South Korea opens hydrogen power bidding market
South Korea has opened today what it describes as the world's first hydrogen bidding market, according to the country's Ministry of Trade, Industry and Energy (Motie).
There will be two bidding rounds held this year, with one that will start on 9 June and the other in this year's second half. This round's bidding volume of 650GWh is half of the 1,300GWh for this year.
The hydrogen power generation bidding market will allow power producers to sell electricity generated from hydrogen or hydrogen compounds to state-owned Korea Electric Power and other domestic power utilities.
South Korea's government views the introduction of hydrogen power generation as essential to achieving nationally-determined contribution targets, expecting it to cut greenhouse gas emissions by about 8.3mn t by 2030 from 2027 levels.
The ministry expects the bidding market to promote competition among hydrogen power generation technology, reducing the unit price of power generation.
Successful bidders will be selected in mid-August, after Motie's evaluation of various non-price indicators such as the price index, the impact on the power system, as well as industrial and economic contributions.
The clean hydrogen power generation market will only open in early 2024, after a clean hydrogen certification system and relevant laws are enacted.
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New technologies aim to boost SAF production
New technologies aim to boost SAF production
London, 26 April (Argus) — A likely rise in global demand for sustainable aviation fuel (SAF), underpinned by mandates for its use, is encouraging development of new production pathways. While hydrotreated esters and fatty acids synthesised paraffinic kerosine (HEFA-SPK) remains the most common type of SAF available today, much more production will be needed. The International Air Transport Association (Iata) estimated SAF output at around 500,000t in 2023, and expects this to rise to 1.5mn t this year, but that only meets around 0.5pc of global jet fuel demand. An EU-wide SAF mandate will come into effect in 2025 that will set a minimum target of 2pc, with a sub-target for synthetic SAF starting from 2030. This week the UK published its domestic SAF mandate , also targeting a 2pc SAF share in 2025 and introducing a power-to-liquid (PtL) obligation from 2028. New pathways involve different technology to unlock use of a wider feedstock base. US engineering company Honeywell said this week its hydrocracking technology, Fischer-Tropsch (FT) Unicracking, can be used to produce SAF from biomass such as crop residue or wood and food waste. Renewable fuels producer DG Fuels will use the technology for its SAF facility in Louisiana, US. The plant will be able to produce 13,000 b/d of SAF starting from 2028, Honeywell said. The company said its SAF technologies — which include ethanol-to-jet , which converts cellulosic ethanol into SAF — have been adopted at more than 50 sites worldwide including Brazil and China. Honeywell is part of the Google and Boeing-backed United Airlines Ventures Sustainable Flight Fund , which is aimed at scaling up SAF production. German alternative fuels company Ineratec said this week it will use South African integrated energy firm Sasol's FT catalysts for SAF production. The catalysts will be used in Ineratec's plants, including a PtL facility it is building in Frankfurt, Germany. The plant will be able to produce e-fuels from green hydrogen and CO2, with a capacity of 2,500 t/yr of e-fuels beginning in 2024. The e-fuels will then be processed into synthetic SAF. Earlier this month , ethanol-to-jet producer LanzaJet said it has received funding from technology giant Microsoft's Climate Innovation Fund, "to continue building its capability and capacity to deploy its sustainable fuels process technology globally". The producer recently signed a licence and engineering agreement with sustainable fuels company Jet Zero Australia to progress development of an SAF plant in north Queensland, Australia. The plant will have capacity of 102mn l/yr of SAF. Polish oil firm Orlen formed a partnership with Japanese electrical engineering company Yakogawa to develop SAF technology . They aim to develop a technological process to synthesise CO2 and hydrogen to form PtL SAF. The SAF will be produced from renewable hydrogen as defined by the recast EU Renewable Energy Directive (RED II) and bio-CO2 from biomass boilers, Orlen told Argus . By Evelina Lungu Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
EPA backs out of H2 mandates for power plants
EPA backs out of H2 mandates for power plants
Washington, 25 April (Argus) — The US Environmental Agency (EPA) omitted hydrogen co-firing mandates in the standards it released today to cut emissions from US power plants. The future delivered cost of hydrogen is higher than EPA anticipated last year when it proposed standards that would have given gas-fired power plants the option to co-fire with at least 30pc low-carbon hydrogen or deploy carbon capture and sequestration (CCS) by 2032, and mandated that baseload power plants co-fire with 96pc hydrogen by 2038. EPA at the time modeled that hydrogen would be available at a delivered cost of $0.50/kg by 2032. But EPA is now modeling a delivered cost of $1.15/kg, accounting for Inflation Reduction Act subsidies, which is still ambitious depending on the production pathway used and the recovery of infrastructure or transportation costs. The power sector is only willing to pay $0.40-0.50/kg for hydrogen, a DOE report had estimated last year . The agency was uncertain that enough low-carbon hydrogen would be available in the future to make the standard realistic, it said. While EPA will not consider hydrogen co-firing as a "best system of emission reduction" for power plants, it will establish standards of performance for plants that may opt to co-fire hydrogen in the future. This leaves the option open, but the effect on the hydrogen industry will be a far cry from the initial 320,000 t/yr in demand that EPA had previously expected to create. EPA also abandoned its proposal to set a carbon intensity standard for hydrogen used in co-firing, after previously eyeing a standard of less than 0.45kg of CO2 per kilogram of hydrogen. It would not be helpful to issue a definition while the industry waits for the Treasury to issue final tax credit rules that will set the boundaries on what hydrogen can be considered clean, it said. Hydrogen "regardless of production pathway" will meet EPA's uniform fuels criteria for low load combustion turbines. But the power sector will still need to compete with other hydrogen offtakers in industrial and heavy transport sectors. For this reason, it is improbable that limited conventional hydrogen supply today would be redirected to power plants, which would incur only extra transportation costs without emissions reduction benefits. Even as clean hydrogen production eventually comes online, its users will be co-located with production, which would limit the number of customers that could be found in power plants. Hydrogen combustion is already technically feasible in some combustion turbines and EPA said it may reevaluate its decision as the industry develops. But without a vast quantities of low-carbon hydrogen on the market, it should be prioritized for efficient units rather than boilers or gas-fired steam generating units, EPA said. By Emmeline Willey Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
UK publishes SAF mandate, targets 22pc by 2040
UK publishes SAF mandate, targets 22pc by 2040
London, 25 April (Argus) — The UK will mandate the supply of sustainable aviation fuel (SAF) from next year, targeting a 2pc share in 2025, which equates to around 230,000t of SAF according to the government, and increasing the obligation annually to 10pc in 2030, 15pc in 2035 and 22pc in 2040. The obligation, which falls on the jet fuel supplier, will remain at 22pc from 2040 until it is reviewed and updated, the UK said. The mandate is subject to parliamentary approval. An EU-wide SAF obligation is also due to come into effect next year, targeting a 2pc SAF share in 2025, increasing to 6pc from 2030, 20pc from 2035, 34pc from 2040, 42pc from 2045 and 70pc in 2050. Under the new UK mandate, hydrotreated esters and fatty acids (HEFA) SAF can be used to meet 100pc of SAF demand in 2025 and 2026, but it will be capped at 71pc in 2030 and 35pc in 2040. HEFA is the most common type of SAF today, and is expected to account for over 70pc of global production by the end of the decade, according to Argus data. An obligation for Power-to-Liquid (PtL) SAF will be introduced from 2028 at 0.2pc of total jet fuel demand, rising to 0.5pc in 2030 and 3.5pc in 2040. The EU is targeting a 1.2pc share of synthetic aviation fuels in 2030, rising to 2pc in 2032, 5pc in 2035 and 35pc in 2050. To be eligible under the mandate, SAFs must achieve minimum greenhouse gas (GHG) reductions of 40pc compared with a fossil fuel jet comparator of 89g CO2e/MJ, and must be made from sustainable wastes or residues, such as used cooking oil or forestry residues. SAF from food, feed or energy crops is currently not eligible for support under the scheme, the government said. PtL SAF will need to be produced from low carbon — renewable or nuclear — electricity. Recycled carbon fuels (RCF) from feedstocks like unrecyclable plastics can also be used to meet the obligation. Hydrogen, whether used as fuel precursor or as final fuel, must be bio-hydrogen from wastes and residues, RCF hydrogen or derived from low carbon energy. The mandate will also introduce tradeable certificates for the supply of SAF, with additional certificates awarded for fuels with higher GHG emissions savings. There will be three types of certificates: PtL, standard and HEFA. Buy-out mechanisms will be set at the equivalent of £4.70/l and £5.00/l for the main and PtL obligations, respectively. Formal reviews of the mandate will be conducted and published at least every five years, with the first to be carried out by 2030, the government said. The mandate will be separate from the country's Renewable Transport Fuel Obligation (RTFO). In tandem with the publication of the SAF mandate, the government launched a consultation on four options for an SAF revenue certainty scheme aimed at guaranteeing revenue from SAF and support production in the country. The UK previously said it aims to introduce the mechanism, which will be industry funded, by the end of 2026 . The consultation includes a preferred option for a "guaranteed strike price" (GSP), which would guarantee a pre-agreed price of SAF supplied into the UK market. By Giulia Squadrin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Lithuania more than triples 2030 renewable H2 target
Lithuania more than triples 2030 renewable H2 target
London, 24 April (Argus) — Lithuania has more than tripled its 2030 renewable hydrogen target and now aims to produce 129,000 t/yr from 1.3GW electrolyser capacity, according to the hydrogen roadmap approved by the government today. A previous draft from July last year set a goal of 350MW of electrolyser capacity and 34,000 t/yr production. According to the ministry, the main applications of renewable hydrogen will be fertiliser production, refining and mobility — including use of derivatives such as synthetic fuels. Lithuania can currently produce 264,000 t/yr of hydrogen from natural gas with unabated emissions. The bulk of this, roughly 200,000 t/yr, is used for ammonia production, with the remainder largely going to refineries, which consume over 50,000 t/yr. By 2030, Lithuania could consume around 96,000 t/yr of renewable hydrogen domestically, largely to replace existing grey hydrogen use. Some 82,000 t/yr of renewable hydrogen could be used in fertiliser production to meet EU requirements for 42pc of hydrogen consumption in industry to come from renewable sources by 2030 . While the government did not specify the reasons for the higher production targets, the need to comply with these EU rules — which were finalised in mid-2023 — may have contributed. Additional demand is expected from the transport sector. By 2030, the government aims to have at least 10 hydrogen refuelling stations, with at least one dedicated to the shipping sector. It also aims to have part of the public transport of at least five cities running on renewable hydrogen. The ministry plans to promote up to 10pc of hydrogen blending in the gas network as a way to kickstart the market and increase adoption. The strategy also anticipates use of hydrogen for power generation, primarily as a means of stabilising the grid and for electricity storage. Two hydrogen valleys could be developed — hubs for production and distribution of renewable hydrogen, according to the ministry. One is planned in the northwest of the country to leverage offshore wind potential and exports, while another is foreseen for the central region, which boasts "well-developed electricity transmission network" that could allow surplus power to go towards hydrogen production. Investments of around €4.4bn ($4.7bn) will be needed in the renewable hydrogen sector by 2030, the government said. This is expected to come partly from a mix of EU funding programmes and state investment, and partly from private funds. The government said it will look into implementing subsidies and grants schemes, tax incentives, loan guarantees and financing programmes, while it will also consider measures to streamline permitting. By Pamela Machado Lithuania renewable hydrogen demand targets (t/yr) 2030 2040 2050 Ammonia production 82,000 240,000 472,000 Refining (E-fuels production after 2030) 5,000 92,000 141,000 Transportation 8,000 32,000 51,000 Electricity production 0 0 17,000 Other domestic use 1,000 4,000 7,000 Exports 33,000 51,000 44,000 Total 129,000 419,000 732,000 - Lithuania energy ministry Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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