However, despite these process advantages, little research is being done with electrofuels because of their high production costs.
But the catalytic hydrogenation of CO₂ using Fischer–Tropsch synthesis (FTS) has emerged as a promising method for electrofuel production, driven by advancements in carbon capture technology and the declining cost of renewable electricity. Also, the maritime sector’s impending inclusion in the European Union’s emission trading system (ETS) strengthens the position of electrofuels as a potential alternative in the shipping fuel market.
To further explore the techno-economic viability of FTS to produce cost-competitive electrofuels, Fasil Ayelegn Tassew, a senior researcher at DNV, an assurance and risk management provider in Høvik, Norway, decided to undertake a cost evaluation for a theoretical plant dedicated to electrofuel production, using green hydrogen and CO₂ from DAC. The production capacity was set at 1,000 barrels of crude electrofuel per day.
“We also explored the decarbonization potential and analyzed how the maritime sector’s integration into the EU’s ETS could affect electrofuel cost-effectiveness,” Tassew said.
Plenty of potential
Various electrofuels such as e-hydrogen, e-ammonia, e-methane, e-methanol, and e-diesel are promising fuel alternatives for the maritime industry. Despite their potential, electrofuels usage in the maritime sector remains limited, due to short-distance routes, small vessels, and the high costs of storage, infrastructure, and fuel cells.
FTS can produce synthetic liquid fuels from diverse feedstocks such as natural gas, coal, and biomass, utilizing catalytic processes. For electrofuels, the main inputs are hydrogen in the form of H₂ and a carbon source in the form of CO, at an H₂/CO ratio of about two.
“A literature review of electrofuels revealed a significant cost disparity between electrofuels and fossil fuels, with electrofuels bearing a significantly higher price tag,” Tassew said. “The primary obstacle to the short-term adoption of electrofuels is their expensive production, primarily driven by the need for renewable electricity to power water electrolysis for hydrogen production—making them several times more costly than their fossil-fuel counterparts.”
Research considerations
Tassew’s team applied the levelized cost of fuels (LCOF) method to estimate electrofuels’ cost. LCOF is the ratio of the cost of fuel generation to the amount of fuel generated over a specified time.
“LCOF indicates the minimum price of the electrofuel to cover all costs incurred during production, operation, and maintenance of the electrofuel plant, as well as transport and delivery of the fuel,” Tassew said.
The theoretical electrofuel plant takes CO₂ and H₂ as feedstocks to generate electrofuels in a two-step process: conversion of CO₂ and H₂ into syngas using the Reverse Water-Gas Shift (RWGS) reaction, followed by conversion of the syngas into electrofuels using FTS. “The CO₂ is captured directly from air, whereas the hydrogen is produced through water electrolysis using a renewable energy source,” Tassew said.
Meanwhile, the plant itself is composed of three units: DAC, hydrogen production, and synthesis and refinery units. The DAC unit is modeled after Carbon Engineering’s calcium looping technology, where atmospheric air passes through a KOH solution that selectively reacts and captures CO₂, followed by a series of reactions to recover the looping chemicals.
To determine the amounts of CO₂ and H₂ required for daily production requirements, the researchers assessed the weight fractions of the primary components in FTS products, considering factors such as reaction conditions, H₂/CO ratio, and catalyst type.
“The weight fraction of each molecule within these components was then calculated,” Tassew said. “Following this, the weight of each molecule was determined by multiplying its weight fraction by the component’s weight fraction and the total daily electrofuel production."
To determine the potential greenhouse gas emission reductions achievable by the electrofuel plant, the team first identified the primary emissions sources within the plant’s inventory and quantified those emissions. Electrofuel production relies on energy-intensive DAC and hydrogen production units, which contribute significantly to the overall energy consumption.
“We also considered emissions stemming from the use of chemicals and catalysts, as well as emissions associated with the transportation and final utilization of electrofuels,” Tassew said.
When it comes to the plant’s capital expenditure (CAPEX), which represents the expenses needed to make the plant operational, it’s calculated as the sum of the capital expenditures of the DAC, hydrogen production, and synthesis and refinery units.
Results and discussion
After running the simulations, the research team discovered that a plant with a 1,000-barrel per day capacity requires 60 metric tons of H₂ and 424 metric tons of CO₂ daily, achieving a 36 percent hydrogen-to-electrofuel conversion rate.
Initial CAPEX is projected at $295 million, with an additional $139 million for electrolyzer replacement. The hydrogen production unit accounts for 61 percent of the CAPEX, followed by the DAC unit at 22 percent.
Meanwhile, the annual operating expense (OPEX) is estimated at $49.3 million, with hydrogen production and DAC constituting 58 percent and 25 percent of this expense, respectively, due mostly to electricity costs. The synthesis and refining units comprise 17 percent of the OPEX.
The levelized cost of electrofuel is calculated at $1,881 per metric ton, which is 2.5 times the cost of marine gas oil and 3.8 times that of very low sulfur fuel oil (VLSFO). However, the electrofuel’s emission factor is significantly lower, at nearly 14 times less carbon-intensive than traditional fuels.
Next steps
“Our study shows that electrofuels’ cost-competitiveness with fossil fuels depends on favorable conditions such as low electricity costs, low discount rates, and high carbon prices,” Tassew said. “While the EU’s emission trading system inclusion for maritime transport will lessen the cost disparity, it is unlikely to make electrofuels cost-competitive, given current carbon prices.”
Electrofuels do, however, have several advantages over VLSFO. In addition to having significantly lower greenhouse gas emissions, electrofuels don’t emit sulfur or nitrogen oxides and emit 95 percent less CO₂ than VLSFO. In addition, they can be used as a drop-in fuel in current engines and do not require significant changes in the transport and logistics infrastructure. Due to the production method, electrofuels can be produced almost anywhere, as long as there is an accessible source of abundant renewable electricity, which would facilitate energy independence.
Electrofuel plants will require substantial capital and operational investment to start up, maintain, and operate. To make electrofuels competitive in the short-to-medium term, “a significant legislative effort in the form of government subsidies and actions that will lead to strong increase in carbon prices may have to be implemented, coupled with incentivizing cargo owners, charterers, and end-users to push for sustainable shipping,” Tassew concluded.
Mark Crawford is a technology writer in Corrales, N.M.
