E-Fuel Hybridization With Solar Can Improve Energy Production: IEA

A latest report by the International Energy Agency (IEA) on, “Role of E-Fuel in Decarbonizing Transport”, studied the role of hybridization of E-Fuel with wind and solar as a solution in reducing carbon dioxide (CO₂) emission. 

The report stated, “E-Fuel have emerged as an alternative in situations where, the usage wind and solar resources is found to be insufficient. The study finds that by co-locating carbon in these areas with bioenergy resources can in turn put an additional constraint on siting e-fuel projects that require carbon input.” The report evaluates, “This may require CO2 pipeline infrastructure. While techno-economically feasible, it may face important social acceptance challenges.”

The report added, “The need to decarbonise fossil fuel usage has led to a renewed interest towards the technology, this time powered by variable renewables. The majority of the projects that are currently in operation are small-scale demonstration projects, such as the ETOGAS pilot plant (Germany), using a 6 MWe electrolyze to produce methane.”

The report found the usage of ammonia and methanol production, as an exception as they can also be used in the chemical industry. It gives an example, “In China, the Ningxia Solar Hydrogen Project started operation in 2021. It is the world’s second largest electrolysis project in operation with 150 MWe capacity to produce methanol. The largest plant in operation today to produce ammonia, using only renewable electricity, is a 20 MWe project that Iberdrola started operating in Spain in 2022. However, in this case, hydrogen from electrolysis is blended with hydrogen from unabated natural gas before it enters ammonia production.”

Production Cycle In Ammonia Project

The IEA report mentioned, “The development of e-ammonia projects follows a similar logic as large fossil-based production today (proximity to best resources). But they are distributed in different geographical distribution. The biggest projects under development are located in areas which has a combination of solar PV and wind resources, such as desertic areas in the Middle East, Africa and Australia, with other large projects located in Chile and the United States. China has a significant number of smaller projects in much more advanced stages of development, thanks to a combination of good resources and proximity to large demand centers.”

The report added, “Renewable power especially, wind and solar PV electricity have created interest due to the major reductions in the cost of using variable renewables. It’s directly used to produce low emission e-fuels in locations that have high-quality renewable resources. and vast amount of available land for large-scale project development. At the best locations, capacity factors for producing electricity from renewables can exceed 50% for onshore wind and 25% for solar PV.

It evaluates factors affecting usage of low emission technology, ‘It mentions the importance of locations which complementary with wind and solar resources offer better opportunities for producing low-cost low-emission e-fuels than sites with only high-quality wind or solar resource. Thus, wind and solar resources can be considered complementary at a given location when they smooth each other’s variation in electricity generation.

Oversizing approach

Oversizing can increase the load factor of an e-fuels plant beyond the capacity factor of the electricity source as it allows electrolysers to run on high load even during times of lower generation from renewables. It involved the usage of combined installed capacity of wind and solar PV, that offers a dimensioned larger than the installed electrolysis capacity. Oversizing can increase the load factor of an e-fuels plant beyond the capacity factor of the electricity source as it allows electrolysers to run on high load even during times of lower generation from renewables. An economically optimal amount of oversizing is site specific and depends on the relative costs of plant components. At high electrolyser prices there is a strong economic incentive to increase the load factor of the e-fuel process, even if it results in curtailing part of the electricity during peak generation.

Hybridization As A Solution

Hybridization is a complementary optimisation approach to oversizing, used to find an economically optimal capacity mix of wind and solar PV generation for an e-fuels production plant. While hybridization does not contribute to higher capacity factor, it can be used to minimise curtailments for a given amount of oversizing. While oversizing depends on the relative costs of plant components, an economically optimal amount of hybridization is site specific. In the example illustrated above, the production cost is minimised at 40-50% share of solar PV in the capacity mix. At this level the annual curtailments are only 6% and significantly less than in a situation where power supply would be based solely on solar PV (18%) or wind (23%).