India's state-owned Numaligarh Refinery (NRL) has picked a conventional fossil-fuelled hydrogen plant, over electrolytic or carbon capture enabled technology, for its hydrogen supply for cost and practical reasons.
NRL — which is owned by a consortium of state-run explorer Oil India, state-controlled engineering and construction firm Engineers India and the Assam government — has contracted US-based industrial gas firm Matheson Tri-Gas (MTG) for its 20-year hydrogen supply at the plant in Assam in northeast India. The US firm will build a new 285t/d hydrogen plant to open in 2025. It will use natural gas, LPG and naphtha feedstocks from NRL without capturing emissions, according to Matheson's parent company Japan-based Nipon Sanso Holdings (NSHD).
Matheson and NSHD can offer CO2 capture solutions but must respect the conditions set by the customer, NSHD said. "We should evaluate not only the environmental affect but economics during the transition period," it said.
NSHD said electrolysers were not viable for the project based on the "current status of the technology and of the [electricity] grid".
The refinery lacks the land to install the 600MW of renewables which would be needed, while using India's mostly fossil-powered grid would result in hydrogen with a carbon footprint 2.5-4 times higher than the proposed solution, NSHD said.
The company did not address the feasibility of using a renewable power purchase agreement.
Employing electrolysers would have "an extremely negative impact on the economic welfare of our customer and the tax paying citizen in India," NSHD said.
The hydrogen and co-product steam will support the expansion of the NRL complex, which is growing to 180,000b/d from 60,000 b/d.
"Unfortunately, it is impossible to jump to a carbon neutral society in one step," NSHD said. "We need to develop technologies for reducing carbon emissions in a pragmatic way".
Numerous renewable hydrogen and ammonia projects have been proposed in India and other developing countries, but most are for the second half of the 2020s or later. And they are often geared towards lucrative export markets as opposed to domestic industries, which are not always able to absorb higher costs.
The decision presents a reality check for proponents of low carbon hydrogen that costs must fall, technology must mature, and policy pressure may be needed to sway cost-minded customers especially in developing countries.
