Techno-economic echno-economic and and Market Analysis of Pathways from Syngas to Fuels and Chemicals
TC Biomass 2013 – Chicago, Illinois Michael Talmadge, Abhijit Dutta & Richard Bain September 4, 2013
Objective Assess the economics of producing fuels and chemicals from biomass-derived synthesis gas. •
Process economics based on literature literature (consistent (consistent TEA assumptions)
•
Perform more rigorous TEA on promising pathways
•
o
Biochemical conversion conversion of syngas to ethanol and higher h igher alcohols
o
Ethanol and higher alcohols to infrastructure-compatible infrastructure-compatible hydrocarbons
Simple product market analyses
What can we do with syngas?
Objective Assess the economics of producing fuels and chemicals from biomass-derived synthesis gas. •
Process economics based on literature literature (consistent (consistent TEA assumptions)
•
Perform more rigorous TEA on promising pathways
•
o
Biochemical conversion conversion of syngas to ethanol and higher h igher alcohols
o
Ethanol and higher alcohols to infrastructure-compatible infrastructure-compatible hydrocarbons
Simple product market analyses
What can we do with syngas?
Analysis Approach •
Simplified TEA model
•
Inputs from literature sources o
o
o
o
•
Common scaling assumptions o
o
•
•
Feedstock rate rate and properties (heating value) Product yields Operating costs (variable & fixed) Capital costs Capital scaling exponents Economies of scale for fixed operating costs
Operating and financing assumptions for n th plant and pioneer plant
Minimum Product Selling Price literature values average, standard deviation & 90% confidence intervals
nth Plant Assumptions Parameter Basis year for analysis Feedstock processing capacity
Value 2011 2,000 Dry Tonnes / SD
Feedstock cost (woody biomass)
$75 / Dry Tonne
Debt / equity for plant financing
60% / 40%
Internal rate of return (after-tax) for equity financing Annual interest rate and term for debt financing Total income tax rate Plant life Plant depreciation schedule Reliability of operations / on-stream factor Site development costs Working capital Indirect costs for capital project Capital equipment capacity scaling exponent
10% 8% / 10 years 35% 30 years 7-year IRS MACRS MACRS = Modified Accelerated Cost Recovery System
0.90 4% of ISBL Installed Capital 5% of Fixed Capital Investment 60% of Total Direct Costs 0.70
Pioneer Plant Assumptions •
Internal Rate of Return (IRR): 10% – 25%
•
Capital Costs: Pioneer Plant Escalation ~ 210% of nth Plant Estimates (Merrow et al, Rand, 1981)
•
Reliability of Operations / On-Stream Factor: Initial value of 0.5 (Merrow et al, Rand, 1981) Increasing to 0.9 per experience curve (Heinen, SRI Consulting, 2001) 1.0
r 0.8 o t c a 0.6 F m a 0.4 e r t S n 0.2 O 0.0 0
2
4
6
8
10 12 14 16 18 20 22 24 26 28 30
Year of Plant Operation
Fuel Pathways Explored Hydrocarbons
Ethanol & C3+ Alcohols
(FT Gasoline, Diesel, Jet, Lubricants)
Ethanol Synthetic Natural Gas
Syngas
Syngas Fermentation
Butanol 2,3-Butanediol
Methanol
Triptyls
Gasoline (MTG)
Dimethyl Ether (DME)
Olefins (MTO)
Chemical Pathways Explored Urea Hydrocarbons (FT Lubes, Waxes)
PHA (Polyhydroxyalkanoates)
Ammonia
Syngas Fermentation
Hydrogen
Syngas
Aldehydes
DME Ethylene Glycol MethylAmines Methanol Methyl Formate
Formaldehyde
Acetic Anhydride
Acetic Acid
Ethyl Acetate
Acetic Acid
Formic Acid
Propylene (MTO) Ethylene (MTO)
(Oxosynthesis)
Major Pathway Categories Explored •
Synthetic Natural Gas via Methanation of Syngas
•
Ethanol
•
o
Catalytic Mixed Alcohol Synthesis
o
Syngas Fermentation *
Hydrocarbons o
Fischer-Tropsch
o
Methanol to Naphtha Hydrocarbons
o
Ethanol & Higher Alcohols to Hydrocarbons *
•
Hydrogen via Steam Reforming, WGS & Purification
•
Methanol via Catalytic Methanol Synthesis * Pathways explored by NREL through Aspen modeling and rigorous TEA.
Synthetic Natural Gas •
Methanation of Syngas
Synthetic Natural Gas Process
Sources
Min. Selling Price Range ($ / MScf)
Syngas to SNG via methanation
McKeough & Kurkela, 2007 Mozaffarian et al, 2004 van der Drift et al, 2005
nth Plant
16.52 – 19.13
Pioneer 10% IRR
28.50 – 31.05
Pioneer 25% IRR
50.00 – 56.93
35 30
f c 25 S M / 20 $ 1 15 1 0 10 2
Pioneer 10% IRR
29.80 ± 2.10
nth Plant
17.62 ± 2.23
Pricing History
5 0 2000
2002
2004
2006
2008
2010
2012
2014
Synthetic Natural Gas •
Techno-economic Analysis 40
f 35 c 30 S M25 / 20 $ 1 15 1 10 0 2 5 0
•
53.50 ± 5.70 ~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~
29.80 ± 2.10
17.62 ± 2.23
5.50 Market Price (5-Yr)
IRR = 10%
nth-Plant MSP
25%
Pioneer Plant MSP
Market Analysis Average Product per Ton Biomass U.S. Consumption (EIA, 2012)
11,440 Scf / Ton 25.5T Scf / Year
10% of U.S. Natural Gas Market Equivalent Biomass Consumption
2.55T Scf / Year 223 MMTon / Year
Equivalent Biorefineries
310
2,000 Tonne / Day Facilities
Ethanol •
Catalytic Mixed Alcohol Synthesis
•
Syngas Fermentation *
* Pathways explored by NREL through Aspen modeling and rigorous TEA.
Ethanol via Mixed Alcohol Synthesis Process
Sources
Min. Selling Price Range ($ / Gal GE)
Syngas to ethanol via catalytic mixed alcohol synthesis
Dutta et al, 2011 Dutta & Phillips, 2009 Dutta et al, 2010 He & Zhang, 2011 Villanueva Perales et al, 2011
nth Plant
2.87 – 4.83
Pioneer 10% IRR
5.67 – 9.64
Pioneer 25% IRR
11.27 – 19.20
12
E10 G n 8 o l l a G 6 / $ 4 1 1 0 2 2 0 2000
Pioneer 10% IRR
8.05 ± 2.08
nth Plant
4.16 ± 1.06
Pricing History
2002
2004
2006
2008
2010
2012
2014
Ethanol via Syngas Fermentation Process
Sources
Min. Selling Price Range ($ / Gal GE)
Ethanol via syngas fermentation
Putsche,1999 van Kasteren & Verbene, 2005 Piccolo & Bezzo, 2007
nth Plant
3.67 – 5.08
Pioneer 10% IRR
6.11 – 8.99
Pioneer 25% IRR
11.07 – 17.02
12
E 10 G n 8 o l l a G 6 / $ 4 1 1 0 2 2 0 2000
Pioneer 10% IRR
7.14 ± 1.82
nth Plant
4.32 ± 0.83
Pricing History
2002
2004
2006
2008
2010
2012
2014
Ethanol via Syngas Fermentation NREL TEA Model Flue Gas
Woody Biomass
Feed Handling & Preparation
Seed Train
Ethanol Biomass Gasification
Syngas Cleanup
Syngas Fermentation
Product Recovery
C3+ Alcohols
Heat Integration, Power Generation & Other Utilities
•
•
•
Acetic Acid
Power
Design Report NREL/TP-5100-51400 utilized as basis through clean compressed syngas from biomass. Yield structures based on publications from LanzaTech & INEOS Bio. Capital costs for fermenters, seed train and cell recovery developed by Harris Group Inc.
Ethanol •
Techno-economic Analysis
12
E G10 n o l l 8 a G6 / $ 4 1 1 2 0 2
15.76 ± 4.11 ~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~~~~~
12.59 ± 3.93 ~~~~~~~~~~~~~ ~~~~
8.05 ± 2.08
2.72
3.06
7.14 ± 1.82 4.32 ± 0.83
4.16 ± 1.06 IRR = 10 % 25%
IRR = 10 % 25%
IRR = 10 % 25%
0 Market Price (4-Yr)
Price Projection (4-Yr)
nth-Plant MSP
Pioneer Plant MSP
Mixed Alcohols (Literature) •
nth- Pl ant MS P
Pi one er Pl ant MS P
Syngas Fermentation (Literature)
nth-Pl ant MSP
Pi oneer Pl ant MSP
Syngas Fermentation (NREL TEA)
Market Analysis Average Product per Ton Biomass U.S. Consumption (EIA, 2013)
85 Gallons / Ton 13.0B Gallons / Year
50% of U.S. Fuel Ethanol Market Equivalent Biomass Consumption
6.5B Gallons / Year 76 MMTon / Year
Equivalent Biorefineries
100
2,000 Tonne / Day Facilities
Hydrocarbons Fischer-Tropsch
•
•
Methanol to Naphtha Hydrocarbons
•
Ethanol & Higher Alcohols to Hydrocarbons *
* Pathways explored by NREL through Aspen modeling and rigorous TEA.
Fischer-Tropsch Hydrocarbons Process
Sources
Min. Selling Price Range ($ / Gal GE)
Hydrocarbons via Fischer-Tropsch synthesis
Hamelinck et al, 2003 Larson et al, 2009 McKeough & Kurkela, 2007 SRI PEP Yearbook, 2009 Udengaard, 2011 Byrne, 2011 Freeman, 2011
nth Plant
2.52 – 4.19
Pioneer 10% IRR
4.75 – 7.43
Pioneer 25% IRR
9.08 – 13.52
8 7
E G6 n o l l 5 a G4 / $ 3 1 1 2 0 2 1 0 2000
Pioneer 10% IRR
5.63 ± 1.53
nth Plant
3.09 ± 0.96
Pricing History
2002
2004
2006
2008
2010
2012
2014
Methanol to Hydrocarbons Process
Sources
Min. Selling Price Range ($ / Gal GE)
Hydrocarbons via methanol synthesis and methanol conversion
Phillips et al, 2011 Hindman, 2010 SRI PEP Report 191A, 1999 Udengaard, 2011 Jones & Zhu, 2009 Ahn et al, 2009
nth Plant
2.61 – 3.84
Pioneer 10% IRR
4.67 – 6.47
Pioneer 25% IRR
8.61 – 11.38
8 7
E G6 n o l l 5 a G4 / $ 3 1 1 2 0 2 1 0 2000
Pioneer 10% IRR
5.37 ± 1.09
nth Plant
3.24 ± 0.81
Pricing History
2002
2004
2006
2008
2010
2012
2014
Ethanol & Higher Alcohols to Hydrocarbons NREL TEA Model Flue Gas
Woody Biomass
Feed Handling & Preparation
Co-Product(s) Biomass Gasification
Syngas Cleanup
Alcohol Synthesis
Alcohol Separation
Ethanol (and C3+ Alcohol) Intermediates
Heat Integration, Power Generation & Other Utilities
Light Ends Mixed C3 Hydrogen Plant
Mixed C4 Naphtha
Hydrocarbon Product Recovery
Alcohol to Hydrocarbon Conversion
Mid-Distillates Natural Gas •
Ethanol (and higher alcohol) intermediates for hydrocarbon fuel production.
•
Eliminates constraints of renewable ethanol blend limits.
•
Technology development taking place in academia, national labs and industry.
Hydrocarbon Fuels Techno-economic Analysis
•
8
E 7 G n 6 o l l 5 a G4 / 3 $ 1 2 1 1 0 2 0
10.66 ± 2.56 ~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~ ~~~~
9.54 ± 1.87 ~~~~~~~~~~~~~~ ~~~
5.63 ± 1.53 2.72
Market Price (4-Yr)
3.06
Price Projection (4-Yr)
3.24 ± 0.81
3.09 ± 0.96
nth-Plant MSP
Pioneer Plant MSP
Fischer-Tropsch (Literature) •
5.37 ± 1.09
nth- Pl ant MSP
Pi onee r Pl ant MSP
MeOH to Hydrocarbons (Literature)
nth- Pl ant MSP
Pi one er Pl ant MSP
EtOH to Hydrocarbons (NREL TEA)
Market Analysis Average Product per Ton Biomass U.S. Consumption (EIA, 2013) 10% of U.S. Hydrocarbon Fuels Market Equivalent Biomass Consumption Equivalent Biorefineries
65 Gallons / Ton 220B Gallons / Year 22B Gallons / Year 338 MMTon / Year
440
2,000 Tonne / Day Facilities
Hydrogen •
Steam reforming, water-gas shift & purification
Hydrogen Process
Sources
Min. Selling Price Range ($ / MScf)
Syngas to H2 via steam reforming, water-gas shift & purification
Spath et al, 2005 McKeough & Kurkela, 2003 Williams et al, 1995 Hamelinck & Faaij, 2001
nth Plant
5.33 – 8.84
Pioneer 10% IRR
10.46 – 15.63
Pioneer 25% IRR
20.93 – 29.07
18 16
f 14 c S M12 / 10 $ 1 8 1 0 6 2
Pioneer 10% IRR
Pricing History
4
nth Plant
2 0 2000
12.52 ± 3.62
2002
2004
2006
6.67 ± 2.48
2008
2010
2012
2014
Hydrogen •
Techno-economic Analysis 18 f 16 c 14 S M12 / 10 $ 8 1 6 1 0 4 2 2 0
•
24.23 ± 5.72 ~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~
12.52 ± 3.62
5.95
6.67 ± 2.48 IRR = 10%
Market Price (5-Yr)
nth-Plant MSP
25%
Pioneer Plant MSP
Market Analysis Average Product per Ton Biomass U.S. Consumption (EIA, 2013) 10% of U.S. Hydrogen Market Equivalent Biomass Consumption Equivalent Biorefineries
37,300 Scf / Ton 4.1T Scf / Year 0.41T Scf / Year 11 MMTon / Year
14
2,000 Tonne / Day Facilities
Methanol •
Catalytic Methanol Synthesis
Methanol Process
Sources
Min. Selling Price Range ($ / Gal)
Syngas to methanol via catalytic synthesis
Tarud & Phillips, 2011 McKeough & Kurkela, 2007 SRI PEP Yearbook, 2009 Williams et al, 1995 Hamelinck & Faaij, 2001
nth Plant
0.96 – 1.32
Pioneer 10% IRR
1.63 – 2.13
Pioneer 25% IRR
2.97 – 3.91
2.5
n2.0 o l l a1.5 G / $1.0 1 1 0 20.5 0.0 2000
Pioneer 10% IRR
1.93 ± 0.39 Contract Spot
Pricing History
nth Plant
2002
2004
2006
1.15 ± 0.26
2008
2010
2012
2014
Methanol as Chemical Intermediate •
Techno-economic Analysis 2.5
f 2.0 c S M 1.5 / $1.0 1 1 00.5 2 0.0
•
3.41 ± 0.64 ~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~
1.93 ± 0.39
1.16
1.15 ± 0.26
IRR = 10%
Market Price (5-Yr)
nth-Plant MSP
25%
Pioneer Plant MSP
Market Analysis Average Product per Ton Biomass U.S. Consumption (SRI / IHS, 2010)
170 Gallons / Ton 1.9B Gallons / Year
10% of U.S. Methanol Market Equivalent Biomass Consumption
0.19B Gallons / Year 1.1 MMTon / Year
Equivalent Biorefineries
1.4
2,000 Tonne / Day Facilities
Methanol as Fuel Intermediate •
Techno-economic Analysis 2.5
f 2.0 c S M 1.5 / $1.0 1 1 00.5 2 0.0
•
3.41 ± 0.64 ~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~ ~
1.93 ± 0.39
1.16
1.15 ± 0.26
IRR = 10%
Market Price (5-Yr)
nth-Plant MSP
25%
Pioneer Plant MSP
Market Analysis Average Product per Ton Biomass U.S. Consumption (EIA, 2013) 10% of U.S. Hydrocarbon Fuels Market Equivalent Biomass Consumption Equivalent Biorefineries
65 Gallons / Ton 220B Gallons / Year 22B Gallons / Year 338 MMTon / Year
440
2,000 Tonne / Day Facilities
Conclusions •
Hydrocarbon, ethanol and methanol economics can be competitive for nth-plant.
•
Pioneer plant economics are challenged overall.
•
Market capacities do not constrain bio-product pathways in major hydrocarbon fuel markets (natural gas, petroleum fuels).
•
With fixed ethanol blend limit, cellulosic pathways and grainderived product will compete for limited market.
•
Market capacities for methanol-derived chemicals are constraining.
•
Syngas fermentation is potentially competitive, depending on CO / H2 conversion to product(s).
•
Methanol and ethanol are attractive intermediates for production of infrastructure-compatible hydrocarbons.
Future Work •
Develop design reports for selected biomass-to-hydrocarbon fuel pathways under DOE-BETO directed efforts.
•
Apply simplified TEA and market analysis on emerging pathways to identify economic feasibility in early stages of development.
•
Explore opportunities to improve Pioneer Plant economics o
Biomass co-feeding opportunities (NG-Biomass to Liquids)
o
Utilizing inexpensive feedstocks
o
High-value co-products
o
RIN credits
Acknowledgements •
•
•
•
Abhijit Dutta and Richard Bain (co-authors) Matt Worley and Ben Fierman of Harris Group Inc, Atlanta, Georgia. Bioenergy Technology Office (BETO) of the United States Department of Energy NREL Biorefinery Analysis and Thermochemical Platform Teams
