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8 Rivers developing low-carbon ammonia project in Texas

A spot in the US Gulf Coast will host the North Carolina firm’s “ultra-low carbon” ammonia production facility.

8 Rivers Capital is developing the Cormorant Clean Energy Project, a low carbon ammonia production facility in Port Arthur, Texas, according to a news release.

The Cormorant project will be powered by 8 Rivers’ proprietary 8RH2 hydrogen process, representing the first commercial deployment of the technology, the release states.

ReSource reported last year that 8 Rivers would be seeking to raise capital for its first production facility.

Cormorant will produce an estimated 880,000 tons of ammonia and capture more than 1.4MM tons of CO2 annually, with a >99% CO2 capture rate. The site is expected to bring in over $1bn in investment to the region.

The 8RH2 process is an ultra-low-carbon hydrogen process that harnesses oxy-combustion to eliminate CO2 emissions and lower costs. Ultimately, the firm aims to serve hard-to-abate industries like shipping, heavy transportation, aviation, and power generation.

“At Cormorant, hydrogen produced by 8RH2 will be turned into ultra-low-carbon ammonia that can be used for transportation, industrial processes, agriculture, and more, all with best-in-class efficiency and carbon capture,” the release states.

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PCC Hydrogen to build ethanol-to-hydrogen pilot

The Indiana plant will convert ethanol into high purity, negative carbon index green hydrogen using a patented reforming process coupled with carbon capture.

PCC Hydrogen Inc, a low carbon/negative carbon hydrogen production company based in Louisville, KY, is pleased to announce plans to construct a pilot hydrogen production plant in Cloverdale, IN, according to a news release.

PCC H2’s plant will showcase the efficient conversion of logistically friendly ethanol into high purity, negative carbon index green hydrogen using a patented reforming process coupled with the capture of the processes pure CO2 byproduct. By providing a readily available, negative carbon index hydrogen close to the point of need, the Company is enabling the decarbonization of the economy in a cost effective and commercially viable way.

The Company has engaged Plant Process Group (PPG), a leading Houston based design, engineering, fabrication, construction, and commissioning services company to support the project with plans to have the pilot plant operational by first quarter 2024. PPG has decades of experience designing and building facilities for the refining industry, chemicals manufacturers, and biofuels producers.

PCC H2 is also working closely with the Town of Cloverdale and Putnam County to support the establishment of the first negative carbon index hydrogen production facility of its kind in the world. The production facility expects to hire local personnel at competitive wages and benefits.

Tim Fogarty, PCC H2 CEO, stated “We are excited to work with the Town of Cloverdale and Putnam County to showcase our groundbreaking technology. The Cloverdale location is ideal for the construction and operation of our first production facility given existing local hydrogen demand and the potential for broad adoption of low cost, negative carbon index hydrogen to help decarbonize the local economy in a financially rational way.”

Hydrogen generated from the PCC H2 process can be used in myriad applications ranging from hydrogen combustion engines to fuel cells (fuel cell powered loaders, trucks, other rolling stock, and for fuel cells in non-grid connected BEV charging stations). Furthermore, PCC H2 is exploring the use of its hydrogen to lower the emissions profile of any heating/calcining process. Finally, the Company is leveraging the logistically friendly nature of ethanol to produce hydrogen at smaller, distributed facilities closer to the point of use, diminishing the adverse added expense of transporting liquid hydrogen over long distances.

Cloverdale Town Manager, Jason Hartman, added “Cloverdale is extremely pleased to support the construction of the first of its kind negative carbon index hydrogen production plant that will decarbonize local industry while offering competitively priced jobs to the local community.”

The PCC H2 core reformer at the pilot plant will be mounted on three skids and operate 24/7. The company expects to break ground at the site this Summer.

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Hydrogen Council, McKinsey 2023 hydrogen report summarized

The hydrogen industry faces challenges due to high costs and regulatory uncertainty despite significant advances this year, according to the report.

The global hydrogen economy is witnessing significant growth, with more than 1400 projects announced, marking an increase from about 1040 last year, according to the 2023 Hydrogen Insights report from The Hydrogen Council and McKinsey. 

These projects, amounting to a total investment of  $570bn, aim to supply 45 million tons per annum of clean hydrogen by 2030. Europe leads in project numbers (540), followed by North America (248), with a quarter of these projects already past the final investment decision (FID) stage. 

Notably, investments are maturing, with $110bn allocated for front-end engineering and design (FEED) and beyond, a 60% growth in such investments. Electrolysis deployment has also surged, surpassing 1 GW, with approximately 12 GW capacity having passed FID​​.

However, the clean hydrogen industry faces challenges, particularly in the cost of producing renewable hydrogen. The estimated levelized cost of producing renewable hydrogen (LCOH) is currently about $4.5 to $6.5 per kilogram, an increase of 30% to 65% due to factors like higher labor and material costs. Despite this, costs are expected to decline to $2.5 to $4.0 per kg by 2030, driven by advancements in electrolyzer technology, manufacturing economies of scale, and reductions in renewable power cost​​.

The regulatory landscape is evolving but uncertainties persist, the report notes, including the requirements for receiving production tax credits under the US Inflation Reduction Act and the implementation of the Renewable Energy Directive in EU member states​​.

Investment growth is evident across most regions. Europe not only has the most projects but also the highest total investments announced ($193bn). Latin America, despite fewer projects than North America, has announced the second-largest volume of investments ($85bn), attributed to larger project sizes and a higher share of giga-scale renewable hydrogen projects. North America’s announcements grew by about 20%, reflecting continued momentum following policy developments. India, the Middle East, and China also showed significant growth in investments​​.

In terms of electrolysis capacity, over 305 GW has been announced through 2030, with China leading in capacity past FID, accounting for about 55% of the 12 GW total. The European investment pipeline has 40 GW (about 45%) at least in the planning stage, and Latin America contributes 20% of all announced volumes through 2030. However, less than 5% of renewable hydrogen supply investments are currently committed, indicating a need for significant acceleration in project development and scaling up of supply chains and manufacturing capacity​​.

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Plastics recycling tech provider strikes insurance partnership

New Energy Risk will provide technology performance insurance to plant owners and operators who license Green Circle’s advanced waste plastic recycling technology.

New Energy Risk, a wholly owned division of Paragon Insurance Group, and Green Circle, a wholly-owned division of Lummus Technology, have forged a strategic partnership in which NER will serve as the preferred insurance supplier for Green Circle’s advanced waste plastic recycling technology.

Upon completing a thorough due diligence process, NER is prepared to provide technology performance insurance solutions to plant owners and operators who license Green Circle’s advanced waste plastic recycling technology. Since 2013, NER’s performance insurance has enabled the financing of over $3bn for development of new and renewable clean energy technologies and other circular economy projects.

“NER provides an extremely valuable service to project owners looking to deploy early-stage technologies at scale through project finance,” said Greg Shumake, managing director of Green Circle. “They thoroughly evaluated our advanced waste plastic pyrolysis technology and are confident in its commercial viability. And as a result, it will be easier for our clients to develop bankable projects to drive a more circular economy.”

The waste plastic pyrolysis technology uses a thermochemical process for turning end-of-life plastics into a high-quality product that can be used to reduce the carbon intensity in the production of both transportation fuels and circular plastics. Green Circle is working across the sector, from Fortune 500 companies to independent project developers, to deploy technologies that close the loop of the plastic product lifecycle.

“Green Circle’s advanced waste plastic pyrolysis technology has been developed with a level of expertise and discipline that is rare,” said Brad Price, managing director of Technical Due Diligence at New Energy Risk. “We are proud to help accelerate the adoption of this technology by providing assurance to owners and investors that this technology will perform.”

Green Circle concentrates and expands Lummus Technology’s capabilities to capture new opportunities in the energy transition and circular economy. Green Circle is a leader in providing economically and technically sound solutions to: process solid wastes containing plastics; process various renewable bio-based feedstocks to value-added chemicals, polymers and fuels; decarbonize refinery and petrochemicals assets; and expand production of blue hydrogen and biofuels.

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Aemetis capitalized for hydrogen and biofuel development plans

Aemetis CEO Eric McAfee said in an interview that the company has lined up financing to complete the $1.2bn in biogas and sustainable aviation fuel projects it has in development.

Aemetis is well capitalized to complete the $1.2bn in biogas and sustainable aviation fuel (SAF) projects it has in development, CEO Eric McAfee said in an interview.

Founded by McAfee in 2006 and listed on the NASDAQ in 2014, Aemetis plans to produce more than 60 million gallons per year of SAF and capture and sequester 125,000 mtpy of carbon in 2025. This is a diversification from existing ethanol, RNG and biodiesel operations in the US and India.

The company recently released an updated five-year plan including plans to generate $2bn of revenues, $496m of net income, and $682m of adjusted EBITDA by 2027.

McAfee, noting that Aemetis is well capitalized and has locked in financing for much of its plans, said, “The only thing we really need to do is just execute.”

For example, the company closed $25m of USDA loan guarantees in October at a 6.2% interest rate, McAfee said. The company has also signed a $125m USDA commitment letter for its Riverbank Biofuels Project in California, also called CarbonZero 1, which will produce SAF.

“We’ll be expanding that relationship with [the USDA],” McAfee said. “Everything else is financed.”

The Riverbank Biofuels Project has signed offtake agreements with major airlines, and the SAF segment is expected to be the biggest contributor to Aemetis’ revenues once the project is online in 2025, according to a presentation. Renewable diesel and SAF will add $348m of revenues in 2025 and $693.3m of revenues in 2026.

For its carbon sequestration projects, referring to upgrades at the existing Keyes ethanol plant in California and other operational assets, the company has an existing $100m line of credit provided by Third Eye Capital, $50m of which remains unused, McAfee said.

Projected revenues will allow the company to self-fund without new credit facilities, McAfee said. Revenues from Aemetis’ debt-free operations in India will also be available to fund new developments.

The Riverbank SAF plant will be fully engineered and permitted this year, McAfee said. Baker Hughes and ATSI are the company’s EPC partners on the new developments.

Aemetis has no plans to divest existing operational assets but could acquire California biogas assets, McAfee said. The company regularly talks to investment bankers.

McAfee is the largest single shareholder in Aemetis. JackBlock, the former US Secretary of Agriculture, sits on the company’s board. The largest institutional shareholder is BlackRock.

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Exclusive: Plug Power enlists bank to evaluate financing options

The cash-burning company is working with a bulge-bracket American bank to evaluate debt financing options to help stave off a liquidity crisis.

Plug Power is working with Goldman Sachs to evaluate a capital raise in the form of debt financing to shore up its balance sheet, sources said.

The New York-based company recently said it was at risk of a liquidity crisis in the next 12 months if it is not able to raise additional capital, noting it was exploring various options for bringing in financing.

Its total cash and cash equivalents as of September 30 stood at $567m, representing a decline of $580m for the quarter, according to SEC filings. The company also has nearly $1bn of restricted cash balances stemming from sale-leaseback transactions, of which $50m becomes available per quarter.

In a shareholder letter and on its 3Q23 earnings call, executives outlined the financing options that are on the table for the company, including a debt raise, funding from the Department of Energy’s Loan Programs Office, and bringing in project equity partners for its facilities.

The company is “evaluating varied debt financing solutions to support [its] growth,” according to the shareholder letter. CFO Paul Middleton added on the call that they’ve had “some expressions of offers for ABL-like facilities” as well as restricted cash advance facilities. 

CEO Andy Marsh said the company would need to raise between $500m – $600m, according to a news report from Barron’s.

Representatives of Plug Power and Goldman Sachs declined to comment.

Plug is also working towards a conditional commitment from the DOE Loan Program Office to finance plants in its green hydrogen network. 

“The framework that we’re working on with them is a $1.5bn platform that would fund our green plants and would fund from construction phase onwards,” CFO Middleton said, adding that the funding could amount to as much as 80% of the projects. 

Middleton said he expected the DOE loan, if granted, would start funding in early 2Q24, and could even be used to back lever some of its existing plants in Texas and New York.

The company’s stock traded today with a $2.34bn market cap, while its outstanding debt consists of a $200m convertible note issued in 2020.

The notes traded around 130 cents of par before Plug’s going concern announcement, and subsequently dropped to trade in the high-70s, with quotes this week in the 80s.

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Siemens Energy planning new US electrolyzer capacity

The company is targeting expansion in the U.S. given the favorable policy environment following passage of the Inflation Reduction Act (IRA).

Siemens Energy North America is laying the groundwork for new electrolyzer manufacturing capacity in the United States, President Richard Voorberg said during a panel discussion recently.

Siemens Energy, a global energy technology company, makes an 18 MW PEM electrolyzer, one of the largest in the world, and is targeting expansion in the U.S. given the favorable policy environment following passage of the Inflation Reduction Act (IRA), Voorberg said.

The company is building its first gigawatt factory in Berlin, Germany via a joint venture with France’s Air Liquide. The Berlin factory is expected to produce 1 GW of PEM electrolyzers per year starting in mid-2023.

“As soon as we get that first one up and running… I’ve got a plan already to put a 1,000 MW line in the US,” Voorberg said, speaking during an event at the Delegation of German Industry and Commerce in Washington D.C. last month.

Siemens’ existing manufacturing capacity in the US could expand to accommodate that new line, or the company could look to build an entirely new facility, Voorberg said. He added that the recently passed IRA helps makes the business case to do so.

Following the IRA, customers went from asking for fractions of a megawatt to seeking 2 GW in a single order, Voorberg said. His 18 MW line is now insufficient.

“We’ve got to scale up,” he said. “Scale is everything.”

Voorberg said his company sees hydrogen being used in electricity production around 2035, but mobility can use it now.

The planned move by Siemens underscores the extent to which the IRA legislation has trained the hydrogen industry’s focus on the U.S. Norway-based electrolyzer producer Nel is speeding efforts to expand electrolyzer capacity in the U.S. And Cummins announced last month that it would add electrolyzer production space at its existing facility in Fridley, Minnesota.

Siemens Energy is independent of Siemens AG, having spun off in 2020. The company has about 10,000 employees in the US and roughly 2,000 in Canada.

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