Paving the way for Renewable Power-to-Gas (P2G)iea-retd.org/documents/2016/09/iea-retd-p2g-presentation-de-jager... · to alternative mobility options on a given market segment 1)

Paving the way forRenewable Power-to-Gas (P2G)

The case of non-individual transport

David de Jager

Operating Agent IEA RETD TCP

Revitalising local economies with renewable energy

Koriyama-city, Fukushima, Japan

1 September 2016

www.iea-retd.org 2

Research questions: Which P2G technologies are promising? Which policy instruments are required for their uptake?

RE-PROSUMERS

ObjectiveTo prepare a technology assessment of current and future P2G options for use in commercial vehicles

ApproachMarket analysis and total cost of ownership (TCO) modeling of P2G options compared to competitive vehicle technologies

PSG DLR, BMWI, NRCan, IEA HIA, CEA, VTT, DGEC

IB ENEA Consulting, Fraunhofer IWES

Published June 2016

Timeframe January to June 2016

RE-P2G Study

www.iea-retd.org 3

• Background / Approach

• Most promising segments

• Captive Light Duty Vehicles

• Buses

• City delivery trucks

• P2G infrastructure

• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 4

79%

9%

2% 1%

2%4% 3%

Individual passenger cars

Vans (<=3,5 t)

Trucks (3,5-7,5 t)

Trucks (7,5-14t)

Trucks (14-20 t)

Trucks (>20 t)

Buses and coaches

Non-individual / commercial sector has a 21 % share of German transport sector energy consumption

Background

Individual cars: 37 Mio, vans <= 3,5 t: 2.1 Mio. , trucks < 7.5 t: 0.24 Mio., buses: 0.078 Mio.

Vans and trucks < 7.5 tons make up about half of commercial sector’s emissions

www.iea-retd.org 6

The competitiveness of P2G-mobility was assessed compared to alternative mobility options on a given market segment

1) Qualitative analysis of market segments

• Market segments were defined as combination of vehicle types and purposes:

• E.g. City buses, coaches, captive fleets of light duty vehicles, city and rural delivery, long haul trucks, vocational trucks

• Criteria to choose the cases to be modelled:

• Applicability of air and noise pollution regulation on the market segment

• Power of public authorities on the market segment

• Share of fuel consumption of the market segment

• Competition with other alternative technologies on the market segment

• Development stage of hydrogen and SNG mobility on the market segment

2) Detailed modelling of the Total Cost of Ownership (TCO) of the P2G vehicle

• Fuel production, infrastructure, vehicle, possible financial incentives

3) Comparison with TCOs of competing options

Approach

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Overview of case studies modeled

Market segment: City delivery of goods

Electrolyser H2-RSFCEV bus

fleet

Electrolyser CNG-RSCNG bus

fleetMethanation

& compressionInjection station

Grid10MWel

1MWel

Electrolyser H2-RSFCEV city

truck

Electrolyser CNG-RSCNG city

truckMethanation &

compressionInjection station

Grid10MWel

1MWel

CO2 @ 10 bar

350 barMarket segment: City transit bus

H2 @ 10 bar H2 @ 350 bar

200 bar

CO2 @ 10 bar

H2 @ 10 bar SNG @ 60 bar

SNG @ 40-60 bar

SNG @ 200 bar

H2 @ 10 bar H2 @ 700 bar

700 bar


SNG @ 40-60 bar

SNG @ 200 bar

200 bar

Market segment: LDV Captive fleets

Electrolyser H2-RSRE-FCEV

LDV captive f.

Electrolyser CNG-RSCNG LDV captive f.

Methanation & compression

Injection station

Grid10MWel

1MWel

CO2 @ 10 bar

H2 @ 10 bar H2 @ 350 bar

350 bar


SNG @ 40-60 bar

SNG @ 200 bar

200 bar

www.iea-retd.org 9

Based on French market data and available data on powertrain technologies for the 2015 scenario

Methodology for TCO modeling 2015

Main Hypotheses:• Cost of capital: 8%• Production and Refueling station

• 100% load factor (there are enough vehicles to fully use the capacity of the P2G station)

• CAPEX: 2015 costs

• Electricity price• Wholesale price: 40€/MWh• Grid fee: 20€/MWh• Tax exemption on electricity

• Fuel prices• Diesel price: 1.21 €/l• NG price: 20.43€/MWh + 4.34€/MWh tax• BioCH4 price: 82.74€/MWh• P2G: production + delivery (€/MWhHHV)

• Travelled distances: short - long• Captive LDVs: 12,500 – 62,500 km/year• City Buses: 39,000 – 78,000 km/year• City Delivery Trucks: 16,000 – 32,000 km/year

Included in TCO calculation:• Vehicle costs:

• List price (€)• Maintenance (€/100km)• Insurance and Battery rental (for LDVs)

(€/year)

• Fuel costs• Taxes: VAT and taxes on diesel and CNG

Not included in TCO calculations:• Fuel taxes on SNG and H2• Vehicle Subsidies and Registration costs• Adblue cost for diesel vehicles• Parking and Toll costs (long distance)• Resale value• Battery charging infrastructure

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Hypotheses for 2030 scenario relative to 2015 scenario

• P2G production:

• Load Factor of P2G assets : 2000 hours (power is renewably sourced)

• Electrolyzer efficiency: +7.5%

• Electrolyzer CAPEX: -30%

• Methanation reactor CAPEX: -50%

• Compressors CAPEX: -10%

• Injection Station CAPEX: -20%

• P2G distribution

• H2 refueling stations: -40%

• Environment

• Carbon price: 100 €/tCO2 (20 €/t assumed in 2015)

Methodology for TCO modeling 2030

• Electricity price: 30€/MWhe

• Wholesale electricity price: 10€/MWhe

• Grid Fee: 20€/MWhe

• Tax exemption on electricity

• Vehicle costs:

• Diesel vehicles: constant price between 2015 and 2030

• H2 vehicles learning rates:

• 22% until 2020

• 6% between 2020 and 2030

• Battery rental for range extended vehicles: constant between 2015 and 2030

• CNG vehicles: 2030 price equal to 2015 diesel price

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• Buses



• Policy options

• Conclusions

RE-P2G

Agenda

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Most promising market segments were modelled in detail: Light Duty Vehicles (LDV), buses, and city delivery trucks

Approach

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• Captive Light Duty Vehicles (LDV)

• Buses



• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 14

On short distances, battery-electric Light Duty Vehicles (LDVs) outcompete P2G LDVs

Total Cost of Ownership (TCO) analysis 2015

37 k€ 43 k€ 50 k€

84 k€ 84 k€69 k€

45 k€

-

5

10

15

20

0 k€

60 k€

120 k€

180 k€

240 k€

Diesel LDV CNG LDV BioCH4 LDV Rangeextended LDV

Full H2LDV

SNG LDV Electric LDV

CO

2 e

mis

sio

ns

(kg/

100

km)

Tota

l Co

st o

f O

wn

ersh

ip

Short range captive light duty vehicles - Market Uptake - 2015

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis

Power grid connection

Power

Fuel

CO2 emissions

+127%

+17%

+130%+87%

+23%+35%

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For long ranges, range-extended Light Duty Vehicles (LDV) are already close to bio-methane


Share of infrastructure and electricity costs is rather low for range-extended LDVs.

Full H2 requires higher pressure tank systems and more electricity.

68 k€ 71 k€

104 k€113 k€

133 k€

200 k€

-

5

10

15

20

0 k€

60 k€

120 k€

180 k€

240 k€

Diesel LDV CNG LDV BioCH4 LDV Range extendedLDV

Full H2LDV

SNG LDV

CO

2 e

mis

sio

ns

(kg/

100

km)

Tota

l Co

st o

f O

wn

ersh

ip

Long range captive light duty vehicles - Market Uptake - 2015

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis


Power

Fuel

CO2 emissions

+67%

+5%

+54%

+98%

+197%

www.iea-retd.org 16

In 2030, range-extended and full LDV are competitive for long range uses; the TCO of SNG remains high


78 k€ 77 k€ 83 k€65 k€

83 k€

210 k€

-

5

10

15

20

0 k€

60 k€

120 k€

180 k€

240 k€

Diesel LDV CNG LDV BioCH4 LDV Range extendedLDV

Full H2LDV

SNG LDV

CO

2 e

mis

sio

ns

(kg/

100

km)

Tota

l Co

st o

f O

wn

ersh

ip

Long range captive light duty vehicles - Large scale deployment - 2030

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis


Power

Fuel

CO2 emissions

-17%-2% +6% +6%

+168%

www.iea-retd.org 17

Conclusions on LDV captive fleets

• There is a business case for range extended H2 fleets in the short run

• The most promising option is the development of long range fleets

• BEV cannot compete on these distances due to their limited ranges

• The vehicle technology is already mature but policy measures should still be targeted at reducing the cost of hydrogen vehicles through:

• Subsidies

• And or tax exemptions

• SNG would need expensive policy measures to be made competitive

• Electricity purchase conditions are not in favor of the SNG path due to its low energy efficiency

Preliminary conclusions

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• Buses



• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 19

H2 inter-city buses have a TCO about three times higher than diesel buses, mainly because of the vehicle costs

Preliminary TCO analyses 2015

591 k€ 579 k€

910 k€

1 648 k€

1 869 k€

-

40

80

120

160

0 k€

500 k€

1 000 k€

1 500 k€

2 000 k€

Diesel Bus CNG Bus BioCH4 Bus H2 Bus SNG Bus

CO

2 e

mis

sio

ns

(kg/

100k

m)

Tota

l Co

st o

f O

wn

ers

hip

Long range inter-city buses - Market Uptake - 2015

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis


Power

Fuel

CO2 emissions

-2%

+55%

+184%

+220%

www.iea-retd.org 20

By 2030 H2 buses are still 40% more expensive than diesel buses while SNG buses will remain even more expensive

Preliminary TCO analyses 2030

702 k€642 k€

706 k€

894 k€

1 974 k€

-

40

80

120

160

0 k€

500 k€

1 000 k€

1 500 k€

2 000 k€

Diesel Bus CNG Bus BioCH4 Bus H2 Bus SNG Bus

CO

2 e

mis

sio

ns

(kg/

100k

m)

Tota

l Co

st o

f O

wn

ers

hip

Long range inter-city buses – Large scale deployment - 2030

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis


Power

Fuel

CO2 emissions

-9%+1%

+39%

+198%

CO2 tax of 450€/tCO2 in 2030 would be required to make H2 buses competitive.

www.iea-retd.org 22




• Inter-city Buses

• Long-range City delivery trucks


• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 23

H2 and SNG long range delivery trucks are currently at par in terms of competitiveness

TCO analyses 2015

174 k€ 188 k€

276 k€

521 k€ 529 k€

-

25

50

75

100

0 k€

150 k€

300 k€

450 k€

600 k€

Diesel City Delivery

CNG City Delivery

BioCH4 City Delivery

H2 City Delivery SNG City Delivery

CO

2 e

mis

sio

ns

(kg/

100

km)

Tota

l Co

st o

f O

wn

ers

hip

Long range city delivery trucks - Market Uptake - 2015

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis


Power

Fuel

CO2 emissions

+8%

+58%

+199% +203%

www.iea-retd.org 24

By 2030 H2 delivery trucks are still 35% more expensive than diesel buses; SNG delivery trucks will remain very expensive

TCO analyses 2030

203 k€ 188 k€ 204 k€

272 k€

539 k€

-

25

50

75

100

0 k€

150 k€

300 k€

450 k€

600 k€

Diesel City Delivery

CNG City Delivery

BioCH4 City Delivery

H2 City Delivery SNG City Delivery

CO

2 e

mis

sio

ns

(kg/

100

km)

Tota

l Co

st o

f O

wn

ers

hip

Long range city delivery trucks - Large scale deployment - 2030

Vehicle

Refueling station

Gas Grid

Injection station

Pipeline

SNG compression

Methanation reactor

CO2

Electrolysis


Power

Fuel

CO2 emissions

-8%+1%

+34%

+165%

CO2 tax of 430€/tCO2 in 2030 would be required to make H2 trucks competitive.

www.iea-retd.org 26




• Buses



• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 27

P2G plants must operate under the double constraint of:- high load factors, and - using near to 100% renewable electricity

• A large portion of fuel costs for P2G vehicles come from production infrastructure CAPEX:

• Producing H2 during 2,000 hours/year with free electricity is more expensive than producing H2 during 8,600 hours/year with a 60€/MWh electricity

• A high load factor is thus required to limit fuel costs (typically more than 5,000 hours/year).

• At the same time, P2G emissions depend on the carbon footprint of the electricity used for electrolysis:

• P2G vehicles emit less CO2 than diesel vehicles when the carbon footprint of the electricity used is less than 180 kgCO2/MWh

Technical-economic features of P2G infrastructure

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Power-to-gas must be based on full or close to full renewable electricity.

H2 vs. SNG

0

20

40

60

80

100

120

Germany (461)

Ireland (458)

UK(457)

Japan (416)

Denmark (360)

Canada (186)

France (61)

Norway (13)

Ve

hic

le e

mis

sio

ns

In k

g o

f C

O2

/10

0km

Countries(2011 Carbon footprint of grid electricity in kg of CO2/MWh)

FCEV

SNG

Diesel

To be less emissive than diesel, grid power-to-SNG requires an electricity carbon footprint

three times lower than grid power-to-hydrogen

www.iea-retd.org 29

A very high penetration of RES is required to make renewable power-to-gas affordable in the long term

• At small scale, high load factors and renewable electricity should not be the main concern:

• Fuel costs only represent a limited portion of total costs compared to vehicle cost (even though P2G production infrastructure represents a large portion of fuel costs)

• Renewable power-to-gas can be achieved through the purchase of renewable certificates

• But when deployed at large scale, renewable P2G production becomes an issue:

• The price of renewable certificates would greatly increase due to higher demand

• With decreased vehicle costs, fuel costs become an important part of the TCO of vehicles

• P2G would add significant base demand to the grid if it ran at a 100% load factor

• P2G infrastructure should thus run on excess RES-E and play a stabilizing role for the grid. A very high penetration of RES-E is required to offer long hours of excess RES-E to maintain a sufficient load factor.


www.iea-retd.org 30

Hydrogen production tends to be decentralised while SNG can be produced in a centralised configuration

• Hydrogen should be produced as close as possible to the demand

• There is no H2 transportation infrastructure

• H2 transport by truck (tube trailer) is expensive

• Electrolysis process can be easily decentralised (modular process with limited gains on scale effect above 5 to 10MWel)

• In practice, the optimum between scale, number of production units and distance of transport to demand sites must be found for each demand area

• In most areas covered in the geographical scope of the study, SNG benefits from natural gas transportation infrastructures

• SNG production and delivery sites can be connected by the natural gas distribution and transmission grids and transport would be cost-effective


www.iea-retd.org 31

Hydrogen refuelling stations addressing several types of vehicle will maximise chances to reach economic viability

• Size and load factor significantly impact the economic viability of refueling stations (amortization of CAPEX)

• 200 kgH2/day is considered as the minimum capacity required to reach breakeven with current CAPEX

• This corresponds to an electrolyser of 500 kWel and a fleet of 500 LDVs

• Refueling stations dedicated to captive fleets or specific market segments without sufficient demand have few chances to reach breakeven

Technical-economic features of P2G for mobility

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• Buses



• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 33

P2G mobility requires an ambitious regulatory framework in favour of renewable mobility

• More ambitious constraints are needed in shares of RES in transport

• Renewable P2G mobility will hardly compete with other options (fossil, BEVs, biomethane)

• It is not likely to be the first renewable mobility option to be used to reach current targets/constraints in Europe

• Energy suppliers and vehicle manufacturers will turn to P2G technologies if constraints are high enough to make the cheapest options (diesel) insufficient to reach CO2 targets/constraints

• Renewable certificates for fuels produced from power are needed to ensure and monitor the development of fully renewable P2G

• RE targets should be set at distribution infrastructure level

• A certification scheme for renewable power-to-gas will be needed

Policy options

www.iea-retd.org 40




• Buses



• Policy options

• Conclusions

RE-P2G

Agenda

www.iea-retd.org 41

P2G can help decarbonize the transport sector – provided it relies on hydrogen and close to fully renewable electricity

• Renewable P2G mobility can hardly compete with fossil, BEVs, biomethane

• Policy support and subsidies are needed

• P2G mobility should focus on hydrogen and long ranges

• Power-to-hydrogen is more energy- and cost-efficient than power-to-SNG

• Strategy for early adoption should focus on captive fleets of LDVs

• LDVs represent the highest share of CO2 emissions after passenger cars

• Hydrogen LDVs can become competitive at an acceptable cost

• Buses and trucks do not show a viable business case even in the future

• Ambitious, binding RE transport targets required (making diesel a non-option)

• High shares of renewable electricity needed for truly renewable P2G

Conclusions

Non-individual transport can pave the way for renewable power to gas

For additional information on RETD

Online: www.iea-retd.orgContact: [email protected]

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Documents

Paving the way for Renewable Power-to-Gas (P2G)iea-retd.org/documents/2016/09/iea-retd-p2g-presentation-de-jager... · to alternative mobility options on a given market segment 1)