & Tomorrow” Shell 2018

MefCO2 – Methanol fuel from CO2

Can CO2-to-methanol technology be applied today?

Challenging underlying assumptions of techno-economic evaluations

JRC on CO2-to-fuel 2017 Abanades et.al. on CCU 2018 Shell Germany CTO on PtL 2018

Too expensive Use RES for EV directly Must convert to drop-in fuel

Based on average

retrospective prices for

electricity and cost of

capture

Opportunities exist to reduce

these costs significantly

Assumes that RES is not

additional and that EVs

can deliver all needed

mobility services

Where residual grid mix is

green and EV is not

competitive based on range

and weight: CO2-to-methanol

is greener option

Assumes that methanol

will not be accepted by

market and kills the

business case due to cost

of reforming and F-T

Both methanol and C1

derivatives (no F-T or

reforming) already used

successfully in automotive

and marine applications

MefCO2 – Methanol fuel from CO2

Where can CO2-to-methanol technology be applied today?

Affordable H2 Affordable CO2 capture Profitable market for product

• H2 from green source

• Surplus green electricity

• From flare gas

• Concentrated CO2

• Existing CO2 capture system

• RFNBO accepted as

advanced renewable fuel

• Recycled carbon fuel

accepted

• Existing chemicals market with

premium for CO2 intensity

European Commission

and MS must ASAP

resolve regulations on

CO2 accounting of

different H2 sources

Who is responsible and

pays the cost of capture

and how does incentives

for CCU interact with the

ETC and tax system?

Consistent transposition

in EU Member States

crucial for fuel market.

Incentives to defossilize

chemical industry?

MefCO2 – Methanol fuel from CO2

Cost advantage compared to other advanced fuels

0 200 400 600 800 1000 1200 1400 1600 1800

Ethanol from gasification of MSW

Diesel from algae

Ethanol from fermented cellulose

FT-diesel from biomass gasification

Ethanol from blast-oven furnace gas

Diesel from pyrolysis

CRI methanol from CO2 with electrolysis

€1800/t*

OPEX €/t* CAPEX €/t*

*Ton methanol equivalent Source: Ländalv, I et.al. (2017) “Building up the future: Cost of Biofuel” European Commission / ART Fuel Forum

Product and pathway Company Commercial scale

CRI

Fortum

LanzaTech

Dupont, St1

Exxon

Enerkem

MefCO2 – Methanol fuel from CO2

Framework to think about cost drivers

0

140

280

420

560

700

840

980

1120

0

20

40

60

80

100

120

140

160

180

200

0 10 20 30 40 50 60 70 80

CAPEX ~€1500/t/yr

Capture 7%

Electrolysis 45%

BOP 48%

OPEX

Energy: €MWh/𝜂Other: ~€100/t

CO2 capture 0%

Other 75%

Labor 25%

MCOPEXCAPEX

€/MWh MeOH €/t MeOH

€80/MWh energy

Strawman example

Efficiency

Energy cost

MefCO2 – Methanol fuel from CO2

Cost drivers impacting large-scale commercial roll-out

Operating costs (OPEX)

Focus on:

- Developing standardized CO2 capture systems for typical waste gas streams

- Reach optimal efficiency of alkaline electrolysis systems

- improve from 60-70% to >85%?

- Continue to improve

- synthesis system

- catalysts active at lower temperature

- heat integration

MefCO2 – Methanol fuel from CO2

Main opportunities for reducing CAPEX

Potential impact of future development effort

Technology TRL On cost On efficiency

CO2 capture Amines (1st gen)

Carbonate formation

Rectisol & Selexol

Membranes

Amines (2nd gen)

Direct air capture

Calcium looping

9

9

9

7

6

5

4

Low

High

Moderate

Moderate

Moderate

High

Low

Low

Low

Low

Moderate

Moderate

Moderate

Moderate

Electrolysis Alkaline

PEM

Solid Oxide

8

7

4

High

High

High

Moderate

Moderate

High

Reaction Compression

Reactor loop design

Catalyst design

Purification

9

9

8

8

Moderate

Moderate

Moderate

Moderate

Low

Low

Low

Moderate

MefCO2 – Methanol fuel from CO2

Cost drivers impacting large-scale commercial roll-out

Operating costs (CAPEX)

Focus on:

- Reaching larger scale to exploit scale economy

- Bring down cost by replicating standard modules and systems

- Mass production of large alkaline electrolyzers

- Reliable, efficient PEM/SOC (potential higher efficiency)

- Standardize and reduce cost of capture for low concentration flue gas

- Major breakthrough to lower capital intensity of direct air capture?

MefCO2 – Methanol fuel from CO2

How does policy influence this technology?

Incentives, sustainability criteria and market access play a major role

Incentives: Lower carbon intensity must be valued by policy & market

Sustainability criteria: Common rules needed to calculate CO2 footprint

Market access: E-fuels need to be well defined in member state policy

CCU/CCS: Infrastructure subsidized and incentives with CCU also in mind

Development of generation & grid: Utilize balancing potential

MefCO2 – Methanol fuel from CO2

Summary

1. Conditions to deploy CO2-to-methanol technology commercially and sell e-methanol profitably

2. Commercial deployment will help to push technology development which should be focused on

• Mass produced MW-scale electrolysis

• CO2 capture adapted to standard flue gas streams

• Mass production of standardized and modular CO2-to-methanol systems

3. CAPEX reduction, OPEX reduction and efficiency improvement will increase interest

4. Policy has major impact on development, through market access and competitive playing field

This project has received funding from the European Union’s Horizon

2020 research and innovation programme under grant agreement

No 637016.

Thank you