EU green hydrogen uncompetitive into 2030s: Aurora
Consultancy Aurora Energy Research expects blue hydrogen and imported green hydrogen to be cheaper than domestically produced green hydrogen in Europe in the medium term, according to a report released today.
European hydrogen demand could increase eight-fold by 2050, as countries work toward net zero, Aurora said. Hydrogen consumption rises to 2,500TWh by 2050 in a high-use scenario, where heating switches to hydrogen. By comparison, the European power system is currently around 3,000-3,3200TWh, Aurora said.
The cheapest source of low-carbon hydrogen by 2030 would be blue hydrogen produced in the Netherlands or Norway, followed by imported green hydrogen from Morocco. Aurora defines blue hydrogen as made from natural gas but combined with carbon capture and storage, and green hydrogen as made from water and electricity using electrolysis.
Green hydrogen from Morocco will be cheaper because power prices are much lower. A large rollout of solar is depressing power prices in Morocco, although it is still building coal-fired capacity. As a result, such green hydrogen may be more carbon intensive than blue hydrogen. This problem will also exist in European countries slow to decarbonise, for example in Germany, which still has a high share of coal and lignite in its power generation mix, Aurora said.
Aurora sees levelised costs of green hydrogen at €91-121/MWh for electrolyser plants built in 2025.
The lower end comes from flexible projects that can optimise production according to power prices. The optimal load factor for such projects would be around 50pc. If the load factor gets too high, it would be running during times of higher power prices, while if it falls too low, the capex costs per MWh produced would rise, Aurora said.
In Britain and Spain, hydrogen from flexible electrolysers will be cheaper than blue hydrogen by the late 2030s. It becomes cheaper in France by the early 2040s, and in Germany by the mid 2040s, Aurora's modelling shows.
Electrolysers co-located with renewable capacity will have higher costs than flexible or inflexible assets using power from the grid. This is primarily because low load factors increase capex — an electrolyser co-located with solar in Spain would have a load factor of just 22pc. Such a plant would still be cheaper than an inflexible asset using grid power in Spain in the 2030s, but will always remain more expensive than a flexible asset, the report said.
Related news posts
Brazil state faces power outages after record flood
Brazil state faces power outages after record flood
Sao Paulo, 6 May (Argus) — Brazil's Rio Grande do Sul state is facing power outages following record floods that killed more than 80 people and forced over 130,000 people out of their homes. The extreme weather took three substations, 25 transmission lines, five hydroelectric plants and 11 power transformers off line, according to grid operator ONS. In response, ONS started importing power from neighboring Uruguay and requested that the 250MW hybrid natural gas and diesel Canoas and 345MW coal-fired Pampa Sul power plants increase power generation. Earlier today, an estimated 435,000 consumers did not have electricity. The rains affected 341 of the 497 cities in the state, where the government declared a state of emergency in 336 municipalities. The government is working to re-establish power to the state as quickly as possible, the mines and energy ministry said in a social media post. The ministry also held an emergency meeting early yesterday and today to guarantee fuel supplies in the state . State capital Porto Alegre is expected to receive more rain later this week, according to Rio Grande do Sul-based weather forecaster MetSul. Metsul warned that parts of the Porto Alegre metropolitan area could remain uninhabitable for weeks or months. Brazil's airline association Abear said that the Salgado Filho international airport will remain closed indefinitely, after the airport's runway flooded. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Brazil lowers biofuel mix in flooded state
Brazil lowers biofuel mix in flooded state
Sao Paulo, 6 May (Argus) — Brazil's oil regulator ANP temporarily decreased the mandatory mix of ethanol and biodiesel in fuels in Rio Grande do Sul state for 30 days, starting on 3 May, amid floods in the region. The anhydrous ethanol blend on gasoline was lowered to 21pc from the current 27pc, while the mandatory biodiesel mix for 10ppm (S10) diesel is now at 2pc, down from the usual 14pc. The agency also temporarily suspended the blending mandate for diesel with 500ppm of sulfur (S500). ANP said it can revise deadlines depending on supply conditions in the state. Rainfall in Rio Grande do Sul blocked railways and highways where biofuels are transported to retail hubs, such as Esteio and Canoas. Supply of fossil fuels via pipeline from the 201,000 b/d Alberto Pasqualini refinery (Refap), in Canoas, and other retail bases has not been compromised, ANP said. Floods in Rio Grande do Sul have left at least 83 dead and 111 missing, according to the state government. More than 23,000 people have been forced from of their homes amid widespread damage. Over 330 cities are in a situation of public calamity. By Laura Guedes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Neste inks deal to supply SAF to Singapore's SIA, Scoot
Neste inks deal to supply SAF to Singapore's SIA, Scoot
Singapore, 6 May (Argus) — Finnish biofuels producer Neste has signed an agreement to supply 1,000t of neat sustainable aviation fuel (SAF) from its Singapore refinery to Singapore Airlines (SIA) and Scoot. The blended jet fuel will be delivered from Neste's Singapore refinery to Changi Airport's fuel hydrant system in two batches, once in this year's second quarter and the next in the fourth quarter. The delivered fuel will be a blend of neat SAF, which is made from renewable waste and residue raw materials, and conventional jet fuel. But the exact ratio of the two remains undisclosed. Neste's Singapore facility has a production capacity of 1mn t/yr of SAF, making it the world's largest SAF plant, according to Neste. The firm completed an expansion of its refinery in May 2023 . Neste is also the only company in Singapore producing SAF after Shell scrapped plans to set up a biofuel refinery in the city-state . The delivery from Neste's Singapore refinery to Changi Airport's fuel hydrant system cements the firm's end-to-end SAF supply chain capabilities in the country. Neste is also a minority shareholder at Changi Airport's fuel storage and infrastructure joint venture Changi Airport Fuel Hydrant Installation, to offer blended SAF directly to airlines at the airport. The SIA group aims to use a minimum of 5pc of SAF in its total fuel uplift by 2030, according to the group's chief sustainability officer Lee Wen Fen. This comes as Singapore mandates a 1pc SAF use for flights departing from Singapore from 2026, alongside a SAF levy, in their sustainable airhub blueprint on 19 February. The mandate is projected to rise to 3-5pc by 2030, subject to global developments and wider SAF availability and adoption, according to the blueprint. SIA to offer BCUs SIA will also offer 1,000 SAF book and claim units (BCUs) for purchase by its corporate customers starting from May, with each BCU representing 1t of neat SAF with its associated CO2 reduction benefit. This allows corporate travellers, shippers, and freight forwarders to claim the associated environmental benefits for flights related to their business travel and operations under the Roundtable on Sustainable Biomaterials (RSB) book and claim system, to ensure traceability and credibility of the transactions. By Deborah Sun Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Fire hits Vance Bioenergy's Pasir Gudang facility
Fire hits Vance Bioenergy's Pasir Gudang facility
Singapore, 6 May (Argus) — A fire broke out at Malaysian biodiesel producer Vance Bioenergy's Pasir Gudang facility in southern Johor today, but did not affect biodiesel production, said sources close to the company. Some auxiliary products were affected, a source said but declined to name them because of commercial sensitivity. The cause of the fire is still under investigation. Vance Bioenergy produces biodiesel for the Malaysian and European markets, but there has been limited market reaction to the news so far. The company has a total biodiesel production capacity of 450,000 t/yr, with 300,000 t/yr at Tanjung Langsat and 150,000 t/yr at Pasir Gudang. By Sarah Giam Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more