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    Pyrolysis Lifts Prospects for Hydrogen From Natural Gas [Brussels Conversation]

Summary

The demand for clean energy and new materials means a new lease of life for old technologies, such as pyrolysis.

Clean hydrogen can significantly improve the European Union (EU)’s chances of decarbonising its economy and pyrolysis could be the main way of producing it, according to a new study by energy advisors Poyry Management Consulting.

by: Sonja van Renssen

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Pyrolysis Lifts Prospects for Hydrogen From Natural Gas [Brussels Conversation]

Clean hydrogen can significantly improve the European Union (EU)’s chances of decarbonising its economy and pyrolysis could be the main way of producing it, according to a new study by energy advisors Poyry Management Consulting.

It is the first European decarbonisation study to consider methane pyrolysis as a third clean hydrogen production method alongside steam methane reforming (SMR) with carbon capture and storage (CCS) and water electrolysis powered by renewables.

The study was commissioned by the German gas sector's trade association Zukunft Erdgas, which argues that “green" gas is indispensable to the German Energiewende and wider European and global energy transitions to a low-carbon economy.

Zukunft Erdgas chairman Timm Kehler, representatives from Poyry and a leading authority on pyrolysis, Alberto Abanades, a professor at Universidad Politecnica de Madrid (UPM), came to Brussels June 21 to present the study.

Getting the volumes

They found fertile ground for their pitch at the end of a week that had featured a whole host of clean hydrogen events. EU Sustainable Energy Week (17-21 June) this year included events from the German energy agency (Dena) on electrolysis-driven “powerfuels" and the northern Netherlands on a cross-sectoral hydrogen economy.

An official from the European Commission (EC)’s energy department told the Dutch event that hydrogen features in every single one of its eight net zero emissions scenarios for 2050. It can get the EU closer to net zero emissions at less cost.

Producing clean hydrogen at scale requires two things, most stakeholders say: demand from energy-intensive industries (only they can provide the volumes to bring down costs; using hydrogen in transport, in contrast, is seen as important to build up public acceptance) and “blue” hydrogen from natural gas en route to "green" hydrogen from electrolysis.

Many of the hydrogen initiatives out there, including the northern Netherlands, say their ultimate goal is green hydrogen, but blue hydrogen will play an important transitional role in making clean hydrogen available in sufficient volumes to boost and integrate different sectoral uses, and ensure competitive pricing.

No need for CCS

The Poyry study takes a different view. It posits that blue hydrogen will make up 85% of all hydrogen production in 2050, with electrolysis supplying only the last 15%. Moreover most of this blue hydrogen (two-thirds) comes from a technology that has yet to enter the Brussels lexicon: pyrolysis. 

Pyrolysis is the thermal cracking of methane to produce hydrogen and solid carbon, and so it does away with the need for CCS – a problem in places like Spain where there are no depleted gas reservoirs. Much like power to gas, the technology has existed for decades but may be on the verge of a new lease of life. Looming demand for clean hydrogen gives it a potential market and the recent transfer of liquid metal technology from the nuclear sector gives it a new production method.

In short, natural gas is fed into a bubble column reactor filled with liquid tin at more than 1,000 °C. The heat splits the gas into hydrogen and carbon black, or pure carbon in solid form. The heat for the process comes from the hydrogen produced (10-15% of it).

The solid carbon is actually a valuable raw material that can feed into new and existing markets. Natural graphite – or, solid carbon – has been on the EU’s critical raw materials list since this was created in 2011.

Europe imports virtually all (99%) of its graphite, and two thirds of it come from China. Just over half of it goes into steel making, but it also feeds into high-tech industries such as Li-ion battery production. Meanwhile there is growing interest in the production of new, carbon-based materials such as graphene. The EU’s biggest research and development initiative to date is its Graphene Flagship project, worth €1bn ($1.12bn).

“The cost that could be given to carbon [from pyrolysis] would grow the market,” Abanades said in Brussels. “From 1mn metric tons of oil equivalent of hydrogen, you would produce 100m mt of carbon. It would become very cheap.”

Moreover the pyrolysis units could be deployed close to the end-user, he added, to make maximum use of existing natural gas networks.

Limitations

The professor suggested that pyrolysis could produce hydrogen at €2/kg and solid carbon at €0.60/kg if there is a market for both given a natural gas price of €8.3/mn Btu.

If the hydrogen alone could be sold, its production cost goes up to €3.8/kg. If natural gas prices are €2/GJ (€1.9/mn Btu – even cheaper than the US) then the production cost of hydrogen and carbon is halved. These costs are for an industrial-scale facility that could be available around 2030, Abanades told NGW.

For comparison, regular “grey" hydrogen made from SMR without CCS costs about €1.50/kg today. With CCS, costs go up to €2-3/kg. Green hydrogen from electrolysis costs €3.50-6.00/kg.

Poyry believes that SMR with CCS will ultimately remain the cheapest way of producing clean hydrogen, but argues that CCS will not be feasible in most of Europe because of technical or political obstacles. It limits CCS to Norway, the UK, Belgium, Denmark, Ireland, the Netherlands and Poland.

In contrast, pyrolysis and electrolysis are available everywhere. Poyry consultant Benedikt Unger explained that their study has a lot less electrolysis than other studies because it takes into account flexible demand. In other words, there are few periods of surplus renewables production (and hence, cheap power prices) because appliances like electric vehicles will adjust their charging times to soak this up.

In sum, electrolysis will be deployed where it is economically viable, SMR with CCS where it is possible and pyrolysis everywhere else. Poyry forecasts hydrogen use across all sectors, and especially in heating. 

Making it happen

Poyry’s study concludes that natural gas demand in Europe in 2050 will be similar to what it is today, or about 500bn m³. This will be music to the ears of the European gas industry. The key to making it happen is a European policy framework for clean hydrogen. So far, this does not exist. But there are encouraging signs.

There is a European gas market reform tentatively pencilled in for 2020 that is expected to take up the issue of hydrogen. There are reviews of EU laws on renewables and truck emission standards in the early 2020s that could lead to demand for clean hydrogen by setting a sub-target for clean gases or letting them count towards the truck standards, respectively.

In the meantime, the EC has identified hydrogen technologies as one of six strategic industrial priorities, an official at its industry department told the Dutch event. This makes the sector a candidate for public-private partnerships called 'important projects of common European interest' that can apply for flexibility on EU state aid rules.

For its part, the European sector is talking about targets, subsides and carbon pricing. “We need a clear target for green gas that includes hydrogen from natural gas, renewable gas from electrolysis as well as biogas,” said Kehler in Brussels.

Zukunft Erdgas and Poyry presented their study the morning after European heads of state and government narrowly failed to sign off on net zero emissions by 2050. But most of Brussels believes that it is just a matter of time. Carbon neutrality is the end goal and the European gas industry intends to help make it happen.

 


The Brussels Conversation

Monthly column by Sonja van Renssen from the EU capital on the developments affecting natural gas.