Status - Renewable Bio- Production

? 2017 2020

Ingvar Landälv 2013 Fuels & Energy Consulting

November 5, 2020 Ingvar Landälv Fuel & Energy ConsultingLTU, Lund Content • Methanol being Green, Blue or Grey or Brown • Projects and plans • Production cost for renewable methanol • Combinations of bio- and e-methanol • Reflections on methanol production potential in • Summary

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 2 Methanol production pathways Green – Blue – Grey - Brown

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 3 -based Methanol Plant general scheme

ASU CO2

100 MW H2S O2 Gas con- Acid Gas Biomass* Pre- Gasifi- ditioning MeOH MeOH Removal MSW treatment cation incl. synthesis distillation WGS** (AGR)

* Various kinds incl. e.g. corn stovers, straw (50% moisture) ** Water Gas Shift Methanol 55-65 MW

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 4 List of Methanol Projects in various stages of planning

CAPEX Capacity CAPEX CAPEX # Project / study Status (Million Source (tpy) (EUR/ tpy) Euros) (EUR/kW) Trans World Energy FEED done, 1 (TWE), Florida (USA) Startup 2Q 875 000 385 440 640 TWE 2023 Basic ENI Refinery, Livorno, 2 Engineering 115 000 300 2610 3850 NextChem Italian (I) ready 3Q,2020 Startup early LowLand 3 LowLand Methanol (NL) 120 000 120 1000 1455 2023 Methnaol 4 Södra (SE) Operation 5000 10 2000 2909 Södra Enerkem, Rotterdam 5 Engineering 215 000 520 2420 3460 Enerkem (NL) 6 Enerkem, Tarragona (SP) Engineering 215 000 520 2420 3460 Enerkem 7 VTT 265 000 347 1309 1866 VTT 8 Chemrec, Domsjö Prel. Eng. 147 000 350 2380 3060 Chemrec 9 Chemrec, nth plant Concept 290 000 490/240* 1690/828* 2465/1290* Chemrec Investment New Hope Energy, Texas New Hope 10 decision 715 000 450 630 915 (USA) Energy 4Q,2020 * Credited for avoiding recovery boiler replacement

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 5 Reformer-based Methanol Plant general scheme

CO2 Sulphur steam O2 components Biogas feedstock* Biogas Pretreat MeOH MeOH plant ment reformer compr. synthesis distillation 100 MW

* Of various types e.g. manure, water treatment sludge 60-65 MW Methanol

Technology Feedstock Project, reference Project Product Plant capacity phase Steam reforming Natural gas/ BASF, Operational methanol 480 kt/y* biomethane Ludwigshafen (2009) (DE) Steam reforming Natural gas/ OCI/BioMCN Operational methanol 60 kt/y** biomethane Groningen

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 6 Production cost for various Advanced Source: IEA Bioenergy report 2020

Production cost Methanol EUR/MWh 160 from

140 Bio MSW 120

100

80

60

40 Current fossil fuel price range (equivalent to 40 - 70 USD/BBL )

20

0

Included on next figure

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 7 Production Cost Reduction Potential Source: IEA Bioenergy report 2020

Methanol From Bio From MSW

Current fossil fuel price range (equivalent to 40 - 70 USD/BBL )

-CP

Improvements => 25-50% on CAPEX and 10-20% on OPEX (depending on pathway) Lower finance costs => 22% lower capital cost (IRR from 13.1% to 10.2%)

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 8 Combined Bio- and e-Methanol, Step 1 (WGS** is replaced by imported hydrogen)

 Increased methanol production  No oxygen plant (potentially)  Simpler & more efficient process scheme  No HP steam demand for WGS because:  No new process developments  No WGS  Very efficient use of hydrogen

 Lower CO2 emission  Use of all CO in raw syngas

Green 32 MW power Electrolysis generation

H2 CO2 O2 from over the fence? O2

H2S

Biomass* Pre- Gasifi- Gas con- Acid Gas MeOH MeOH MSW treatment cation ditioning removal synthesis distillation

100 MW ~ 80 MW * Various kinds incl. e.g. corn stovers, straw (50% moisture) Methanol ** Water Gas Shift 5 November 2020 Ingvar Landälv Fuel & Energy Consulting 9 Combined Bio- and e-Methanol, Step 2

 A second methanol plant fed with CO2 from AGR and H2  Combined methanol distillation  No oxygen plant  Close to all carbon in biomass converted to methanol => More energy in produced methanol than in biomass feedstock

 E-methanol part produced with direct available, concentrated renewable CO2 170 MW Green MeOH power Electrolysis synthesis generation

H2 CO2 O2 155 MW 100 MW H2S Acid Gas Biomass* Pre- Gasifi- Gas con- MeOH MeOH Removal treatment cation ditioning synthesis distillation MSW (AGR)

* Various kinds incl. e.g. corn stovers, straw (50% moisture) Methanol

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 10 Combined Bio- and e-Methanol, Step 3

 Modified methanol catalyst converting both CO and CO2 with H2 to methanol  Gas cleaning which only removes impurities like sulphur components  Close to all carbon in biomass converted to methanol => More energy in produced methanol than in biomass feedstock

 E-methanol part produced with in situ available renewable CO2

170 MW Green power Electrolysis generation

H2

O2 100 MW 155 MW H2S

Biomass* Pre- Gasifi- Gas con- Gas MeOH MeOH MSW treatment cation ditioning cleaning synthesis distillation

* Various kinds incl. e.g. corn stovers, straw (50% moisture) Methanol

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 11 By far the MAIN INVESTMENT requirement when changing to a renewable fuel system IS IN THE FUELS PRODUCTION (Example Sweden with a need of 60 TWh of fuel for transport)

Area Part of total investment Feedstock production and transport Fuel production Fuel distirbution Vehicle production Others

xxx billion EUR*

Investment intensity xxx: Investment for 60TWh Pathway (EUR/kW fuel (Billion EUR) production capacity) Methane, MeOH, DME 1500-2000 11-15* Cellulosic ethanol 2500-3000 19-23* FT-liquids 2500-3000 19-23*

* Can be compared to an investment in high speed trains connecting – Jönköping – Malmö – Gothenburg. This investment is calculated to about 23 billion EUR. 5 November 2020 Ingvar Landälv Fuel & Energy Consulting 12 Generation of 60 TWh Renewable Methanol 1. A Bio-Methanol Scenario 2. A Combined Bio- and e-Methanol Scenario 66 TWh EL. water

Biomass 39 TWh gasification O2 Bio-Methanol to production Syngas Electrolysis of water TWh s generating 80 y Hydrogen hydrogen And 70 n 60 TWh g oxygen 60 Energy a conversion efficiency s 2 50 1 40 96 TWh 30 Combined No external CO2 20 bio-methanol required. Available Swedish biomass potential and 10 (low/high estimates) Biomass e-methanol at “zero” cost production

20 40 60 80 100 TWh 60 TWh

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 13 Summary

• Currently there is only a limited amount of renewable methanol produced in the World • Methanol production technology, its cost and performance is well known because most process steps are already practiced in commercial methanol production today. The key technology needing further development to become commercially available is the gasification step. • Methanol has one of the lowest production costs compared to other renewable fuel alternatives • Combination of bio- and e-methanol production pathways is efficient and leads to that (close to) all available carbon in the biomass feedstock becomes carbon in the renewable methanol. • Use of available global biomass resource estimated for 2030 and beyond and utilizing the combined bio- and e-methanol concepts can contribute substantially to the world-wide effort of bringing down fossil GHG emissions towards zero by 2050.

5 November 2020 Ingvar Landälv Fuel & Energy Consulting 14