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12th June 2018 | Panel 4: Technology & Systems Decarbonization pathways - scenarios and electrification options - II

Concepts and pathways towards a carbon-neutral heavy industry in North -

Clemens Schneider, Stefan Lechtenböhmer, Division Future Energy and Mobility Structures North Rhine-Westphalia (NRW) Home of ‘s energy intensive industries (EII) Energy demand of EII in Germany EII sites in NRW

Beckum Marl Gelsenkirchen Geseke

Neuss

Dormagen

Köln Düren Legend industry branches paper refineries Legend chemical industry glass electricity cement steam iron & steel fuels non-ferrous metals Source: own maps. 2 Cross-border perspective: Petrochemical triangle Rotterdam – Flanders – Rhine-

Rotterdam Gelsenkirchen/ Ruhr

Antwerp Terneuzen

Cologne Geleen

Source: own map. 3 Why do we care about infrastructures?

The results presented are part of a study on behalf of European Climate Foundation (ECF) dealing with infrastructure issues in connection to the decarbonisation of heavy industry in NRW.

Hypothesis: Infrastructure matters.

Viability of heavy industry clusters strongly depends on infrastructures. Even if they need new production stocks in the course of decarbonisation today’s clusters can make worth of their existing infrastructures. Decarbonisation of heavy industries should be an important issue not only in industrial policy but also in regional policy and infrastructure planning.

4 Approach used

Two step approach: • Bottom-up scenario analysis • Infrastructure analysis

The Scenario exercise reveals prototypical pictures of a future decarbonised heavy industry in NRW. No strong ambition in direction of a circular economy.

The spatial infrastructure analysis • hints at potential relevance of single technologies and infrastructures, • discusses interdependencies between heavy industry and transport fuel supply, • allows for the discussion of potential clustering of sites

5 Prototypical2X scenarios Electrification

direct electrification

The other crucial strategies: • energy efficiency • material efficiency / circular economy • biomass

Circularity iCCS / / Material end CCSof pipe efficiencyP2X

9. März 2018 LCI NRW Lechtenböhmer 1-20186 Three prototypical scenarios

iCCS PtX Import all-electric

synthetic fuels TRANSPORT biofuels electric motors import

BUILDINGS mixed system: heat pumps, decentralised CHP, bio etc.

H-DRI STEEL +CCS H-DRI (H2 import)

Steam PtC via methanol PtC via PLASTICS Cracking+CCS (import) methanol

INDUSTRY fossil fuel + electric ovens OVENS CCS biomethane (import) fossil+CCS / STEAM PtH biomethane

7 Prototypical2X scenarios Electrification

direct electrification

all- electric

P2X ICCS Circularity iCCS / / Material end CCSof pipe efficiencyP2X

9. März 2018 LCI NRW Lechtenböhmer 1-20188 Scenario analysis: Energy needed Primary energy balance of the scenarios (electricity is regarded as PE here)

hard"coal"

lignite" all=electric" crude"oil"(products)" P2X"incl."indirect*)" natural"gas" P2X"

2050" biomass"

ICCS"incl."indirect*)" electricity"

ICCS" hydrogen"

syntheIc"hydrocarbon" fuels" indirect"electricity"

290 PJ of feedstock use demand"(abroad)"

EB"NRW" 2014"

0" 500" 1"000" 1"500" 2"000" 2"500" 3"000" 3"500" *)"indirect"PE"use" PJ/a% outside"NRW" Source: own figure, derived from IT.NRW (2017) and own calculations.

9 Infrastructure analysis

10 Existing infrastructures in NRW

Legend natural gas pipeline propylene pipeline ethylene pipeline crude oil pipeline oil product pipeline Sites (industry branches) Paper industry Refineries Chemical industry Glass industry Cement Iron & steel Source: own map. Non-ferrous metals 11 Infrastructure needs for import/export NRW net balance electricity

Net exchange increases in all scenarios (but maximum extension of generation capacities within NRW assumed) At least in the all-electric scenario massive grid investments needed! (but less in the sensitivity) all!electric$+$P2X$import$ 11 GW sensitivity all!electric$ 40 GW

P2X$ 290 PJ feedstock electricity$ ICCS$use

today$

!200$ !100$ 0$ 100$ 200$ 300$ 400$ TWh/a&

Source: own figure based on IT.NRW (2017) and own calculations. 12 Infrastructure needs for import/export NRW net balance liquid energy carriers

Only little shortages indicated

Conversion od crude oil pipelines could be needed if methanol would be the import carrier (instead of e.g. blue crude)

all3electric"+"P2X" crude"oil"

import" sensitivity all3electric" naphtha"and"other" oil"products" P2X" 290 PJ biodiesel" feedstock ICCS" use methanol" today"

0" 10" 20" 30" 40" 50" kerosene" Mt/a%

Source: own figure based on IT.NRW (2017) and own calculations. 13 Infrastructure needs for import/export NRW net balance for gas imports

P2X: new H2 pipeline required (conversion of natural gas pipes?)

iCCS: CO2 transport pipe required?

all!electric$+$P2X$

import$ sensitivity all!electric$ natural$gas$ P2X$ 290 PJ bio!methane$ feedstock ICCS$ use hydrogen$

today$ CO2$

!40$ !20$ 0$ 20$ 40$ 60$ billion&m3/a&

Source: own figure based on IT.NRW (2017) and own calculations. 14 Infrastructure needs for import/export today vs. future Hydrogen in the P2X scenario TODAY 2050+ 29 Bill. Nm3/a hydrogen (equals 290 Mill. m3 at 100 bar)

Scenario „PtX-IMPORT“ Hydrogen sinks: • Steel industry at Duisburg (26 Bill. Nm3/a) today‘s maximum • Chemical industry exchange capacity: ca. 300 Mill. Nm3/a

100 cm

10 cm

Source: own map. 15 Infrastructure needs for import/export today vs. future Hydrogen in the P2X scenario

Netherlands Rotterdam NRW 200#km# Gelsenkirchen

Duisburg Antwerp River Rhine

Cologne

Belgium

Germany France

Source: own map. 16 Infrastructure needs for import/export today vs. future

CO2 in the iCCS scenario

3 90$km$ 25 Bill. Nm CO2 250$km$ 3 NRW (equals 230 Mill. m Rotterdam at 110 bar) Gelsenkirchen 150$km$ Duisburg à But is export really 50$km$ Antwerp River Rhine necessary?

Cologne Could small local storages be used? Belgium

Germany France

Source: own map. 17 Summary on infrastructures

Electricity: • Direct electrification requires am EU wide massive extension of renewable electricity generation. • For NRW a massive grid extension to the West and North of NRW is needed. Oil • The infrastructure for hydrocarbon liquids is sufficient but would have to be converted if the energy industry went for a new reference energy carrier like methanol. • An all-electric world would do without this infrastructure. Gas • The natural gas grid is sufficient to carry synthetic methane.

• CO2 pipelines are needed in the CCS case or to carry industrial CO2 to CCU locations. • Hydrogen import could massively reduce the need to import electricity.

18 Possible further research and action

Need of more differentiated scenarios Technology needs, innovation roadmaps Investment needs and pathways

Co-evolution of heavy industry and energy system Timing interdependancies

Possible Strategies infrastructure programmes, investment schemes Go for public acceptance for industry and the infrastructure transition. Cross-border approach: Joint approach for the triangle NRW/Flanders/South Holland

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Clemens Schneider | [email protected]

Thank you for your attention!

20 How is carbon neutrality achieved? Carbon balances of the three scenarios

ICCS P2X all-electric carbon turnover: carbon turnover: carbon turnover: 31 Mt CO /a 121 Mt CO2/a 81 Mt CO2/a 2

CO2 taken from atmosphere 46 Mt CO2 (IMPORT) emissions 53 Mt

waste +6 Mt/a 6 Mt CO taken CO2 taken CO 2 CO2 CO2 in 2 from emissions from emissions products 68 Mt

emissions: atmosphere atmosphere 2

19 Mt 12 Mt -6 Mt/a (IMPORT) 62 Mt 18 Mt 68 Mt waste CO2 in energy system system energy net CO Fossil -6 Mt/a 6 Mt products energy energy fossil system Import resources 7 Mt 19 Mt energy system system energy resources emissions:

waste 2 CCS CO2 in 6 Mt products

7 Mt emissions:

19 Mt 2 net CO 49 Mt fossil resources net CO

Source: own figure.

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