Industry news
Things I noticed and thought were interesting
Week ending 12th December 2021
1, Methanol as shipping fuel. Maersk said it was not certain that it would have green methanol available for the first delivery of its dual-fuel container ships in 2024. (Green methanol requires the carbon in the molecule not to be from fossil fuels). However it expressed confidence that it would have plenty of supply the following year for the eight new vessels. Some outlines of the design for the new ships were released, showing that the extra space needed for the methanol storage tanks will be provided by shifting the location of crew accommodation. This week a Netherlands consortium received government funding to trial large-scale methanol on ships. One ship owner said for a large scale transition to low carbon shipping, ‘the most viable option is methanol’.
2, Wind to H2. Last month Siemens Gamesa delivered hydrogen directly from an onshore wind turbine for fuel cell vehicles in Denmark. This was said to be the first example of H2 production from an ‘islanded’ wind turbine without an active connection to the electricity grid. Siemens’ longer term aim is produce large quantities offshore and it announced a partnership this week with Strohm, the leading manufacturer of flexible plastic pipes suitable for use transporting hydrogen from the turbine to onshore distribution grids.
3, Heat for industrial processes. Hydrogen may be able to replace natural gas in many industrial processes that require very high temperatures. Hydrogen combusts at around 2,000 degrees in air, about the same as natural gas. Several industries are beginning the early stages of experimentation to trial the use of H2 for high temperature industrial heat. Australian mining company Infinity Minerals intends to work with ThyssenKrupp on experiments to manufacture lithium. It is using a technology that should enable 100% substitution by hydrogen. Although lithium manufacture for batteries is not a major use of natural gas at the moment, increased needs for electricity storage are likely to cause sharp rises in the amount of lithium processed. My estimate of the lithium needed for batteries suggest that a stock of 4.5 million tonnes will be needed for private cars alone by 2050 (assuming 100% recycling) but 2020 lithium global production was only around 80,000 tonnes.
4, Solid state batteries. The arrival of inexpensive solid state batteries will be an important moment for the automobile industry. Eventually, the energy density (kWh/kg and kWh/l) may be up to twice as good as today's lithium ion products. (Two reports this week have been critical of electric cars because the increased weight may cause more damage to roads). GM indicated it will build a new factory with the Korean chemicals firm Posco to make cathode materials for a range of standardised batteries. Cathodes currently comprise about 40% of the cost of a battery cell. VW also signed a deal with partners to enable the expansion of its battery capacity to cover the requirements for the batteries of 2.2m cars by 2030. VW makes about 9.5m cars a year at the moment and expects 60% electrification by this date. In both cases, the joint ventures appear to be aimed at speeding up the delivery of a standardised solid state lithium-based battery usable across most of the range of the two manufacturers. The drive of the main car makers into the battery manufacturing business may undermine the specialists such as CATL.
5, Small scale hydrogen production. Most weeks now see announcements of hydrogen projects of 1 GW or more. Wood Mackenzie said that its database records at least 180 GW of plans around the world, up seven fold in the last year. What is happening at the other end of the scale? Does it make sense for individual buildings to make hydrogen from surplus solar electricity to then use in months of weak sun? Many have doubted this. But as retail electricity prices rise steeply, particularly across Europe, the financial logic may change. Enapter, the innovative Italian/German electrolyser producer has consistently claimed its small units can be used make a home self-sufficient in energy by storing hydrogen. Home Power Solutions, another German company, announced that its existing small hydrogen solution could now be seamlessly linked to up to nine other units, storing up to 15 MWh of electricity in the form of hydrogen for larger buildings. Small electrolysers are still remarkably expensive, probably at least five times the price of the huge units now being planned around the world. And conventional electrolysers are expected to fall in cost by another 35-50% by 2025. Nevertheless high home electricity prices will provide a boost to the appeal of micro-electrolysers combined with hydrogen storage. (Thanks to Nick Hanna)
6, Lower carbon cement. Global producer Cemex linked with Carbon8, a UK innovator, to investigate the use of a new technology to store captured CO2 from the cement production process. Carbon8 takes carbon dioxide directly from process gases and combines it with the dust from the production of cement to manufacture a lightweight aggregate which can then be used in construction, permanently storing the carbon. This is the second deal with a cement industry participant this year after the pilot installation of one of the company’s modular containers at a French cement works last year.
7, Oil and gas investment. According to the International Energy Forum, an oil industry body, lending to fossil fuel companies will be less than the value of the debt raised by green projects in 2021. This will be the first time that green lending ($466bn) has exceeded that to conventional energy ($460bn). Only three years ago, lending to fossil fuels exceeded $750bn. The capital shortage for the oil companies will result in a sharp decline in projected output. ‘Remarkably’ the Forum says, ‘there are currently no new greenfield megaprojects planned in the next five years’ in the global oil industry. As might be expected, the industry body says that the lack of new money flowing into oil will cause acute supply shortages as oilfields run down. It ‘calls for oil and gas to account for 55% of the primary energy demand in 2030, slightly above 2020 levels’ and for investment in new fields to rise by over 50% from current levels. Parts of the fossil fuel industry still don’t seem to recognise the strength of the argument that decarbonisation is an urgent necessity.
8, Timber buildings. The World Economic Forum (WEF) suggested that cross laminated or ‘mass’ timber ‘is likely to take off at scale over the next decade’. The key advantages over concrete and steel include, of course, a potentially negative carbon footprint but also a much simpler supply chain, if construction takes place close to sources of timber. Although still relatively uncommon, mass timber is now used in a wide variety of buildings, large and small. One UK architect commented that its use had cut construction time and costs by 15% on a small block of apartments. In Los Angeles, a mixed use building nearly 25 metres high and offering 11,000 square metres in floor space will be completed next year. The journalist commenting on this elegant building noted that the US construction industry produces 600 million tonnes of waste material a year, more than twice the weight of all municipal wastes. Widespread use of mass timber would reduce the amount of unrecyclable material.
Work demands mean that I will not be able to complete this newsletter over the next few weeks. Many apologies and thank you very much for all the comments over the last few months.
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