POWER-TO-GAS & METHANATION PATHWAYS TO A HYDROGEN ECONOMY

Transcription

1 POWER-TO-GAS & METHANATION PATHWAYS TO A HYDROGEN ECONOMY 14TH ANNUAL APGTF WORKSHOP - LONDON, TH MARCH 2014 DR JOHN NEWTON

2 POWER-TO-GAS & METHANATION PATHWAYS TO A HYDROGEN ECONOMY Contents: Introduction P2G Energy Storage Rationale P2G Economics Compliance Additional applications: Methanation, Bio-gas upgrading, Fuel Summary

3 INTRODUCTION P2G RATIONALE ENERGY STORAGE RENEWABLE HEAT

4 GROWING WIND GENERATION Evidence of grid balancing problems from Germany and Denmark Problems start at 20% capacity; UK hit this threshold at the end of 2013 Energy Storage is a Market Pull 20% (55GW) Winter 20% (40GW) Summer Source: ITM Power plc, data from BWEA ENERGY STORAGE: THE NEED HYDROGEN ENERGY SYSTEMS

5 UK WIND CURTAILMENT Evidence of grid balancing problems from Germany and Denmark Problems start at 20% capacity; UK hit this threshold at the end of 2013 Energy Storage is a Market Pull ENERGY STORAGE: THE NEED HYDROGEN ENERGY SYSTEMS

6 BALANCING SUPPLY AND DEMAND: A total of 725m paid for balancing services in Estimates in 2020 are: circa 1.9bn - 5.9bn pa Tariffs already operational in the UK: FCDM response <2 seconds THE NEED: GRID BALANCING

7 WHY POWER-TO-GAS? Electricity cannot be stored easily Hydrogen can be stored easily in the gas grid Source: ITM Power plc POWER-TO-GAS RATIONALE

8 ENERGY STORAGE TECHNOLOGIES Power-to-gas is efficient long term low energy cost Source: ITM Power plc ENERGY STORAGE TECHNOLOGIES

9 Hydrogen fraction (vol%) Fraction wind output curtailed HYDROGEN FRACTION V S EXCESS WIND LEVELS Capturing 2.8 TWh pa of excess wind (i.e. 4% of 2020 output) Requiring 978MW of electrolysis at 30% utilisation Results in average national hydrogen content of 0.5%, reducing carbon footprint by 0.2% 3.5% 3.0% 725 TWh p.a. natural gas consumption, 30 GW wind capacity (2020) 35% 30% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% 25% 20% 15% 10% Hydrogen fraction 5% Curtailment 0% Excess wind (TWh pa) Source: ITM Power plc POWER-TO-GAS IN THE UK

10 EU Hydrogen Limits for Injection into the HP Gas Grid Covered by a range of local laws and EU Directives Note: interpretation of these rules is complex Limit falls to 2% if there is a CNG station downstream EU POWER-TO-GAS ENERGY STORAGE

11 GAS USAGE IN THE UK (DUKES 2013) Where does the gas go? 906 TWh of natural gas consumed in the UK in % was used to provide heat 34% burned in power stations to make electricity Source: Dukes 2013 WHERE DOES THE GAS GO?

12 ELECTRIFY HEAT?

13 DECC: UK HEAT STRATEGY The Future of Heating: Meeting the challenge 70% of UK heat comes from natural gas Low penetration of renewable heat in the UK RHI launched Nov % of heating from renewables by TWh hydrogen Circa 18,600 MW Electrolysis DECC: UK HEAT STRATEGY

14 P2G: ELEMENTS OF VALUE Value to the power grid Value to the gas grid Value to the economy Value to the Power Grid Avoided wind curtailment Avoided infrastructure upgrades Reduced reserve power Reduce CO 2 from open cycle GTs Absorbing reactive power Value to the Gas Grid Decarbonising gas Providing renewable heat Reducing GHG emissions from gas transportation Value to the UK Economy Reducing fuel imports Improved energy security Creating jobs in manufacturing P2G: ELEMENTS OF VALUE

15 P2G ECONOMICS CAPITAL COSTS TARIFF STRUCTURE CARBON REDUCTION

16 RENEWABLE HEAT INCENTIVE (RHI) A cost-based tariff scheme Where tariff levels vary depending on the cost of the technologies at different scales compensate for the additional cost of the renewable technology over fossil fuel heating; provide an incentive to overcome nonfinancial barriers; and provide a return on the additional capital invested Annual payments over a 20 year period index linked DECC: UK HEAT STRATEGY

17 Cost ( k) ELECTROLYSER COSTS FOR 1MW MODULES A cost-based tariff scheme Where tariff levels vary depending on the cost of the technologies at different scales Modular system Scale ~ Volume 1,800 1,600 1,400 1,200 1, ,700 1,400 Cost Estimates 1,200 1, ELECTROLYSER COSTS

18 Electrolyser cost (p/kwh ch) ELECTROLYSER COSTS FOR 1MW MODULES MW electrolyser: 70% efficient 1.7m Capex (over 20 years) % utilisation (Consumes 8760MWh per year) Cost = 0.97 p/kwh of electricity consumed = 1.4p/kWh of H 2 Produced 50% utilisation (Consumes 4380MWh per year) Cost = 1.90 p/kwh of electricity consumed = 2.8p/kWh of H 2 produced % 20% 30% 40% 50% 60% 70% 80% 90% 100% Utilisation Source: ITM Power ELECTROLYSER COSTS VS. UTILISATION

19 RHI FOR P2G APPLICATIONS Off Grid 30% utilization onshore 50% utilisation offshore Technically very challenging Grid Connected 100% utilisation Technically straightforward Demand Side Managed Excess wind utilisation Rapid response essential Technically challenging POWER-TO-GAS IN THE UK

20 OFF GRID P2G The ultimate in renewable heat Simplest tariff structure Where a grid connection is too expensive FIT for the turbine can be achieved by making RH Replace the existing export tariff with An Off Grid Electrolyser Tariff of the same value Generation Tariff Export Tariff 10p 5p Generation Tariff Electrolyser Tariff Burner 10p 5p POWER-TO-GAS IN THE UK

21 GRID CONNECTED Based on the Carbon Footprint of the grid: The UK grid is 164gCO 2 /kwh in 2030 (DECC) Produces H 2 of 234gCO 2 /kwh Methane is 198gCO 2 /kwh TUV definition of Green Hydrogen is 50gCO 2 /kwh DSM and rapid response needed to produce green hydrogen Green hydrogen generated by means of electrolysis of water must have a greenhouse gas reduction potential of at least 75 per cent compared to the currently valid reference value for fossil fuels of the Bio fuel Sustainability Act or conventionally generated hydrogen. POWER-TO-GAS IN THE UK

22 DEMAND SIDE MANAGED A Matrix of possibilities: Accessing renewable power via the grid Grid balancing DSM Utilising curtailed wind Significant modelling work undertaken Grid 9p/kWh Curtailed 0p/kWh Green Hydrogen at 50gCO 2 /kwh POWER-TO-GAS IN THE UK

23 DEMAND SIDE MANAGED A Matrix of possibilities: Accessing renewable power via the grid Grid balancing DSM Utilising curtailed wind Significant modelling work undertaken Electrolyser CAPEX m Excess Energy 16% 25% 42% 51% Electrolyser Grid 1% 2% 2% 3% Utilisation Total 18% 27% 44% 54% CO 2 footprint of H 2 gco 2 /kwh ch Electrolyser cost p/kwh ch p/kwh e Hydrogen cost p/kwh e p/kwh ch POWER-TO-GAS IN THE UK

24 COMPLIANCE NTS DISTRIBUTION DOMESTIC

25 P2G IN THE NATIONAL TRANSMISSION NETWORK An international network Needs a coordinated approach International standards 0.1% Vol H 2 limit needs revisiting Needs the formation of an international standards group P2G IN THE NTS

26 GAS DISTRIBUTION NETWORK Open and Closed Network Compliance The current 0.1% Vol H 2 is NOT based on safety! Network entry rules are based on gas refineries Recommend revising for small green gas facilities We recommend increasing the GS(M)R limit to 3% Standardise the procedure for exemptions to HSE Form a standards working group specifically looking at hydrogen in the gas grid GAS DISTRIBUTION NETWORK

27 DOMESTIC RENEWABLE GAS OFFERING H 2 Clean Gas Contract for Domestic Customers Analogous to a Green Power contract Therm for Therm offering* Reinvestment in P2G plant *1 therm = 100,000 British thermal units = 29.3kWh DOMESTIC RENEWABLE GAS OFFERING

28 ADDITIONAL APPLICATIONS METHANATION UPGRADING BIOGAS P2G AND FUEL

29 METHANATION Production of SNG from Renewable Hydrogen and CO 2 Need to source (pure) CO 2 Process design can minimise or eliminate storage Multi-stage depending on the level of H 2 compliance METHANATION

30 METHANATION Production of SNG from Renewable Hydrogen and CO 2 Need to source (pure) CO 2 Process design can minimised or eliminate storage Multi-stage depending on the level of H 2 compliance METHANATION

31 CHEMICAL V S BIOLOGICAL METHANATION Production of SNG from Renewable Hydrogen and CO 2 Chemical: An industrial process for ~80yrs. Operates continuously requires considerable storage Biological: Able to follow varying wind profile Minimal buffer storage Parameter Chemical Biological Max scale sold ~500 MW ~500kW Pressure ~50bar Atmospheric, up to 50bar Temp C ~50C Heat produced in reaction Useful Useless Operating range % (needs H 2 storage) 0-100% in <5mins (less H 2 storage) During off periods... No energy required Need to prevent freezing Size of reactor Thin tubes ~ 10m long 3m 3 reactor vessel CHEMICAL VS. BIOLOGICAL METHANATION

32 REMOVING CO 2 FROM BIOGAS Methanation for BioGas CO 2 removal A modular and scalable technology for CO 2 removal BioGas typically min. 35% CO 2 Brings BioGas into Compliance Increases calorific value Increases output DECC Methanation feasibility project in progress High value application REMOVING CO 2 FROM BIOGAS

33 ENERGY HUB FOR P2G & FUEL H 2 Fuel cost reduction using P2G Co-location Energy Hub for P2G and Fuel Reduces the cost of H 2 by maximising electrolyser utilisation More work needed particularly siting and economics ENERGY HUB FOR P2G & FUEL

34 POWER-TO-GAS & METHANATION PATHWAYS TO A HYDROGEN ECONOMY Summary: Renewable power needs energy storage Power-to-Gas is at the required scale Power-to-gas energy storage provides renewable heat A tariff structure comparable to Bio-Methane Recommendation to DECC The 0.1% Vol H 2 legislation needs revisiting in the UK Recommendation to the HSE

35 POWER-TO-GAS & METHANATION PATHWAYS TO A HYDROGEN ECONOMY 14TH ANNUAL APGTF WORKSHOP - LONDON, TH MARCH 2014