Conference Paper

Economics of Global Gas-To-Liquids (GtL) Fuels Trading Based on Hybrid Pv-Wind Power Plants

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Abstract

With growing demand for transportation fuels such as diesel and concerns about climate change, this paper introduces a new value chain design for transportation fuels and a respective business case taking into account hybrid PV-Wind power plants. The value chain is based on renewable electricity (RE) converted by power-togas (PtG) facilities into synthetic natural gas (SNG), which is finally converted to mainly diesel in gas-to-liquid (GtL) facilities. This RE-diesel can be shipped to everywhere in the world. The calculations for the hybrid PV-Wind power plants, electrolysis and methanation are done based on annual full load hours (FLh). A combination of 5 GWp single-axis tracking PV and wind power have been applied. Results show that the proposed RE-diesel value chain is competitive for crude oil prices within a minimum price range of about 121-191 USD/barrel (0.67 – 1.06 €/l of diesel production cost), depending on assumptions for cost of capital, available oxygen sales and CO2 emission costs. RE-diesel is competitive with conventional diesel from an economic perspective, while removing environmental concerns. The cost range would be an upper limit for the conventional diesel price in the long-term and RE-diesel can become competitive whenever the fossil fuel prices are higher than the level mentioned and the cost assumptions expected for the year 2030 are achieved. A sensitivity analysis indicates that the RE-PtG-GtL value chain needs to be located at the best complemented solar and wind sites in the world combined with a de-risking strategy and a special focus on mid to long term electrolyzer efficiency improvements. The substitution of fossil fuels by hybrid PV-Wind power plants could create a PV-wind market potential in the order of terawatts.

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... By using solar photovoltaic (PV) and wind energy based renewable electricity (RE) as the source of primary energy, RE-based fuels, such as RE-diesel can be produced to overcome the constraints of resource limitation and CO 2 emissions in the conventional value chain. There are several technical options to produce hydrocarbon fuels based on hybrid PV-wind plants for the transport and mobility sector: mainly RE-PtG [6], liquefied natural gas (LNG) based on RE-PtG [10], RE-PtG-GtL [11] and RE-PtL. All options can be used to buffer and store intermittent renewable electricity. ...
... In case of the SOEC application, the steam out of the FT unit can be directly used in the SOEC. More details on the characteristics of different types of FT synthesis are described by Fasihi et al. [11] ...
... Table 7shows all the assumptions for the specifications of the hydrogen to liquids (H 2 tL) plant in the model used in this paper. In the absence of solid numbers for H 2 tL plant in the literature review, the specification have been calculated by combining the technologies and cost breakdowns presented by Maitlis and Klerk [42], König et al. [8] and Fasihi et al. [11]. Table 7. Base case specification of a hypothetical H2tL (RWGS, FT and hydrocracking) plant assumed for this paper. ...
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This paper introduces a value chain design for transportation fuels and a respective business case taking into account hybrid PV-Wind power plants, electrolysis and hydrogen-to-liquids (H2tL) based on hourly resolved full load hours (FLh). The value chain is based on renewable electricity (RE) converted by power-to-liquids (PtL) facilities into synthetic fuels, mainly diesel. Results show that the proposed RE-diesel value chains are competitive for crude oil prices within a minimum price range of about 79 - 135 USD/barrel (0.44 – 0.75 €/l of diesel production cost), depending on the chosen specific value chain and assumptions for cost of capital, available oxygen sales and CO2 emission costs. A sensitivity analysis indicates that the RE-PtL value chain needs to be located at the best complementing solar and wind sites in the world combined with a de-risking strategy and a special focus on mid to long-term electrolyser and H2tL efficiency improvements. The substitution of fossil fuels by hybrid PV-Wind power plants could create a PV-wind market potential in the order of terawatts.
... There are several technical options to produce hydrocarbon fuels based on hybrid PV-Wind plants for the transport and mobility sector: mainly RE-PtG (), liquefied natural gas (LNG) based on RE-PtG (Fasihi et al., 2015a), RE-PtG-GtL (Fasihi et al., 2015b) and RE-PtL (Fasihi et al., 2016). All options can be used to buffer and store intermittent renewable electricity. ...
... There are different reforming technologies to produce syngas from natural gas, explained by Fasihi et al. (2015b). Catalytic partial oxidation (CPO) (Eq. 12), provides the syngas with the desired CO:H2 ratio for the FT process, but air separation units (ASU) are needed to produce the required oxygen for this reaction. The cost of an air separation unit is reported to be at least 8% of the capital cost of GtL facilities (Maitlis and Klerk, 2013). CPO: ...
... The 30 year average ratio of LNG price in Japan to crude oil price is 102.3% (Fasihi et al. 2015a) and the 13 year average ratio of one barrel of diesel cost (crude oil consumption and refinery cost) to crude oil price is 118.76% (Fasihi et al., 2015b). For a WACC of 7% in the base scenario, the cost of debt and return on equity are 5% and 12%, respectively, with a debt to equity ratio of 70:30. ...
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With growing demand for LNG and transportation fuels such as diesel, and concerns about climate change and emission cost, this paper introduces new value chain design for LNG and transportation fuels and respective business cases for Iran, taking into account hybrid PV-Wind power plants. The value chains are based on renewable electricity (RE) converted by power-togas (PtG) or power-to-liquids (PtL) facilities into SNG (which is finally liquefied into LNG) or synthetic liquid fuels, mainly diesel, respectively. The RE-LNG or RE-diesel can be shipped to everywhere in the world. The calculations for the hybrid PV-Wind power plants, electrolysis, methanation (H2tSNG) and hydrogen-to-liquids (H2tL) are done based on both annual full load hours (FLh) and hourly analysis. Results show that the proposed RE-LNG or RE-diesel value chains are competitive for crude oil prices within a minimum price range of about 118-187 USD/barrel (24 – 31 USD/MBtu of LNG production cost) and 102-168 USD/barrel (0.68 – 0.86 €/l of diesel production cost), depending on the chosen specific value chain and assumptions for cost of capital, available oxygen sales and CO2 emission costs. RE-LNG or RE-diesel could become competitive to conventional fuels from an economic perspective, while removing environmental concerns. The RE-PtX value chain needs to be located at the best complementing solar and wind sites in the world combined with a de-risking strategy. This could be an opportunity for Iran to use its abundant source of solar and wind and the available conventional fossil fuel transportation infrastructure to export carbon neutral hydrocarbons around the world where the environmental limitations on conventional hydrocarbons is getting tighter and tighter.
... There are several technical options to produce hydrocarbon fuels based on hybrid PV-wind plants for the transport and mobility sector: mainly RE-PtG (Breyer et al., 2015), liquefied natural gas (LNG) based on RE-PtG (Fasihi et al., 2015a), RE-PtG-GtL (Fasihi et al., 2015b) and RE-PtL. All options can be used to buffer and store intermittent renewable electricity. ...
... In case of the SOEC application, the steam out of the FT unit can be directly used in the SOEC. More details on the characteristics of different types of FT synthesis are described by Fasihi et al. (2015b). Fischer-Tropsch Synthesis (FTS): n CO + 2n H2 → (-CH2-)n + n H2O ∆H 0 = -209 kJ/mol (Eq. ...
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With growing demand for transportation fuels such as diesel and concerns about climate change, this paper introduces a new value chain design for transportation fuels and a respective business case taking into account hybrid PV-Wind power plants. The value chain is based on renewable electricity (RE) converted by power-to-liquids (PtL) facilities into synthetic fuels, mainly diesel. This RE-diesel can be shipped to everywhere in the world. The calculations for the hybrid PV-Wind power plants, electrolysis and hydrogen-to-liquids (H2tL) are done based on annual full load hours (FLh). A combination of 5 GWp PV single-axis tracking and wind onshore power have been applied. Results show that the proposed RE-diesel value chains are competitive for crude oil prices within a minimum price range of about 79-135 USD/barrel (0.44 – 0.75 €/l of diesel production cost), depending on the chosen specific value chain and assumptions for cost of capital, available oxygen sales and CO2 emission costs. RE-diesel could become competitive to conventional diesel from an economic perspective, while removing environmental concerns. The cost range would be an upper limit for the conventional diesel price in the long-term and RE-diesel can become competitive whenever the fossil fuel prices are higher than the level mentioned and the cost assumptions expected for the year 2030 are achieved. A sensitivity analysis indicates that the RE-PtL value chain needs to be located at the best complementing solar and wind sites in the world combined with a de-risking strategy and a special focus on mid to long-term electrolyser and H2tL efficiency improvements. The substitution of fossil fuels by hybrid PV-Wind power plants could create a PV-wind market potential in the order of terawatts.
... This power-to-fuel value chain, along with all sustainable fuels, is shown in Fig. 7. Conversely, EnergyPLAN utilises a power-to-gas-to-liquid (PtGtL) route in a Chemical Synthesis function although the most recent version of EnergyPLAN can model the PtL route. To most closely model the FT synthesis process, which is more efficient than the PtGtL process [84,85], efficiencies and costs were adjusted to most closely follow the power-to-liquid process. However, one aspect that cannot be properly adjusted between the models is the amount of CO 2 that needs to be captured and the amount of electricity needed for the process because of the different CO 2 demands for the respective functions. ...
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As the discourse surrounding 100% renewable energy systems has evolved, several energy system modelling tools have been developed to demonstrate the technical feasibility and economic viability of fully sustainable, sector coupled energy systems. While the characteristics of these tools vary among each other, their purpose remains consistent in integrating renewable energy technologies into future energy systems. This paper examines two such energy system models, the LUT Energy System Transition model, an optimisation model, and the EnergyPLAN simulation tool, a simulation model, and develops cost-optimal scenarios under identical assumptions. This paper further analyses different novel modelling approaches used by modellers. Scenarios are developed using the LUT model for Sun Belt countries, for the case of Bolivia, to examine the effects of multi and single-node structuring, and the effects of overnight and energy transition scenarios are analysed. Results for all scenarios indicate a solar PV dominated energy system; however, limitations arise in the sector coupling capabilities in EnergyPLAN, leading it to have noticeably higher annualised costs compared to the single-node scenario from the LUT model despite similar primary levelised costs of electricity. Multi-nodal results reveal that for countries with rich solar resources, high transmission from regions of best solar resources adds little value compared to fully decentralised systems. Finally, compared to the overnight scenarios, transition scenarios demonstrate the impact of considering legacy energy systems in sustainable energy system analyses.
... As such, EnergyPLAN users must first produce synthetic grid gas and then convert that to a synthetic liquid fuel in a Power-to-Gas-to-Liquid process. However, direct conversion of electricity into liquids in a Power-to-Liquid process such as Fischer-Tropsch synthesis is efficient and less expensive [31,32] thereby making scenarios with synthetic fuel production more attractive. ...
... In addition, gas-fired power plants are given a slightly positive factor also because they offer a higher efficiency (significantly higher when in combined cycle setup) and the least amount of CO 2 emissions and heavy metals from the fossil-fueled technologies. The factor for oil-fired power plants reflects still the high flexibility in operation and fuel intake, as it can use biofuels or synthetic fuels such as FT-diesel (Fasihi et al., 2015a), but also the rather high level of heavy metal and CO 2 emissions (Fthenakis and Kim, 2011). ...
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Poster on the occasion of the 4th Conference on Carbon Dioxide as Feedstock for Fuels, Chemistry and Polymers in Essen, Germany, on September 29 - 30, 2015.
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This paper reports on an investigation of the cost-effectiveness of selected design risk control options considered for improved environmental protection from the operation of crude oil tankers. The analysis has been carried out for representative Panamax, Aframax, Suezmax and VLCC tankers and elaborates on design modifications for enhanced cargo tank subdivisions, increased double bottom height and increased side tank width with the view to establish cost-effective trade-offs between oil outflow reduction and associated life-cycle implementation costs for new-buildings. The results demonstrate the applicability of the investigated risk control options and their potential contribution to reduced oil spills.
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Gas-to-Liquids (GTL) technology converts natural gas, through Fischer–Tropsch synthesis, into liquid and ultra-clean hydrocarbons such as light oils, kerosene, naphtha, diesel, and wax. Bolivia has natural gas reserves that reach 48.7 trillion cubic feet and produces nearly 40.0 million cubic meters per day, from which, around 88% are exported to Brazil and Argentina. In spite of these considerable amounts of natural gas reserves and production, the country experiences a shortage of diesel which cannot be solved using conventional refining processes due the light nature of its crude oil. Thus, the GTL process seems to be a promising solution for Bolivia’s diesel problems, at the same time that its natural gas reserves could be monetized. Although GTL can be considered as a well proven and developed technology, there are several aspects along the main processing steps (synthesis gas generation, Fischer–Tropsch synthesis, and product upgrading) to be considered at the time of implementing a GTL plant. The aim of this paper is to give an overall view of some relevant issues related to Gas-to-Liquids technology as an option for natural gas industrialization in Bolivia, and also to provide a landscape of Bolivian natural gas industry.Research highlights► The GTL process has become an alternative to address the diesel shortage in Bolivia and its implementation is in accordance with the guidelines and perspectives of hydrocarbon industry in the country. ► The startup of two GTL plants is projected, in 2015 and 2021, respectively, each one with a capacity of 15,000 bpd. These plants will be located in the Bolivian Gran Chaco and natural gas consumption for each plant will be near 4.5 MMcmd, demanding up to 1.3 TCF of natural gas in 25 years. ► Considering that the country has almost no experience in this kind of processes, implementation of this type of technology should be planned and carried out carefully.
Article
To improve the sustainability of transportation, a major goal is the replacement of conventional petroleum-based fuels with more sustainable fuels that can be used in the existing infrastructure (fuel distribution and vehicles). While fossil-derived synthetic fuels (e.g. coal derived liquid fuels) and biofuels have received the most attention, similar hydrocarbons can be produced without using fossil fuels or biomass. Using renewable and/or nuclear energy, carbon dioxide and water can be recycled into liquid hydrocarbon fuels in non-biological processes which remove oxygen from CO2 and H2O (the reverse of fuel combustion). Capture of CO2 from the atmosphere would enable a closed-loop carbon-neutral fuel cycle. This article critically reviews the many possible technological pathways for recycling CO2 into fuels using renewable or nuclear energy, considering three stages--CO2 capture, H2O and CO2 dissociation, and fuel synthesis. Dissociation methods include thermolysis, thermochemical cycles, electrolysis, and photoelectrolysis of CO2 and/or H2O. High temperature co-electrolysis of H2O and CO2 makes very efficient use of electricity and heat (near-100% electricity-to-syngas efficiency), provides high reaction rates, and directly produces syngas (CO/H2 mixture) for use in conventional catalytic fuel synthesis reactors. Capturing CO2 from the atmosphere using a solid sorbent, electrolyzing H2O and CO2 in solid oxide electrolysis cells to yield syngas, and converting the syngas to gasoline or diesel by Fischer-Tropsch synthesis is identified as one of the most promising, feasible routes. An analysis of the energy balance and economics of this CO2 recycling process is presented. We estimate that the full system can feasibly operate at 70% electricity-to-liquid fuel efficiency (higher heating value basis) and the price of electricity needed to produce synthetic gasoline at U.S.D$ 2/gal ($ 0.53/L) is 2-3 U.S. cents/kWh. For $ 3/gal ($ 0.78/L) gasoline, electricity at 4-5 cents/kWh is needed. In some regions that have inexpensive renewable electricity, such as Iceland, fuel production may already be economical. The dominant costs of the process are the electricity cost and the capital cost of the electrolyzer, and this capital cost is significantly increased when operating intermittently (on renewable power sources such as solar and wind). The potential of this CO2 recycling process is assessed, in terms of what technological progress is needed to achieve large-scale, economically competitive production of sustainable fuels by this method.
Article
Gas-to-liquid (GTL) involves the chemical conversion of natural gas into synthetic crude that can be upgraded and separated into different useful hydrocarbon fractions including liquid transportation fuels. Such technology can also be used to convert other abundant natural resources such as coal and biomass to fuels and value added chemicals (referred to as coal-to-liquid (CTL) and biomass-to-liquid (BTL)). A leading GTL technology is the Fischer–Tropsch (FT) process. The objective of this work is to provide a techno-economic analysis of the GTL process and to identify optimization and integration opportunities for cost saving and reduction of energy usage while accounting for the environmental impact. First, a base-case flowsheet is synthesized to include the key processing steps of the plant. Then, a computer-aided process simulation is carried out to determine the key mass and energy flows, performance criteria, and equipment specifications. Next, energy and mass integration studies are performed to address the following items: (a) heating and cooling utilities, (b) combined heat and power (process cogeneration), (c) management of process water, (c) optimization of tail gas allocation, and (d) recovery of catalyst-supporting hydrocarbon solvents. Finally, these integration studies are conducted and the results are documented in terms of conserving energy and mass resources as well as providing economic impact. Finally, an economic analysis is undertaken to determine the plant capacity needed to achieve the break-even point and to estimate the return on investment for the base-case study.
Article
The syngas based routes are efficient, but still expensive. The presentation summarizes the state of art and analyzes the constraints of the technology, and the role of the catalyst. Recent studies have led to a better understanding of the mechanism. The coverage of carbidic carbon which is the precursor for forming whisker carbon is determined by the methane dissociation as well as the availability of surface oxygen. There is evidence that both reactions can be influenced by the composition of the catalyst.
Article
This paper presents a comprehensive methodology for evaluating the economic attractiveness of gas-to-liquid (GTL) technology in a gas rich country like Qatar. The Qatari gas volume needed to fully satisfy the projected long-term market demand of GTL products (mainly diesel oil) in the Asia-Pacific region is evaluated. Based on the state-of-the-art GTL technology, the number, size and the commissioning dates of GTL plants required for that purpose are determined along with the associated investment and running costs. The economic attractiveness of GTL investment is evaluated based on the internal rate of return, and the impact of adopting large-scale GTL projects on Qatar oil refining industry is assessed. Sensitivity analyses are conducted using several scenarios to account for variations in GTL premium, capital cost, operation and maintenance cost and cost of gas feedstock.
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