By Kurt Duncan
- Four paths to creating hydrocarbons from CO2 and water are examined.
- The required cost of electricity to generate an energy equivalent gallon of diesel is estimated for each path.
How Much Electricity? And What’s the Cost?
It’s a pretty daunting task to decarbonize the global economy. Two sectors have dominated the conversation around decarbonization: power generation and personal vehicle transportation. However, this only addresses a small fraction of global carbon emissions. We still need to address emissions from residential and commercial space heating, industrial feedstocks and process heat, aviation, and heavy transportation via trucks, trains, and ships. Modern society depends on chemical fuels to fulfill all of these energy needs, and for good reason. Chemical fuels are energy dense and easy to transport which makes them extremely useful as a power source for transportation applications. They also have a long shelf life, are cheap to store in bulk, and are highly dispatchable which makes chemical fuels an ideal medium for energy storage. The only problem with chemical fuels is that they are derived from fossil sources.
But they don’t have to be.
Synthetic Fuels (aka synfuels, efuels, electrofuels, power-to-fuels, etc.) are chemical fuels that use electrical power to turn commonly available feedstocks into energy dense gasses or liquids. They can come in many forms, but I’ll only be focusing on drop-in replacement hydrocarbons like gasoline, diesel, and jet fuel in this article. Synthetic hydrocarbons are molecularly identical to their fossil-derived counterparts, meaning they can be used directly in existing equipment and infrastructure. It is difficult to understate the massive capital cost savings that we could realize by utilizing the existing fossil infrastructure for synthetic fuels – almost all other decarbonization alternatives, including electric vehicles, require truly massive investments into significantly increasing the electrical transmission and distribution infrastructure. Synthetic hydrocarbons are considered a “silver-bullet” solution because they require no behavioral changes on the part of the consumer or in any other sector of the economy outside of primary energy sourcing. Synthetic fuels are made by extracting carbon dioxide from the atmosphere and hydrogen from water, thus closing the carbon cycle, making them carbon neutral.
A big question around synthetic fuels is their cost. We’ll need to use power from carbon neutral sources like nuclear, hydro, wind, and solar to build up these useful chemical fuels from carbon dioxide and water.
How much electricity is required to make these fuels, and what does this electricity need to cost, in order to make synthetic fuels competitive with their fossil counterparts?
In order to answer those questions, we first need to understand how these fuels are made. There are a myriad of processes that are being investigated in order to convert electrical power into chemical fuels. I want to highlight four process paths that in my opinion have the greatest potential for synthetic hydrocarbon production. The first three paths all utilize gaseous carbon dioxide and hydrogen, while the last path utilizes an aqueous process.
Path A: Electrolysis for Methane Production via Sabatier Reaction
Use H2 from water electrolysis and gaseous CO2 from biomass or active direct air capture (DAC) as a feedstock for Sabatier Reaction to produce methane. This methane can be used directly or further converted into longer-chain hydrocarbons.
- A major downside to the Sabatier Reaction is that half the input hydrogen is consumed in stripping the oxygen from CO2, forming H2O. While the Sabatier Reaction is exothermic, it is difficult to reuse this heat to produce more hydrogen from water. However, this waste heat can be useful if a thermal DAC method is used, or the heat can be used in downstream Fischer-Tropsch (FT) synthesis reactions. Otherwise, significant efficiency losses are accrued converting this heat into electricity to drive water electrolysis.
- If CO is used as a feedstock instead of CO2, the efficiency loss from hydrogen consumption is halved. Utilizing traditional processes, direct conversion of CO2 to CO is an energy intensive process that requires a minimum temperature of 700°C. However, there are new nanoscale technologies that may be able to significantly reduce the energy requirements for this reaction, thus improving overall process efficiency. Methods utilizing electrolysis of aqueous CO2 to form CO are also being explored. However, any efficiency improvements from these experimental processes are not considered in this analysis due to the unproven nature of the technology.
Path B: Electrolysis for Long Chain Hydrocarbons via Fischer-Tropsch
Use H2 from water electrolysis and gaseous CO2 from biomass or active DAC as a feedstock for Fischer-Tropsch (FT) processes to form long chain hydrocarbon fuels (gasoline, jet fuel, diesel), lubricants, or polymers (plastics).
- As with Path A, the oxygen must be removed via reaction with H2 to produce H2O, representing a loss in efficiency.
- Fisher-Tropsch relies heavily on distillation towers, which reduce efficiency and increase capital requirements.
Path C: Electrolysis + CO2 Hydrogenation to Produce Methanol
Use H2 from water electrolysis and gaseous CO2 from biomass or active DAC as a feedstock for carbon dioxide hydrogenation for methanol (CH3OH) production. Methanol is a liquid alcohol that can be used directly as a gasoline substitute with only minor modifications to engines and distribution infrastructure, or it can be up-converted into long-chain hydrocarbons. Methanol is commonly used today to produce plastics.
- Overall better efficiency than the above paths; methanol contains an oxygen so only 1/3rd of the hydrogen used in lost in the formation of H2O vs ½ loss of Paths A and B.
- Methanol has about half the energy density of gasoline, which is why there is an interest in up-converting methanol to longer chain transportation fuels like gasoline or kerosene (jet fuel)
Path D: Passive CO2 Atmospheric Dissolution Into Water to Produce Methanol
Use H2O and aqueous CO2 from passive atmospheric dissolution into water for methanol production. As in Path C, this methanol can be used directly or up-converted.
- The methanol (an alcohol) must be separated from water either through reverse osmosis or through distillation. Distillation is a thermal process, and any thermal process step adds inefficiencies.
- This process has a higher potential efficiency than the other Paths for several reasons:
- No active carbon capture step
- No hydrogen loss – atomic hydrogen is directly consumed at electrode and doesn’t form H2
- No initial phase change – process takes place in aqueous environment, meaning no entropy losses associated with gas to liquid conversion.
- Alcohol separation can be accomplished via reverse osmosis which further improves efficiency, although this method is patented.
- This process is rate limited due to low current densities in the electrode as well as diffusion rates of the dissolved CO2 within the electrolyte – it takes time for new dissolved CO2 to move to replace the CO2 that was consumed close to the electrode.
Due to the complex nature of the above processes, it is difficult to determine the overall process efficiencies of the various paths. However, estimations can be made based on thermal cycles and phase changes. The maximum theoretical efficiency of Paths A, B, and C are around 30% due the reliance on thermal processes and phase shifts, while the theoretical efficiency for Path D is around 55% when using the patented reverse osmosis separation step. While this is a high-level overview, it is worth doing a deeper dive into each of these paths in order to arrive at a more accurate efficiency factor.
The energy cost of direct air carbon capture used in Paths A, B, and C should not be ignored. Carbon Engineering, which uses state-of-the-art “sorbent” carbon capture technology, estimates that it uses 8.8GJ per tonne of captured CO2. Burning a gallon of gas releases 8.89*10^(-3) tonnes of CO2, therefore it takes 7.82*10^7 J/gallon to capture the required CO2 to produce a gallon of gasoline. For simplicity’s sake, we’ll only consider the production of gasoline moving forward.
The next step in answering our question is to understand the cost of electricity:
- 1 kwh electricity = 3,600,000 Joules (3.6*10^6 J)
- From EIA report (table 5.6, pdf warning), avg industrial cost per kwh in June 2019 was $0.0691/kwh to industrial customers, $0.1089/kwh to commercial customers, and $0.1334/kwh to residential customers
- Note that this is just for average price of electricity taken across the whole sector. Per kwh prices of solar and wind are much lower than this, and since the goal is to be carbon neutral, we’ll have to use carbon neutral electricity sources like solar, wind, hydro, and nuclear.
- It is worthwhile to know these prices as a benchmark in order to determine if it is more economically beneficial for a carbon neutral energy source (wind, solar, hydro, nuclear) to sell its power to the grid or to a synthetic fuels manufacturer. However, during times of overproduction of wind or solar, their price per kwh drops to zero even before the inclusion of government incentives.
Now we can figure out the required price per kwh of electricity in order to produce synthetic gasoline that is directly competitive with fossil gasoline. First, let’s determine the equivalent energy cost of a gallon of fossil gasoline:
- 1 US gallon gasoline contains 122,481,434 Joules (1.22*10^8 J)
- According to Gas Prices Explained, US gasoline average retail price in June 2019 was $2.72/gallon. Taking out taxes and transportation costs of getting from refinery to retail gas pump comes out to $1.768/gallon
- Note that gasoline prices in the US are heavily subsidized – the retail price of gasoline in Europe was roughly $7/gallon for the same period.
- Gasoline costs as of June 2019: $1.45*10^(-8)/J
From here, we’ll work backwards to determine the required price of electricity in order to produce competitive synthetic gasoline.
For paths A, B, and C:
- 1.22*10^8 J/gallon / 0.3 (process efficiency) = 4.07*10^8 J required to produce gallon of synthetic gasoline without carbon capture
- 4.07*10^8 J + 7.82*10^7 J (energy for carbon capture) = 4.85*10^8 J/gallon for synthetic gasoline production including DAC
- 4.85*10^8 J/gallon / 3.6*10^6 J/kwh = 134.685 kwh/gallon
- $1.768/gallon / 134.685 kwh/gallon = $0.0131/kwh to produce a gallon of synthetic gasoline that costs the same as a gallon of fossil gas. This does not include CAPEX or other operational costs, just direct energy cost.
- Note that to produce synthetic gasoline using these methods at a price of $5/gallon (for markets outside the US) would require an electricity cost of $0.0371/kwh, which is achievable in some power markets, and requires the cost of electricity to industrial customers to be halved.
For Path D, which does not require DAC or thermal distillation:
- 1.22*10^8 J/gallon / 0.55 (process efficiency) = 2.218*10^8 J required to produce a gallon of synthetic gasoline with passive aqueous carbon capture
- 2.218*10^8 / 3.6*10^6 J/kWh = 61.616 kWh/gallon
- Note that this process uses only 45% of the energy that processes A, B, and C use.
- $1.768/gallon / 61.616 kwh/gallon = $0.0287/kwh to produce a gallon of synthetic gasoline the costs the same as a gallon of fossil gas. This does not include CAPEX or other operation costs, just direct energy cost.
- Note that to produce synthetic gasoline using this method at a price of $5/gallon (for markets outside the US) would require an electricity cost of $0.0811/kwh, which is already achievable with current industrial electricity rates.
Based on this analysis, each of these paths has significant economic potential. Path D appears to be able to produce synthetic gasoline at a competitive price point to fossil gasoline at current electricity rates. This path is being commercialized by a few different startups, but relies on unproven technology. Paths A, B, and C rely on mature, proven technologies that are well understood by industry. They appear to be more energy-intensive, but are well within the competitive reach of fossil gasoline, especially when priced for markets outside the US or for environmentally-conscious consumers.
While I believe drop-in replacement fossil fuels have the greatest potential, I’d like to take a moment to briefly mention synthetic ammonia. Ammonia (NH3) is an energy-dense fuel that can be used in existing steel pipelines and as a near-drop-in replacement for LNG in grid-scale generators (very minor retrofits required) that does not require an energy-intensive carbon-capture step. Ammonia is being viewed as a way to help decarbonize the agricultural industry (fertilizer) and also as a way to export renewable energy (ex: solar in Australia is used to make ammonia which is then shipped to Japan where it is burned in existing LNG generators). Ammonia is also being viewed as a hydrogen carrier and as a way to decarbonize industrial processes that rely on blast furnaces (ie: steel, cement) via cracking the ammonia back into hydrogen. Finally, there are many companies designing ammonia combustion engines for marine use as a way to decarbonize the shipping industry. Note that ammonia manufacture is already a large-scale industry with existing distribution infrastructure across most developed countries. However, this industry is fossil-based and needs to be decarbonized. I plan on doing an economic analysis of synthetic ammonia in the future.