Enbridge teams up with Alberta First Nations on carbon capture project

Capital Power’s Genesee Generating Station, located west of Edmonton. (Supplied)

Kerry McAthey
CTV News Edmonton
Feb. 4, 2022 

Enbridge has partnered with four Treaty Six Nations and the Lac Ste. Anne Métis Community to expand a proposed carbon capture and transportation project west of Edmonton.

In a Thursday announcement, Enbridge said the Open Access Wabamun Carbon Hub is being developed to both transport and store carbon, in support of recently announced carbon capture projects by Capital Power, Lehigh Cement, and others.

The Alexander First Nation, Alexis Nakota Sioux Nation, Enoch Cree Nation, and Paul First Nation recently formed the First Nation Capital Investment Partnership (FNCIP) to pursue ownership in major infrastructure projects. The partnership with Enbridge on the Hub is the FNCIP’s first such project.

“This path creates an opportunity to generate wealth, but more importantly it allows sustainable economic sovereignty for our communities,” said Chief George Arcand Jr. of Alexander First Nation in a release. “We’re looking forward to working with industry leaders who share our values of environmental stewardship and to collaborate with Enbridge on world-scale carbon transportation and storage infrastructure investments.”

The hub would transport carbon emissions like those from the Lehigh Cement plant in Edmonton by pipeline, to be stored by Enbridge. According to Enbridge, that project alone could capture up to 780,000 tonnes of carbon dioxide annually.

Combined, the emissions from Capital Power and Lehigh’s projects could avoid nearly four million tonnes of atmospheric carbon dioxide emissions.

Enbridge has applied to develop the open access hub through the province’s Request for Full Project Proposals process.

Enbridge and its partners haven't publicly said what the project will cost, except that it expects to invest "hundreds of millions of dollars."

The company said pending regulatory approvals, it could be up and running by 2025.

Alberta's investment in carbon capture technology not worth bang for buck, environmental group argues

Alex Antoneshyn
CTVNewsEdmonton.ca Digital Producer
Updated Jan. 21, 2022 


A new report accuses the oil-and-gas industry of greenwashing the impact of carbon capture and storage – also known as CCS – technology, pointing to an oil-processing complex in Alberta that emits more carbon than it buries in the ground.

The report by Global Witness argues CCS is a poor substitute for phasing out fossil fuels and an expensive undertaking that the governments of Alberta and Canada partly funded.

"We think this really isn't sustainable, it's not climate friendly, and it shows that governments across the world, not just in Canada, mustn't support fossil hydrogen," report author Dominic Eagleton told CTV News Edmonton. "They should boost more genuinely sustainable alternatives to fossil hydrogen, such as renewables."


Global Witness, a non-government organization based in the U.K., says its goal is to create a "more sustainable, just and equal planet."

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Eagleton, a senior campaigner with the group, compared the amount of emissions produced at Shell's Scotford Complex in Fort Saskatchewan, northeast of Edmonton, with the amount of carbon dioxide its CCS system – called Quest – removes. He says the site was chosen because of the data publicly available on it.

Global Witness found that between 2014 and 2019, Quest stored five million tonnes of carbon dioxide, or CO2. During the same period, it says the Scotford Complex produced in total 7.5 million tonnes of greenhouse gases, including methane. The data was pulled from reports submitted by Shell to the Alberta government, as well as data crunched by the Pembina Institute.

Eagleton calls the 2.5-million tonne difference a "wake-up call for the world."

Shell believes Quest hints at what is possible in the future.

'A DEMONSTRATION PROJECT'

Shell operates Quest on behalf of its partners mining oil sands in northern Alberta and refutes Global Witness' assertion it overpromised Quest's potential.

In addition to the CCS system, Scotford Complex consists of an upgrader that turns bitumen from those oil sands into lighter crude products, a refinery that makes fuels and other products from synthetic crude oil, and a chemical plant.

In order to upgrade bitumen, Shell makes hydrogen, producing carbon dioxide in the process.

Quest's job is to capture and liquefy CO2 before trapping it two kilometres below ground.

Quest has stored about six million tonnes of carbon in its six-and-a-half years – faster and cheaper than expected, according to the company. However, the system was never meant to capture more than one third of the Scotford upgrader's emissions, Shell maintains.

When Quest was built, it was touted as the world's first commercial-scale CCS facility at an oil sands operation. And, as one of the first facilities of its kind, Quest isn't able to capture and store as much carbon as is now possible – around 90 per cent, the industry estimates.

"We were there working with the government to really demonstrate Quest as a proof point that CCS does work. Not only in the capture in a brownfield site, but also the storage complex," Shell's national CCS lead Tim Wiwchar told CTV News Edmonton.

"We called it a demonstration project."

Shell is currently planning a CCS project at Scotford that would have a storage capacity of 300 million tonnes of carbon dioxide, or the above-90 per cent capture levels industry says current technology now allows.

The company is expected to decide to move forward or not with Polaris in late 2023.

'A FRACTION OF THOSE EMISSIONS'

Quest cost $1.35 billion, $845 million of which came from the provincial and federal governments. Some of the provincial dollars, contingent Quest's performance, continue to flow in.

And more dollars will flow to similar projects in the future.

Alberta wants to increase its CCS capacity and has incentivized proposals as part of a plan to capitalize on what is expected to become a $2.5-trillion global hydrogen market by 2030. Hydrogen's potential is premised on its nature to burn cleanly. When it is made alongside a carbon capture system, like at Shell Scotford Complex, it's known as blue hydrogen – and considered dirtier only than green hydrogen made with renewable energy.
Alberta prioritizes oil sands' carbon storage hub, energy minister says
Plans for $1.3B net-zero hydrogen plant underway in Alberta's capital region
Alberta hopes hydrogen becomes the next oil sands and 'generational wealth' creator
Alberta funding $131M in new emission reduction projects

But Eagleton says it is misleading for the fossil fuel industry to present hydrogen production and carbon capture as favourably as it does when CCS can't transform the oil-and-gas sector into a zero-emitting industry.

The senior campaigner at Global Witness found Quest only captured 48 per cent of carbon emissions produced by the Scotford complex – which he called "a fossil hydrogen plant," which Shell disputed – and 39 per cent of all greenhouse gas emissions.

"Trying to apply carbon capture systems to the rest of the world's fossil hydrogen plants could be a disaster for the climate because it might only capture a fraction of those emissions," Eagleton told CTV News Edmonton.

He also believes investing more in carbon-capture infrastructure is a bet in technology that hasn't yet proven itself, when compared to things like wind and solar power.

"It's these options that will take us to a safer climate and not more investment in fossil-fuel infrastructure, which is what fossil hydrogen will entail," Eagleton added.

"Given…that CCS is required in other industries that go beyond fossil fuels -- fertilizer, cement, chemicals, those are all going to be required into the future -- that again, this is a proof point using an oil and gas facility that CCS does work," Wiwchar responded.

"[Quest] has captured over six million tonnes of CO2. That's six million tonnes that would have been emitted from the upgrader…had we not built Quest."

Alberta's energy minister did not respond to CTV News Edmonton's request for comment.

With files from CTV News Edmonton's Touria Izri


Quest carbon capture and storage facility in Fort Saskatchewan Alta., on Nov. 6, 2015. (Jason Franson / THE CANADIAN PRESS)

Shell’s massive carbon capture facility in Canada emits far more than it captures, study says

The "Quest" plant in Alberta, Canada, owned by oil giant Shell, has previously been touted as a "thriving example" of how CCS is working to significantly reduce carbon emissions.

However, an investigation by watchdog group Global Witness, showed that while 5 million tons of carbon dioxide had been prevented from escaping into the atmosphere at the plant since 2015, it released a further 7.5 million tons of greenhouse gases over the same period.

In response, a spokesperson for Shell told CNBC via email that the analysis was "simply wrong."

 Provided by CNBC Signage for Royal Dutch Shell Plc at a refinery near the Enbridge Line 5 pipeline in Sarnia, Ontario, Canada, on Tuesday, May 25, 2021.

One of the only facilities in the world that uses carbon capture and storage technology (CCS) to reduce the emissions of hydrogen production has been found to emit far more greenhouse gas emissions than it captures.

The Quest plant in Alberta, Canada, owned by oil giant Shell and designed to capture carbon emissions from oil sands operations and safely store them underground, has previously been touted as a "thriving example" of how CCS is working to significantly reduce carbon emissions.

However, an investigation by watchdog group Global Witness, published last week, showed that while 5 million tons of carbon dioxide had been prevented from escaping into the atmosphere at the plant since 2015, it also released 7.5 million metric tons of greenhouse gases over the same period.

The investigation noted that, per year, that's the equivalent carbon footprint of 1.2 million gasoline cars.

It means just 48% of the plant's carbon emissions were captured, according to the report. That's far short of the 90% carbon capture rate promised by the industry for these types of projects in general.

In response to the report, a spokesperson for Shell told CNBC via email that Global Witness' analysis was "simply wrong" and stressed that the Quest facility was designed to capture around a third of carbon dioxide emissions.
Energy transition

Proponents of CCS believe these technologies will play an important role in meeting global energy and climate goals. And using CCS alongside hydrogen production, which is sometimes referred to as "blue hydrogen" or "fossil hydrogen," has been pushed by the oil and gas industry as a potential solution to the energy transition.

Climate researchers, campaigners and environmental advocacy groups have repeatedly admonished CCS as a climate solution, however, arguing that not only do these technologies have a history of failure, but backing these projects prolongs our reliance on the fossil fuel industry and distracts from a much-needed pivot to renewable alternatives.

"Oil and gas companies' promotion of fossil hydrogen is a fig leaf for them to carry on with their toxic practices – the extraction and burning of fossil fuels," Dominic Eagleton, senior gas campaigner at Global Witness, said in a statement.

"The single best way for companies like Shell to help tackle the climate crisis is to phase out all fossil fuel operations, rather than find ways to hide their climate-wrecking activity behind false solutions."

The burning of fossil fuels such as oil and gas is the chief driver of the climate emergency and researchers have repeatedly stressed that the best weapon to tackle rising global temperatures is to cut greenhouse gas emissions as quickly as possible.

Yet, even as politicians and business leaders publicly acknowledge the necessity of transitioning to renewable alternatives, current policy trends show that our reliance on fossil fuels is not likely to go away — or even decline — any time soon.
'Demonstration project'

Shell's Quest CCS facility opened in late 2015 near Edmonton, Alberta and is part of the group's Scotford complex, where hydrogen is produced for use in refining oil sands bitumen (a type of petroleum deposit). The Quest plant does not cover the emissions for the entire facility.

"Our Quest facility was designed some years ago as a demonstration project to prove the underlying CCS concept, while capturing around a third of CO2 emissions. It is not a hydrogen production facility," the Shell spokesperson said.

"The hydrogen projects we're planning – like Polaris – will use a new technology that captures more than 90% of emissions. Global Witness are comparing apples with pears."

Shell announced plans in July last year to build a large-scale CCS project called Polaris at its Scotford refinery and chemicals plant. The initial phase is expected to start operations in the middle of the decade subject to an investment decision by the company next year.
A 'serious blow' to fossil hydrogen

Global Witness said its findings are likely to deliver a "serious blow" to fossil hydrogen proponents pushing for more public funds to support its use, noting that $654 million of the $1 billion costs of Shell's Quest facility stemmed from Canadian government subsidies.

Eagleton described the analysis as "yet another nail in the coffin" for claims made by the oil and gas industry that fossil hydrogen is climate-friendly.

"Governments cannot let the wool be pulled over their eyes to invest vital public funds in projects that will not deliver what's needed to avert climate disaster. Instead, they should use that money to end our reliance on fossil fuels and direct it towards renewable alternatives," Eagleton said.

Commenting on the report, Swedish climate activist Greta Thunberg said via Twitter on Saturday: "This is exactly what happens when people in power care more about their reputation and imagery than to actually reduce emissions."

The role of hydrogen in our low-carbon transition

Hydrogen fuel has long been hailed as the silver bullet that will free us from fossil fuels, but it's time for a reality check on its production and use in a low-carbon economy .

Mike Childs 

FRIENDS OF THE EARTH

21 Apr 20

Summary
Introduction
The environmental impacts of hydrogen production
Low-carbon hydrogen production
Prioritise using hydrogen when there are no practicable alternatives
Rapid decarbonisation requires a lot more hydrogen
Scale of renewable energy required
ANNEX

View as PDF

Summary

Hydrogen is being hyped as an easy way to provide low-carbon energy for heating, transportation and industry. But as this briefing shows, while hydrogen will be an important component of the low-carbon transition, its production will necessarily be limited over the next decade and it should be prioritised for uses where there’s no low-carbon alternative, such as industry. In other sectors, such as heating, alternative approaches will be needed.
Introduction

The UK has a legal obligation to achieve net-zero greenhouse gas emissions by 2050 at the latest, although Friends of the Earth and others are calling for this target to be achieved earlier. Regardless of the end date, it is cumulative emissions that matter in the fight against climate breakdown, which is why the UK’s Climate Change Act has interim targets in the form of 5-year carbon budgets.

The current fifth carbon budget mandates a 57% reduction in greenhouse gas emissions by 2030 but will need adjusting because of the new net-zero target. The Committee on Climate Change (CCC) will make recommendations in December 2020 for the scale of cuts required by 2030 (the mid-point of the fifth carbon budget), as well as making recommendations for 2035 (the sixth carbon budget).

The role of hydrogen in meeting the reduction targets is increasingly being discussed.

For example:
The National Infrastructure Commission (NIC) recently published a report1 stating that the cheapest route to zero-carbon power is 90% renewable energy generation, supported by burning hydrogen to make electricity when renewable energy production is low. It says that using hydrogen reduces total energy system costs by around 20%.
It’s also increasingly suggested that hydrogen could be used for zero-carbon production of steel, cement and other industrial products. The Oxford Institute for Energy Studies has recently published a detailed briefing2 on this issue.
Hydrogen is being promoted for use in some transportation, such as trains and heavy goods vehicles.
Over recent years the gas industry has been promoting a switch for home heating from natural gas to hydrogen3 (although in doing so it has been criticised for significantly under-estimating the costs, not fully considering the risks of leakages from home pipework not suited for hydrogen, and underplaying the challenges involved).2 See below for more discussion of hydrogen in heating.

The future role of hydrogen is broadly accepted but the question of how it should be produced remains. This choice could have a significant impact on greenhouse gas emissions. Key decisions must be made soon and making the wrong choices could perpetuate our reliance on fossil fuels.
The environmental impacts of hydrogen production

There are two broad routes for hydrogen production:
From fossil fuels, either gas using steam methane reformation (SMR) or coal. This is sometimes known as "blue hydrogen."
By electrolysis, using electricity to split water into hydrogen and oxygen. This is sometimes known as "green" hydrogen, particularly if the electricity used is from renewable sources.

Virtually all current global hydrogen production is made directly from fossil fuels. Only 2% of global hydrogen production is from electrolysis and it accounts for only 4% in the UK.

Production of hydrogen from fossil fuels is a carbon-intensive process

According to the CCC, hydrogen produced from natural gas by SMR has a carbon-emissions intensity of around 285 gCO₂/kWh. This excludes the impact of fugitive emissions from extraction of natural gas, estimated to be 15-70 gCO2e/kWh,4 although this could be 25-40% higher according to recent research.5 Hydrogen from coal gasification has an intensity of around 675 gCO₂/kWh.

In comparison, the carbon-emissions intensity of the electricity grid in 2019 was less than 200 gCO₂/kWh and is declining fast. Emissions from the global production of hydrogen are more than double the UK’s total territorial emissions.6

Carbon capture and storage will not deliver zero carbon

Hydrogen production from fossil fuels can be partly decarbonised by carbon capture and storage (CCS). However, doing so brings an energy penalty and extra costs. According to the International Energy Agency (IEA) Greenhouse Gas R&D Programme,7 CCS rates are generally designed to be 85-90% efficient (ie 10-15% of the carbon emissions aren’t captured). The IEA report suggested that while it should be technically possible to achieve capture rates of 99% using CCS, doing so brings an additional efficiency penalty for the power plant, meaning that even more energy is needed to produce the same amount of hydrogen. This in turn increases the amount of upstream fugitive emissions from the extraction and transportation of fossil fuels.
Low-carbon hydrogen production

Electrolysis using renewable electricity has negligible carbon emissions, although if it uses grid electricity, its emissions will be higher than the carbon-emissions intensity of the grid, because the production process is not 100% efficient. That’s why it’s better to use electricity directly, in electric vehicles for example, rather than converting it to hydrogen. As an illustration, in 2018 hydrogen made using grid electricity would’ve had a carbon-emissions intensity of 288-388 gCO₂/kWh, when the grid’s intensity was 216 gCO₂/kWh.

The carbon intensity of hydrogen production from the electricity grid is therefore already lower than hydrogen made from fossil fuels (see chart below). This difference will only increase over time as the carbon-emissions intensity of the electricity grid reduces. In 2019 it fell below 200 gCO₂/kWh and it’s forecast to drop below 100 gCO₂/kWh by 2030 and 41 gCO2/kWh by 2035.

Carbon intensity of various hydrogen production methods compared to natural gas. Note that data for natural gas include fugitive emissions from natural gas extraction. CCS assumed to be 95% capture rate.

Scaling up production and the real cost of producing hydrogen

Hydrogen production using natural gas (SMR) is an established process. This has the advantage that manufacturing capacity can be ramped up relatively quickly (the H21 project envisages a 12.5 GW hydrogen from natural gas plant, built in a modular 1.25 GW plant each year from 2026), but the downside is that there are unlikely to be significant cost reductions. However, the necessary CCS elements are still in development and in practice unlikely to be available at scale until the 2030s.

The government’s action plan for CCS states that "our ambition is that the UK should have the option to deploy [CCS] at scale during the 2030s, subject to the costs coming down sufficiently."8 The recent Budget stated it will invest "at least £800 million" for a CCS infrastructure fund that will support efforts to "establish CCS in at least two UK sites, one by the mid-2020s, a second by 2030."

Will CCS be at scale in time?

Given the chequered past of developing CCS in the UK, it would be a brave bet that the UK would have large-scale operational CCS facilities by 2030, when significant inroads to decarbonising heating need to be made.

Will hydrogen from natural gas be affordable?

The cost of making hydrogen from natural gas with CCS is also uncertain, because no plant is operational. One recent proposal to the government, for a CCS plant based in Aberdeen with its associated existing infrastructure, estimated the cost at 8 p/kWh, with peak hydrogen production of 6 tonnes/hour from a 200 MW plant.9 Unsurprisingly, this is considerably higher than wholesale natural gas prices, which average 1-2 p/kWh.10Such increased cost would be passed onto the consumer, significantly increasing the price of gas for home heating and making it at least as expensive as electricity.

Electrolysis – scope for cost reductions?

Hydrogen production using electrolysis is a newer technology, which will make it harder to scale up production quickly. However, a recent Bloomberg New Energy Finance (NEF) report says that the cost of electrolysers in North America and Europe has fallen by 40% since 2014, and costs are even lower in China (80% cheaper than those in the West).11

British company ITM has recently secured government support with others to develop a modular 100 MW electrolyser system with peak hydrogen production of 40 tonnes/day (this hydrogen could supply 0.6 TWh/year). Although this is a tiny fraction of the amount needed in the future and less than 2% of current UK hydrogen production, the project aims to "validate a complete production system capable of delivering hundreds of megawatts of electrolysers per year."12 This is the beginning of a process to start scaling up the production of hydrogen from electricity.

Hydrogen production from electrolysis also has the advantage that it can be located near to use, as it only needs an electricity supply and no carbon capture facilities. For example, it could be located at a train depot for hydrogen refuelling.

Cost of making hydrogen by electrolysis uncertain

As this is a newer technology, it has scope for significant further cost reductions, as has been seen in the renewable energy and battery sectors. The CCC suggested the cost might be around 6-8 p/kWh, although it also forecast much lower costs for hydrogen from natural gas with CCS at around 4 p/kWh. The more recent Bloomberg NEF report suggests that the costs of producing hydrogen by electrolysis may be similar to producing it from natural gas with CCS by 2030 and cheaper by 2050.11

According to the Oxford Institute for Energy Studies: "the levelised cost of SMR/CCS is likely to be significantly lower [than electrolysis] at current gas and electricity prices … In the longer term, assuming appropriate scale up and cost reduction of renewable electricity and electrolysis, it will be preferable for [electrolysis] to become the dominant production technology to minimise the continued use of fossil fuels."2

The NIC also sees natural gas being the main source for hydrogen production, albeit alongside electrolysis when electricity prices are low.1 A Navigant Consulting analysis on behalf of the Electricity Network Association assumes that hydrogen production costs will fall to 5-6 p/kWh by 2050, for both hydrogen from natural gas and electrolysis using dedicated renewables.13

Will hydrogen be affordable?

It’s likely that for at least the next decade, making hydrogen from natural gas will be cheaper than from electrolysis, but this may not be true in 10 years’ time. Both approaches are more expensive than natural gas, which poses affordability questions for some future uses, such as in households, where it could increase levels of fuel poverty. Significant scale-up of either approach is highly unlikely over at least the next 10 years, but for different reasons. The lack of CCS facilities at scale will hold back production of hydrogen from natural gas, whereas electrolysis is a developing technology that’s still exploring how to build capacity at scale quickly.

Current and future demands for hydrogen production

The UK currently produces and uses around 700,000 tonnes of hydrogen per year (equivalent to around 29 TWh). This is produced from natural gas using carbon-intensive processes without CCS. Nearly all of it is for refining fuels and ammonia production. Replacement of this with low-carbon hydrogen would be a sensible priority.

In the future, potential additional demand would be very significantly higher than this.

Decarbonising electricity

The NIC has recommended that the best low-cost route for decarbonising electricity production is by achieving 90% renewable energy by 2050, backed up by hydrogen combustion in 55 GW of turbines, producing 77 TWh of electricity.

Decarbonising industry

The CCC suggests up to 82 TWh of hydrogen might be needed by industry.4
In 2018, the Hybrit project in Sweden started constructing a pilot plant to manufacture primary steel using hydrogen produced via electrolysis, aiming to have a fully commercialised carbon-free process by 2035.
Cement production requires intense heat (>1600 °C), which could be provided by either an electric or hydrogen kiln furnace. The Oxford Institute for Energy Studies says that since neither has yet been developed at commercial scale, it’s not yet clear which option will prove more cost effective.
The chemicals industry is already a significant user of hydrogen. Emissions reductions can be made by increasing the use of hydrogen through process changes. A report commissioned by the European Chemical Industry Council said that "hydrogen is a key enabler for a major part of low-carbon technologies."14
Natural gas is also used in glass and ceramics production, although whether these can be switched to hydrogen is currently unclear according to the Institute of Engineering and Technology.6

Decarbonising transport

Hydrogen has been suggested as a route for decarbonising shipping (in the form of ammonia fuel), long-distance HGVs, trains, buses and cars. The Oxford Institute for Energy Studies suggests that batteries are likely to be a better option for trains in most cases, with batteries recharging when travelling on electrified track. Where the distance between recharging points exceeds 200 km, trains that also have hydrogen fuel cells make more sense.2 Similarly, electric buses and cars are far preferable to hydrogen-powered ones.

Is it realistic to power the whole domestic sector with hydrogen?

Northern Gas Networks’ H21 project is an extreme example, proposing wholescale switching to hydrogen, with all home heating provided by boilers burning hydrogen.

By 2050, it would require around 8 million tonnes of hydrogen (equivalent to 300 TWh) to heat 3.7 million homes and businesses in the north of England. Production of this amount would require 140 GW of electrolysers powered by wind (current UK wind capacity is around 22 GW). And it would consume a vast quantity of water, equivalent to the annual consumption of 1.2 million homes.

Alternatively, producing this hydrogen from natural gas would require around 60 plants the size of the largest in the world,6 and these would not be low carbon. The cost for householders would be substantial, potentially driving many more homes into fuel poverty. It would require the replacement of all boilers and gas cookers, and potentially all pipework in the home.

Decarbonising domestic heating

Another way to start decarbonising heating is by adding hydrogen to the gas supply, up to around 20%. The safety and practicalities of this are currently being tested. More than 20% could be added, but would require changing boilers and gas cookers. But even if this extra hydrogen was produced by renewable energy, it would only have a small impact on reducing emissions.

The most sustainable home heating approach is to use electricity largely or wholly, with hydrogen either as a domestic back-up (using hybrid heat pumps that can switch between electricity and gas) or to produce electricity when renewable sources are low. The former is more energy efficient (because using hydrogen directly in the home is more efficient than burning it to make electricity) and is the route preferred by the CCC,4 but requires ongoing use of the gas grid, whereas the latter approach doesn’t.

Viability

Hydrogen is needed for the move to net zero, replacing natural gas in parts of the energy system where electrification isn’t feasible or is prohibitively expensive. But scaling up hydrogen production will take time, and in practice hydrogen production from natural gas with CCS or electrolysis will be very limited before 2030 and still limited for the decade after.

Yet even meeting existing carbon budgets means more action is needed before 2030 on reducing emissions, and significantly more if the CCC recommends deeper cuts by 2030, which it should.
Prioritise using hydrogen when there are no practicable alternatives

Low-carbon hydrogen use should be prioritised where no alternative readily exists, such as shipping, industry and some heavy goods vehicles. Uses where electric options exist should use this approach, including domestic heating and most transport.

In practice, this means:
In homes the focus must be on energy efficiency and electrification via the installation of heat pumps (with an ambitious stretch target of 10 million installed by 2030). Friends of the Earth, the Energy Savings Trust, and others are calling for all homes to have at least a C-rated Energy Performance Certificate by 2030. Hydrogen should only be used at times of peak demand, either directly through the gas grid for use in hybrid heat pumps or for production of electricity.
In transport a faster transition to electric vehicles is needed, including necessary investments in grid infrastructure. Localised hydrogen production for some heavy transport will be necessary where a switch to electric isn’t possible. For shipping, hydrogen converted to ammonia is likely to be the most practical route.
In industry a switch to electricity should be prioritised where possible, and hydrogen where not. This will have an impact on costs, so measures to ensure that UK manufacturers are not disadvantaged by this move should be taken.

The CCC’s "Further Ambition" scenario suggested that around 270 TWh of hydrogen is needed, with industry using 120 TWh, shipping using 70 TWh, 53 TWh for peak heating and 25 TWh in transport. It envisages only 2 TWh for electricity production, unlike the 77 TWh suggested by the more recent NIC report. The CCC will be producing a new analysis this September and may upgrade its recommended use of hydrogen.
Rapid decarbonisation requires a lot more hydrogen

Based on the CCC’s "Further Ambition" scenario and the more recent NIC recommendation of a 90% renewable energy grid, it’s clear that the UK needs to produce a lot more hydrogen (equivalent to more than 300 TWh).

Furthermore, to reduce emissions as deeply as possible requires this to be met through electrolysis rather than natural gas, because of the fugitive emissions from natural gas extraction and transportation. This will require around 140 GW of windfarms, in addition to the renewables needed to decarbonise the electricity grid to meet other demands.
Scale of renewable energy required

The NIC report suggested up to 237 GW of renewable energy, producing 530 TWh of electricity, will be needed by 2050 to meet the government’s net-zero goal. If all the hydrogen required (see above) were produced by electrolysis, this amount of renewable energy would need to increase significantly.

Currently, total renewable capacity (excluding biomass) is only about 34 GW. In other words, we need to see more than a seven-fold increase in renewable power, yet currently the UK is aiming to increase renewable energy capacity only fourfold by 2050.15

Hydrogen is needed to reach net zero. To meet net-zero ambitions, it should be produced by electrolysis. For this to happen, national and local government need to support much higher deployment rates of renewable energy than they’re currently achieving.
ANNEX

Hydrogen supply projects supported by the government

In February 2020, the UK government announced financial support for several hydrogen production projects across the UK,16 summarised below. A wider range of projects is funded by industry, the UK government, Ofgem and devolved nations in the Institute of Engineering and Technology "Transitioning to Hydrogen" report.6

Dolphyn – involves producing hydrogen from seawater powered by offshore wind in deep waters off the north of Scotland. The government says the funding will enable the detailed design of a 2 MW prototype system.

HyNet – looks at producing hydrogen from natural gas with CCS and blending the hydrogen into the existing gas grid at volumes that don’t require changes to appliances. The project has been given £7.48 million to permit further project development including engineering design to deliver a "shovel ready" project. Of two potential locations – the Mersey and the Humber – the Mersey is seen as the most attractive.

Gigastack – invovles producing hydrogen from renewable power, using electricity from Orsted’s Hornsea Two offshore windfarm to generate renewable hydrogen for the Phillips 66 Humber Refinery. The £7.5 million funding will also support the development of plans for large-scale production of electrolysers.

Acorn – looks at producing hydrogen from natural gas with CCS for blending into gas consumed in Aberdeen. The £2.7 million grant will enable further engineering studies.

HyPER – this project has been awarded £7.4 million for the pilot development of a novel process for hydrogen production from natural gas developed by the Gas Technology Institute at Cranfield University.



Mike Childs, Policy & Insight Unit, April 2020

1. a. b. https://www.nic.org.uk/publications/net-zero-opportunities-for-the-power-sector/ 

2. a. b. c. d. https://www.oxfordenergy.org/wpcms/wp-content/uploads/2020/03/Insight-66-Hydrogen-and-Decarbonisation-of-Gas.pdf?v=79cba1185463 

3. https://www.h21.green/ 

4. a. b. c. https://www.theccc.org.uk/2018/11/22/hydrogen-is-a-credible-option-for-the-future-the-uk-must-now-prepare-for-the-key-decisions-on-zero-carbon-energy/ 

5. https://www.carbonbrief.org/methane-emissions-from-fossil-fuels-severely-underestimated 

6. a. b. c. d. https://www.theiet.org/media/4095/transitioning-to-hydrogen.pdf 

7. http://documents.ieaghg.org/index.php/s/CLIZIvBI6OdMFnf 

8. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/759637/beis-ccus-action-plan.pdf 

9. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/866380/Phase_1_-_Pale_Blue_Dot_Energy_-_Acorn_Hydrogen.pdf 

10. https://www.gov.uk/government/statistics/quarterly-energy-prices-december-2019 

11. a. b. https://about.bnef.com/blog/hydrogen-economy-offers-promising-path-to-decarbonization/ 

12. https://www.itm-power.com/news/industrial-scale-renewable-hydrogen-project-advances-to-next-phase 

13. https://www.regen.co.uk/wp-content/uploads/Regen-Heat-Paper-WEB2-Single-Page.pdf 

14. https://dechema.de/dechema_media/Downloads/Positionspapiere/Technology_study_Low_carbon_energy_and_feedstock_for_the_European_chemical_industry-p-20002750.pdf 

15. https://www.gov.uk/government/news/millions-more-homes-to-be-powered-by-renewables 

16. https://www.gov.uk/government/publications/hydrogen-supply-competition/hydrogen-supply-programme-successful-projects-phase-2 INSIGHT ENERGY CLIMATE CHANGE


Further reading

 

Developing Onboard Carbon Capture and Storage for the Maritime Industry

Courtesy ABS

PUBLISHED FEB 21, 2024 2:00 PM BY HAMID DAIYAN

 

Technology to enable the reduction of emissions from ships is emerging with support from class, writes Hamid Daiyan, Sustainability Manager, ABS.

The potential of onboard carbon capture and storage (CCS) to reduce emissions from shipping is subject to ever-growing interest from the shipping industry. As vessel operators seek to comply with current and future regulations and achieve long-term climate goals, carbon capture promises to play a key role.

One of the key drivers to this is the presently limited availability of low-carbon fuels, which is pushing the industry to consider all options for lower emissions beyond energy efficiency measures.

Regulation continues to shape the process. Recent International Maritime Organization (IMO) meetings have considered submissions on this topic and an Intercessional Working Group (IWG) has been established to consider these proposals.

ABS is currently working with vendors and shipowners to understand how this emerging technology can be adapted and absorbed into the maritime industry, its implications for vessel design and operations and its likely impact on carbon emission reduction.

Technology

Existing CCS technologies are largely employed in shore-based applications. These technology platforms need to be marinised for shipboard application and in such a way that balances effective performance against capex and opex and additional fuel consumption.

Onboard CCS reduces greenhouse gas emissions from ships by capturing and storing the carbon dioxide produced onboard. This can be done either before or after the combustion process, using different methods and the captured carbon can be stored onboard in different ways, depending on the technology used.

Two potential onboard carbon storage methodologies are:

Liquefaction: The CO2 is compressed and cooled to form a liquid, which can be stored in tanks or cylinders onboard and can be transferred to shore facilities or other vessels.

Mineralization: CO2 is reacted with minerals to form solid carbonates, which can be stored in containers.

Supply Chain

The evolution of the carbon value chain to include carbon capture and storage onboard ship – as well as its transport at scale for sequestration – will have a large and sustained impact on the shipping industry’s stakeholders, including ports, bunker suppliers and fuel producers.

The capture of carbon dioxide from the vessel propulsion system will require a storage arrangement that can be connected to port facilities for ‘de-bunkering’ or transfer of the captured carbon to portside storage.

This may include direct connections at the berth or could feature the development of a new class of small, dedicated vessels similar to today’s bunker fleet built to handle the shipping of liquefied CO2 to storage or processing facilities.

What is not clear is which ports or marine locations will become centers for carbon storage and how they will manage this process. Ports will need to be intimately involved in the development of the supply chain as they could be the site both of storage and fuel production from LCO2.

Other factors that vessel operators need to consider are that vessels with CCS onboard may need to have offtake agreements in place for the LCO2, including facility certification and a legal framework covering the transfer of responsibilities.

Application Challenges

There are several challenges associated with onboard CCS, which include the high cost and complexity of the value chain which involves multiple actors and stages such as capture, storage, transport, injection, and monitoring of CO2. Each stage has its own technical, operational, and safety requirements that require attention.

The value chain that will handle and store ever larger volumes of carbon is still in the development phase; large-scale storage and processing capacity will be required. For onboard CCS to scale sufficiently, the shipping industry will need to collaborate with other stakeholders in order to establish the required infrastructure and agreements.

Stronger regulation is needed to create a long-term pathway against which owners can invest. Additionally, the public's perception and acceptance of CCS are influenced by their awareness and understanding of the benefits and risks of the technology.

ABS Activities

ABS has been working with global shipping organizations on joint development projects (JDPs) to showcase the safety and feasibility of using onboard CCS. We take a technology-neutral approach - working with vendors and stakeholders across the supply chain to provide Approvals in Principle and New Technology Qualifications to validate concepts and encourage full-scale pilots. We expect the first systems to be potentially available next year.

Additionally, ABS is collaborating with universities and research institutes to explore the potential of various carbon capture technologies for marine and offshore applications. ABS is dedicated to supporting the decarbonization of the shipping industry and advancing the development of onboard carbon capture as one of the potential solutions.

ABS has established a set of guidelines to direct the maritime industry on how to apply carbon capture technology. These guidelines also comprise an optional ‘CCS-Ready’ notation for vessels, based on their level of preparation or readiness for future installations.

The Future

The 81st meeting of the Marine Environment Protection Committee next March will see the topic of carbon capture for shipping on the agenda, with debate likely on the application of systems in retrofits to existing vessels.

The deliberations of the IWG should be considered during this meeting and by this stage it is possible that results from full-scale industry projects will also be available as a commentary on the regulatory development process.

As noted, though the technology is still in development for maritime applications, the demand from shipping for applicable and certified systems means that widespread adoption is possible by 2030.

This adoption path assumes that the storage and processing ecosystem expands at a similar rate. Both these milestones depend on the speed of regulatory development. To achieve the IMO’s stated aim of net zero carbon emissions by 2050, uptake of onboard carbon capture technology will need to be consistent, with rules governing its application in place to drive rapid adoption.

Hamid Daiyan is the Sustainability Manager at ABS.

The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.

 

High cost, low profitability and storage challenges: Is carbon capture a realistic climate solution?

NO

By Angela Symons & Leah Douglas with Reuters

Published on 25/11/2023 - 

Here's why carbon capture is no easy solution to climate change.

Carbon capture technology is central to the climate strategies of many world governments.

It is also expensive, unproven at scale, and can be hard to sell to a nervous public.

This currently makes the model of capturing carbon dioxide emissions from the air and storing them for money unworkable.

As nations gather for COP28 - the 28th United Nations climate change conference - in Dubai at the end of November, the question of carbon capture’s future role in a climate-friendly world will be in focus.

So where are we up to with carbon capture and what stands in the way of its widespread deployment?

What is carbon capture?

Carbon capture is a way of reducing carbon emissions by capturing them at the source or removing them from the atmosphere.

The most common form of carbon capture technology involves capturing the gas from a point source like an industrial smokestack. 

From there, the carbon can either be moved directly to permanent underground storage (CSS) or it can be used in another industrial purpose first - a process known as carbon capture, utilisation and storage (CCUS).

Another form of carbon capture is direct air capture (DAC), in which carbon emissions are captured from the air.

Carbon dioxide storage tanks are seen at a cement plant and carbon capture facility in Wuhu, Anhui province, China, September 2019.REUTERS/David Stanway/File Photo

How many carbon capture projects currently exist?

There are currently 42 operational commercial CCS and CCUS projects across the world with the capacity to store 49 million tonnes of carbon dioxide annually, according to the Global CCS Institute, which tracks the industry. 

That is about 0.13 per cent of the world’s roughly 37 billion tonnes of annual energy and industry-related carbon dioxide emissions.

Some 30 of those projects, accounting for 78 per cent of all captured carbon from the group, use the carbon for enhanced oil recovery (EOR), in which carbon is injected into oil wells to free trapped oil. Drillers say EOR can make petroleum more climate-friendly, but environmentalists say the practice is counter-productive.

• World at risk of becoming 'hostage to CO2 capture', according to IEA's latest report
• MEPs call for militaries to be more transparent in reporting emissions

The other 12 projects, which permanently store carbon in underground formations without using them to boost oil output, are in the US, Norway, Iceland, China, Canada, Qatar and Australia, according to the Global CCS Institute

It is unclear how many of these projects, if any, turn a profit.

About 130 direct air capture facilities are being planned around the world, according to the International Energy Agency (IEA), though just 27 have been commissioned and they capture just 10,000 tonnes of carbon dioxide annually.

The US in August announced $1.2 billion (€1.1b) in grants for two DAC hubs in Texas and Louisiana that promise to capture two million tonnes of carbon per year, though a final investment decision on the projects has not been made.

High cost of carbon capture is a setback

One stumbling block to rapid deployment of carbon capture technology is cost.

CCS costs range from €14 to €110 per tonne of captured carbon depending on the emissions source. DAC projects are even more expensive, between €550 and €916 per tonne, because of the amount of energy needed to capture carbon from the atmosphere, according to the IEA.

Some CCS projects in countries like Norway and Canada have been paused for financial reasons.

Developers say they need a carbon price, either in the form of a carbon tax, trading scheme or tax break, that makes it profitable to capture and store the carbon. Without that, only carbon capture projects that increase revenue in a different way - like through increased oil output - are profitable.

• UN chief visits Antarctica, urging phase out of fossil fuels at upcoming COP28 talks

Countries including the US have rolled out public subsidies for carbon capture projects. The Inflation Reduction Act, passed in 2022, offers a $50 (€46) tax credit per tonne of carbon captured for CCUS and $85 (€78) per tonne captured for CCS, and $180 (€165) per tonne captured through DAC.

Though those are meaningful incentives, companies may still need to take on some added costs to move CCS and DAC projects ahead, says Benjamin Longstreth, global director of carbon capture at the Clean Air Task Force.

Some CCS projects have also failed to prove out the technology's readiness. A $1 billion (€1.15b) project to harness carbon dioxide emissions from a Texas coal plant, for example, had chronic mechanical problems and routinely missed its targets before it was shut down in 2020, according to a report submitted by the project’s owners to the US Department of Energy.

The Petra Nova project restarted in September.

A model of carbon capture and storage designed by Santos Ltd, at the Australian Petroleum Production and Exploration Association conference in Brisbane, May 2022.

REUTERS/Sonali Paul/File Photo

Problems with where to store captured carbon

Where captured carbon can be stored is limited by geology. This reality would become more pronounced if and when carbon capture is deployed at the kind of massive scale that would be needed to make a difference to the climate. 

The best storage sites for carbon are in portions of North America, East Africa and the North Sea, according to the Global CCS Institute.

That means getting captured carbon to storage sites could require extensive pipeline networks or even shipping fleets - posing potential new obstacles.

In October, for example, a $3 billion (€3.5b) CCS pipeline project proposed by Navigator CO2 Ventures in the US Midwest - meant to move carbon from heartland ethanol plants to good storage sites - was cancelled due to concerns from residents about potential leaks and construction damage.

Companies investing in carbon removal need to take seriously community concerns about new infrastructure projects, says Simone Stewart, industrial policy specialist at the National Wildlife Federation.

"Not all technologies are going to be possible in all locations," Stewart says.