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How e-methanol can enable the hydrogen economy while adding value to captured carbon

How e-methanol can enable the hydrogen economy while adding value to captured carbon

Hydrogen (H2), with its unique characteristics, is considered an important component of the decarbonization roadmap. It can be easily produced by electrolysis of water, has extremely high energy density, and burns cleanly, producing only moisture in the process. In addition to its application as long duration storage, it can also be used as a fuel or a feedstock for important industries like fertilizers, steel, and petroleum.

Despite its advantages, H2 faces some important challenges that need to be resolved before it can achieve widespread application. Among them, the most critical are storage and transportation. Its low density and small molecular size make it possible for hydrogen to penetrate through most metals and polymers. This, combined with the potential for hydrogen to embrittle steel structures and damage pipes when under compression, limits pipeline transportation options.

To support the potential to grow the use of hydrogen as an energy commodity, innovative, efficient, reliable, and affordable solutions for its transport are needed. E-methanol offers a solution.

Understanding hydrogen transportation options

Long-distance transportation of hydrogen is one of the most challenging issues in the energy sector. H2 is an extremely light gas with low volumetric energy density. To achieve reasonable volumetric energy density to enable storage and transport via truck or container, it must be compressed or liquefied, both of which consume energy and reduce its net energy available. While natural gas can be easily stored at pressures up to 200 bar, reasonable H2 storage pressure is in the range of 600 bar, which requires more sophisticated equipment with higher energy inputs and results in even lower net energy value. Further, due to its small molecular structure, H2 leaks out of most reservoirs (other than salt caverns), resulting in further net energy losses.

Transport on the existing natural gas pipeline network faces even steeper challenges in addition to leakage through polymer pipes and fittings. At higher pressures, H2 can embrittle steel, which makes much of the existing gas pipeline infrastructure incapable of safely transporting H2 at typical natural gas pressures. The existing natural gas pipeline infrastructure was not designed for hydrogen and would need significant investment to be fully repurposed.

To support the potential to grow the use of hydrogen as an energy commodity, innovative, efficient, reliable, and affordable solutions for its transport are needed. These vary from simple physical compression described earlier to converting hydrogen to different chemical compounds for transport. Altering the state of hydrogen typically results in higher densities which increase the transport options available.

Table 1 compares different methods and modes of H2 transport and their parameters along with diesel, a commonly used fuel, as a reference.

Compression and liquification are physical methods to increase energy density of hydrogen. Compressed gaseous hydrogen can be delivered by tube trailers while swapping out trailers of full cylinders for empty ones. It is one of the simplest modes and is well suited for smaller distances. Liquid hydrogen consists of liquifying hydrogen by reducing its temperature and requires cryogenic systems. It can be delivered by tankers or trucks capable of maintaining liquid H2 at a low temperature that would typically pump hydrogen into an above-ground cryogenic tank.

Hydrogen can also be stored and transported as liquid organic hydrogen carriers (LOHC)—compounds that chemically bind hydrogen at low pressures and can extract hydrogen at the destination site through hydrogenation. These carriers need elaborate conversion mechanisms and are generally exclusively hydrogen carriers with no alternative large-scale application for the LOHC.

A third mechanism involves converting hydrogen into other commonly used chemicals like ammonia or methanol which already have an existing market beyond acting as an H2 carrier.

Both methanol and ammonia have much higher energy density than the physical methods and are much easier to store and transport. For example, methanol has an energy density of 15.8 MJ/L which is three times more than compressed hydrogen at 690 bar (4.5MJ/L). Its liquid form at room temperature allows storage with already-existing infrastructure, and it can be transported using existing infrastructure for liquid hydrocarbon transport.

Beyond ease of storage and transport, the fact that these chemicals may be used as a feedstock by themselves or converted back to hydrogen at the destination—depending on the end-use—provides them a distinct advantage. Ammonia is heavily consumed in the fertilizer industry while methanol is used as a feedstock in several industries such as polymers, chemicals, and pharmaceuticals.

Compared to ammonia, methanol has a slightly higher volumetric energy density and does not need to be pressure liquified. However, conversion to methanol has one more interesting advantage. Methanol production consumes carbon dioxide (CO2) and thus it provides a commercial utility for CO2 captured from flue gases.

E-methanol as a mitigation option for CO2

E-methanol is produced by combining green hydrogen and captured carbon dioxide. The process has potential to mitigate CO2 emission to the atmosphere.

Several large-scale carbon dioxide emitters are currently indispensable due to lack of suitable clean alternatives. For example, natural gas power plants play an important role in the stability of electric power systems. These systems are capable of quickly increasing and decreasing their power output and thus match varying electrical demand to generation, which may vary uncontrollably when supplied by solar and wind.

Accordingly, natural gas power plants with no immediate replacement are expected to continue operations in the near future. However, they are point sources of CO2 emission and their emissions can be controlled by providing them with a carbon capture system. The same is true for other essential heavy industries that are large-scale CO2 emitters.

Since flue gas emitted by such plants is a concentrated source of CO2, it is easier to capture CO2 from them, making them economical compared to systems which intend to capture CO2 directly from air. The economics of these systems can be further improved by providing a utility for the captured carbon in the form of producing e-methanol.

Methanol and carbon capture

Methanol is the simplest alcohol with a chemical composition of CH3OH. Around 98 million metric tons of methanol are currently produced primarily from fossil fuels and consumed as feedstock. It can also be produced by reacting green H2 with CO2, a process demonstrated at commercial scale as early as 2011.

Most carbon capture systems rely on sequestering the captured carbon in underground geological formations. While research indicates underground formations may provide effective storage for thousands of years, public concerns exist that may prevent large-scale usage of underground storage for captured CO2. Oppositional residential and community response related to concerns about CO2 leakage, induced seismicity, explosions, and groundwater contamination is anticipated for areas where CO2 storage may be proposed. An alternative to storage is to monetize the captured carbon dioxide. This provides for a sustainable long-term solution with better economics and incentive for the installation of carbon capture equipment. Methanol production from captured carbon provides this monetization alternative.

The cost of carbon capture and transport from a natural gas plant to a hydrogen facility is estimated to be between $50-$80 USD/metric ton depending on technology and cost of transport as represented in Table 2 and Table 3, respectively.

The cost of e-methanol—that is, methanol produced from green hydrogen and CO2—strongly depends on the cost of green hydrogen and, to a lesser extent, on the cost of carbon. According to the International Renewable Energy Agency (IRENA), it is estimated to cost between USD $800-$1,600/metric ton, assuming CO2 is sourced from bioenergy with carbon capture and storage (BECCS) at a cost of USD $10-$50/metric ton.

While the current cost of e-methanol is much higher than grey methanol (derived from fossil fuels), which varies from $100-$250 USD/ton, incentives introduced by the Inflation Reduction Act in the U.S. can drastically reduce cost of both green H2 and CO2 captured from flue gas and make e-methanol production cost comparable to grey methanol.

hydrogen graphic

Methanol for power and transport sectors

Most of the methanol produced today is used as feedstock, and its use as fuel is negligible. However, due to its higher energy density and clean burning characteristics, methanol has been considered a possible alternative fuel in gas turbines and reciprocating engines for decades. Today, with the increasing availability of e-methanol, there is an increased push for its use in such applications.

Existing gas turbines that use natural gas can be converted to use methanol. Green e-methanol produced from captured carbon in a power plant can thus be used to produce electricity, making it a circular system, albeit less efficient than using hydrogen directly for power generation. The biggest advantage would be easier storage and logistics of methanol compared to hydrogen.

It should be noted, however, that methanol is expected to command a higher price as a feedstock in the industry than as a fuel in a power plant, making its use in the power sector less likely.

Nevertheless, e-methanol can replace diesel economically as a carbon-neutral fuel. Recently, for example, Wärtsilä provided methanol-fueled engines for an offshore turbine installation vessel and Rolls-Royce and Aura Marine launched new methanol engines for marine applications. Similarly, Maersk has 19 green methanol vessels on order and considers methanol as the “best scalable green fuel solution for this decade.” The largest deterrent to widespread use of methanol in the shipping industry is the currently limited production capability.

Enabling long-term multi-sector decarbonization

Hydrogen and e-methanol have a strong and complementary role in economy-wide decarbonization. Similar to hydrogen, e-methanol can help decarbonize certain sectors where options are currently limited, such as a feedstock in the chemical industry or as a fuel in marine transport. While hydrogen may be difficult to store and transport for applications in areas remote to its production, e-methanol is easily stored, transported, and distributed. It has potential to help decarbonize the power sector and enhance the power system reliability by providing an offtake market for captured carbon from fossil generators. Overall, it can prove to be an important and symbiotic tool in supporting long-term decarbonization.

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Meet the authors
  1. Mike McCurdy, P.E., Managing Director, Energy Advisory Services

    Mike McCurdy is an energy expert with more than 24 years of experience guiding lenders, developers, and select government clients in the financing, sale, and purchase of energy assets. He specializes in photovoltaic, power, renewable chemical, renewable fuels, geothermal, and food processing markets.  View bio

  2. Pradeep Podal, Manager, Energy Markets

    Pradeep is an energy expert with more than 15 years of experience spanning energy engineering to wholesale and retail U.S. power markets. View bio