2021 AFPM Summit Virtual Edition: Evaluating renewable plant integration in fossil fuel facilities
SUMEDHA SHARMA, Technical Editor, Hydrocarbon Processing
The AFPM Summit’s Profitability Session on Tuesday morning presented an interesting delve into “Optionality in Refining and Petrochemicals to Meet Renewables and Energy Transition Targets.” The session’s main facilitator was Jerry Sexton, Marathon Petroleum Corporation, and discussion speakers included: Robert Ohmes, Division Manager, Strategic Business Planning, Becht; Jerry Price, Director, Emerging Energy Advisory, 1898 & Co.; and Soheil Razjouyan, VP, Americas Advisian.
The discussion provided an in-depth overview of Scope 3 emissions and reduction options. Scope 3 emissions are classified as those that result from assets not directly owned or executed by an organization but include emissions both upstream and downstream of the organization. The GHG protocol is an excellent resource to identify and quantify Scope 3 categories and provide guidance on data requirements, quantification methods and emissions reduction target setting. It is important to identify and address such emissions concentrations in the organizational supply chain to assess associated risks, determine energy efficacy and evaluate cost reduction options.
Evaluation of renewable plant integration in fossil fuel facilities. Price provided a multi-point analysis on renewables integration in fossil fuel facilities, speaking about the driving factors, associated incentives and hardware considerations for refinery conversions. The interest in renewable energy is driven by rising consumer and stakeholders demand for production of renewable fuels, financial incentives encouraging investment, and the opportunity for fuel producers to hedge the rising cost of compliance. These market factors have resulted in a substantial number of greenfield and brownfield investment executions in the U.S. and on a global scale.
The D4 and D5 RIN standards are primary incentives to target renewable fuels along with the implementation of the Low Carbon Fuel Standard (LCFS) in some states with several others following suit. The tax credit of $1/gal applicable to producers of bio-based fuels—which is likely to be extended beyond 2025—is another attractive incentive for renewables production. Price presented a comparison of the standard product revenues and renewable diesel incentives, indicating how effectively the incentives are driving positive earnings before interest, depreciation and amortization (EBIDA) and low carbon intensity feedstocks, further substantiating the amount of money that can be generated from a renewable fuel facility.
Price further elaborated on equipment and hardware requirements for converting an asset into a renewable facility, outlining considerations for catalyst volume and space velocity requirements, operating pressure and metallurgical upgrades. Facilities that have a higher tolerance for sour crude processing and those equipped with hydrogen generation units are ideal candidates for conversion. He summarized by stating that although financial incentives are the key drivers for growth, conversions are unique and depend on individual asset portfolios and the hardware cost for reconfiguration is an important deciding factor in renewable integration.
Net zero and energy transition. Ohmes presented a comprehensive perspective on net zero and how it will impact the energy transition. His presentation pivoted on the benefits, challenges and economics of green hydrogen technologies and the overall pace of energy transition (FIG. 1).
FIG. 1. Green hydrogen technologies and the overall pace of energy transition.
He emphasized how hydrogen will be a key part of the solutions and ventures needed to reach the greenhouse gas emissions reduction goals. Presently, blue hydrogen emerges as the technical and economically feasible pathway for energy transition while the other hydrogen technologies need to prove economic and operational viability to be associated with Net Zero initiatives. A modern plant must be capable of either low-emissions hydrogen production or consumption to become a plant of the future.
The AFPM Summit continues through Wednesday. To access news and editorial from the AFPM Summit, visit the Conference News tab on the homepage of www.HydrocarbonProcessing.com.