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Hy Stor teams with Schneider Electric for automation and electrical mgmt

Schneider Electric will provide Hy Stor Energy with a suite of electrical and automation services to support the development of Hy Stor's Mississippi Clean Hydrogen Hub and its broader U.S. development platform.

Schneider Electric, a provider of energy management and automation solutions, and Hy Stor Energy, a green hydrogen and long-duration storage developer, have signed a memorandum of understanding to support the development of Hy Stor Energy’s Mississippi Clean Hydrogen Hub and its broader U.S. development platform.

In this partnership, Schneider Electric and Hy Stor Energy are solving large-scale energy and sustainability challenges that are required to transition to a renewable and fossil-free energy system, according to a news release.

Under the terms of the MOU, Schneider Electric will provide Hy Stor Energy with automation and safety solutions, AVEVA process operation and AI optimization software, weather analysis, predictive operations, and digital energy management solutions, as well as commissioning, operational analytical tools, and support for those offers.

This project will advance Hy Stor Energy’s vision for the MCHH to be the first-of-its-kind in the world, providing reliable zero-carbon hydrogen to customers across a variety of industries. This new collaboration will offer Hy Stor Energy’s customers secure, reliable, and affordable green hydrogen with no carbon footprint or methane emissions.

Hy Stor Energy and Schneider Electric share common values in advancing sustainability in the new energy landscape by exploring intuitive solutions to address today’s energy challenges. In this agreement, Schneider Electric will be the main automation and electrical contractor, and partner for digital energy management and automation solutions for Hy Stor Energy’s operations. This solution is designed to deliver 100% carbon-free energy, providing customers with safe and reliable renewable energy on-demand.

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Brookfield Renewable-backed LanzaTech gets UK grant for waste gas-to-SAF facility

Illinois-based LanzaTech has received a £25m UK grant for a plant that will convert waste gases into synthetic kerosene for use in sustainable aviation fuel.

LanzaTech has announced that its DRAGON facility project has received a £25m grant from the UK Department for Transport’s Advanced Fuels Fund Competition, according to a news release.

LanzaTech’s Project DRAGON, which stands for Decarbonizing and Reimagining Aviation for the Goal Of Netzero, will convert waste gases into synthetic kerosene for use in sustainable aviation fuel (SAF).

With the funding, Project DRAGON will complete engineering and the project development in collaboration with Fluor Corporation and Technip Energies, required to reach a final investment decision (FID) for the entire waste gas to SAF project. The proposed plant, which will be sited in Port Talbot, South Wales, is expected to produce 102 million liters per year of ATJ Synthetic Paraffinic Kerosene (ATJ-SPK) to be blended with kerosene to make SAF, representing ~1% of annual UK jet fuel demand and making a significant contribution towards the UK Mandate for supplying 10% of total annual jet fuel demand in the U.K. with SAF by 2030.

LanzaTech recently reached a funding partnership with Brookfield Renewable, under which Brookfield committed to invest an initial $500m in constructing and operating new carbon capture and transformation projects that have achieved certain pre-agreed milestones. Brookfield will be LanzaTech’s preferred capital partner for LanzaTech CCT opportunities in Europe and North America and following initial investments totaling $500m, Brookfield could commit to making an additional $500m available for investments in the strategic partnership if sufficient projects are available at the agreed milestones. Brookfield will also invest $50 million in LanzaTech to support further corporate development.

The company went public earlier this year in a SPAC acquisition that valued LanzaTech at an implied $1.8bn pro forma enterprise value.

“We must accelerate deployment of SAF plants in the UK,” said Jennifer Holmgren, CEO of LanzaTech, in this week’s news release. “We’re excited that Project DRAGON has been recognized for its potential to deliver results and create new jobs while producing the volumes of SAF greatly needed by a sector that has limited options today. I thank the UK Department for Transport for its continued support and for showing leadership in validating new technologies that can have a real impact in the UK and beyond.”

Jonathon Counsell, International Airline Group’s head of sustainability, said: “Investing in Sustainable aviation fuels (SAF) is one of the best opportunities our industry has to decarbonise. We’re delighted that Project Dragon has received crucial financial support in the UK from the Department for Transport Advanced Fuels Fund.”

“IAG has committed $865m in SAF purchases and investments to date, including supporting the first of its kind LanzaJet ethanol-to-jet plant being built in the US. With the right policy support to incentivise further investment, the UK could see many SAF plants built over the next decade, creating 6,500 jobs and saving over three million tonnes of CO2 per year as well as improving the UK’s energy security.”

The feedstock for the planned facility would be waste gases, including potentially from Tata Steel’s adjacent steelworks in Port Talbot. These would be transformed via LanzaTech’s gas fermentation platform to make ethanol as a feedstock for the ATJ facility. LanzaTech have selected Fluor Corporation, a leading global engineering, procurement, and construction (EPC) firm, to provide Front End Engineering and Design (FEED) services for this part of the project. “With more than 110 years in the industry, Fluor brings world class front-end engineering and EPC firm experience to assist LanzaTech in deploying its technology,” said Jason Kraynek, president, Production & Fuels, Fluor Corporation.

In a second step the ethanol would be turned into SAF using the LanzaJet™ Alcohol-to-Jet (ATJ) process, which incorporates Technip Energies ‘ethanol to ethylene’ Hummingbird™ technology. This would be the world’s first commercial scale integration of Gas Fermentation (GF) and ATJ to produce SAF with GHG reductions expected to be greater than 70% relative to conventional jet fuel.

A spokesperson for Tata Steel in the UK said: “Achieving our ambition of making CO2 neutral steel involves looking at all ways to reduce our emissions, or in this case, potentially transforming some of our waste gases into useful products such as jet fuel.”

Bhaskar Patel, Technip Energies – SVP Sustainable Fuels, Chemicals and Circularity stated “We are excited to be partnering with LanzaTech™ through our teams in the UK on this journey to help decarbonize the UK aviation industry. The implementation of T.EN’s Hummingbird™ technology integrated within the LanzaJet™ ATJ process provides a ‘best in class’ technology pathway for conversion of ethanol to SAF”.

Jimmy Samartzis, CEO, LanzaJet said: “Project DRAGON will contribute roughly 10% of the entire UK Mandate for SAF by 2030. That’s significant, and government leadership like this is paving the way for emerging industries like SAF to achieve these ambitious and necessary goals. LanzaJet’s alcohol-to-jet technology paired with LanzaTech’s gas fermentation process is changing how we think about the circular economy across the world and driving decarbonization for aviation. We’re thrilled to be partnering with LanzaTech on this work and we’re grateful for this support from the UK Department for Transport.”

The Department for Transport’s Advanced Fuels Fund (AFF) Competition was established to support the UK advanced fuels sector in development and commercial deployment of innovative fuel production technologies that are capable of significantly reducing near-term UK aviation emissions, strengthening the UK project pipeline, and broadening technology options.

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SAF developer eschews high-cost debt and equity to pursue DOE loan guarantee

A Colorado-based developer of sustainable aviation fuel projects will forgo high-cost equity and debt financing from the market to pursue a loan from the DOE, delaying completion of a SAF facility by a year.

Gevo, Inc CEO Patrick Gruber said on an earnings call this week that the company, a developer of low carbon fuels and chemicals, will forgo for now the high-cost equity and debt proposals it has received from potential investors for the construction of its first sustainable aviation fuel plant in South Dakota.

Instead, the company will seek a low-interest loan from the DOE – a decision that will delay the in-service date of its first SAF facility, known as Net Zero 1, by about a year, Gruber said.

Net Zero 1, in Lake Preston, South Dakota, is expected to be the first of several SAF projects the company is seeking to build using a modularized construction method, Gruber said. Using corn as feedstock, it would have the capability to produce approximately 60 million gallons per year of liquid hydrocarbons in the form of jet fuel and renewable gasoline. The plant is also expected to produce at least 420,000,000 pounds per year of high-value nutritional products.

The company expects to eventually secure third-party debt and equity investment in its net-zero projects, and to make money through development, fees, licenses, and a “carry” in the project – an equity interest that doesn’t necessarily require a cash investment, according to Gruber.

However, Gruber added that, in the current environment, “interest rates are high and expected to go higher.” After discussions with potential equity investors, Gruber said Gevo believes that the correct approach is to secure the DOE loan guarantee. The DOE process will delay financial close into 2024 and startup of Net Zero 1 to at least 2026, Gruber said.

In late April, Gevo gave notice that its offtake arrangement with Trafigura had been canceled. Gevo last year decided to utilize ethanol fermentation technology instead of isobutanol fermentation technology to produce SAF, requiring an amendment to the Trafigura deal that the parties could not agree to.

“This gives us a little more breathing room,” Gruber commented on the call, noting that airlines would step up for the lost offtake.

Addressing specifically the benefits to Gevo in delaying the Net Zero 1 project to pursue the DOE loan, Gruber noted the company doesn’t need to make orders for long-lead items between now and then.

“It gives us time to get the financing in order, make sure we’ve got everything in order to do the best deal,” he said. “We’ve got to go along with [the DOE] path. It helps with the overall financing.”

Gruber noted during the call that Gevo is looking at existing brownfield sites to build additional SAF plants, at a cost of roughly $400m – $500m depending on existing infrastructure.

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Hydrofuel Canada issued US patents for micro ammonia production

Hydrofuel says its technology can significantly reduce the overall cost of green ammonia and the hydrogen in it to 50% of the cost of hydrogen produced via current electrolysis technologies.

Hydrofuel Canada Inc. has been issued US Patent 11,885,029 “Systems and Methods for Forming Nitrogen-Based Compounds” and has completed of their Micro Ammonia Production System (MAPS 1.0) commercial prototype, enabling high-yield, sustainable ammonia synthesis from air and water with unprecedented efficiency using a gas-phase electrochemical process.

The MAPS 1.0 and 2.0 technologies significantly reduce the costs and energy requirement of making ammonia (NH3) compared to traditional methods, according to a news release. Multiple 381 ton per year units can be combined to operate in series or parallel to increase capacity.

The US$700,000 MAPS 1.0 version uses externally produced hydrogen (H2) to synthesize with nitrogen from air to make ammonia.

The US$850,000 MAPS 2.0 system represents a major breakthrough in the production of green hydrogen and ammonia, as it addresses one of the biggest challenges in hydrogen production – the high cost of electrolysis. By combining hydrogen and nitrogen production in a single unit, MAPS 2.0 eliminates the need for separate production processes, significantly reducing the overall cost of green ammonia and the hydrogen in it to 50% of the cost of hydrogen produced via current electrolysis technologies. All Capex and Opex costs quoted exclude any government incentives or tax credits.

Hydrofuel’s MAPS 2.0 Opex, Capex, Customer Deposit (CNW Group/Hydrofuel Canada Inc.)

“We are thrilled to announce the issuance of our US patent for MAPS 1.0 and the completion of our commercial prototype” said Greg Vezina, Chairman and CEO of Hydrofuel Canada. “This is a major milestone and a significant step towards making clean energy and fertilizer more affordable and accessible with MAPS 1.0 units expected to be available by the spring of 2025. With MAPS 2.0 expected to be released in the summer of 2025, customers will be able to produce and store green hydrogen in ammonia at a fraction of the cost, making it a game-changer in the clean energy and fertilizer industries. We will soon announce details of our pre-order campaign that will enable customers to place a small deposit on one of our MAPS units for early delivery.”

The company is currently in talks with potential partners and investors to bring MAPS 1.0 and 2.0 to the market and make a significant impact in the clean energy and fertilizer sectors. With the US patent and commercial prototype completed, Hydrofuel Canada is one step closer to achieving their goal of making green energy and chemicals more affordable and accessible for all.

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exclusive

Renewables developer exploring move into green hydrogen

North Carolina-based Strata Clean Energy is engaged with engineers and consultants in preparations for a potential move into the production of green hydrogen.

Strata Clean Energy, the North Carolina-based utility-scale renewables developer, is researching locations in the U.S. where it could potentially build a green hydrogen production plant, executives said in an interview.

“We’ve been doing some hydrogen work for the past few years,” said Tiago Sabino Dias, former CEO of Crossover Energy, which was acquired by Strata in a deal announced this week. That forward momentum on green hydrogen and other areas of the energy transition was part of the reason the deal with Strata was made, he said.

Sabino Dias is now the senior vice president of origination at Strata following the takeover.

“We’ve done a lot of work thinking about where the high-value locations are,” Strata’s Chief Development Officer Josh Rogol said in a separate interview.

Hydrogen is adjacent to Strata’s core competencies in energy storage, Rogol said. The company is confident it could supply the green kilowatt hours for hydrogen production and is researching offtake scenarios in transportation and industrial uses.

Strata has a 13 GW project pipeline of standalone and combined solar and storage, according to its website, with 4 GW under management.

The company’s IPP has about 1 GW with ambitions to grow, Rogol said. It’s go-forward pipeline comprises more than 100 projects across 26 states.

Strata is now engaged with several consultants and engineers to explore green hydrogen opportunities, Rogol said. The company is open to new advisory relationships across verticals.

“We think we are really well positioned to be both the energy supplier, as well as the molecule producer,” Rogol said. The capabilities and intellectual property acquired through Crossover put the firm six to 18 months ahead of other nascent developers.

Early-stage development in green hydrogen can be funded with Strata’s balance sheet, similar to Strata’s bilateral takeover of Crossover, Rogol said. Later stage development and EPC will require “an ecosystem of partners” potentially both financial and strategic, he added.

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exclusive

AIMCo-backed midstream infrastructure firm in refi

The company, whose asset footprint includes Gulf Coast hydrogen production, today priced a debt refinancing transaction with an 8.875% coupon.

Howard Energy Partners today priced $550m of senior unsecured notes to refinance amounts outstanding on its revolving credit facility.

The company, which is majority owned by the Alberta Investment Management Corporation (AIMCo), will pay 8.875% on the notes, inside of price talk of between 8.75% – 9%, according to sources familiar with the matter.

RBC Capital Markets and TD Securities are joint active bookrunners on the deal, the sources said.

Howard in 2021 closed on the acquisition of the Javelina Facility in Corpus Christi, Texas — a treating and fractionation plant that extracts olefins, hydrogen, and natural gas liquids from the gas streams produced by local refineries.

Starting in Jan of 2023, a strategic technology partner began producing a low-carbon diesel substitute using Javelina’s hydrogen and CO2 as feedstocks, making it one of the first merchant “clean” hydrogen facilities on the US Gulf Coast, according to the company. HEP is also pursuing carbon capture and sequestration opportunities with its Javelina assets through a joint venture with TALOS Energy and the Port of Corpus Christi.

AIMCo acquired an initial 28% stake in HEP in 2017, and brought its ownership stake to 87% last year following the purchase of Astatine Investment Partners’ stake in the company.

Howard operates in two key segments in the US and Mexico: natural gas and liquids. The natural gas segment includes 1,175 miles of pipelines and approximately 4.3 Bcf/d of throughput capacity and 600 MMCf/d of cryogenic processing capacity.

The liquids segment includes terminalling and logistics services for refined products as well as refinery-focused off-gas handling, treating, processing, fractionation and hydrogen supply services.

Spokespersons for the company, RBC, and TD did not respond to emails seeking comment.

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Exclusive: New sustainability hedge fund to raise up to $2bn

A new hedge fund founded by a clean fuels industry veteran is gathering partners to raise up to $2bn initially for deployment into ammonia and other climate-transition technologies.

New Waters Capital, an emerging hedge fund based in New York City, is gathering its primary partners for its first fundraise of between $1bn and $2bn, founder Bill Brown said in an interview.

Brown formerly spent 15 years at North Carolina-based 8 Rivers Capital, which recently announced an ammonia project in Texas. Brown, a co-founder, sold his shares to South Korea’s SK, Inc. in that company’s majority takeover of 8 Rivers last year.

Brown recently created New Waters as a multi-strategy fund manager to invest in publicly traded companies in sustainability, AI, and clean fuels.

“The molecule-based economy is really important, and there’s some companies that have been in the molecule-based economy that are not really sure what they’re doing,” Brown said.

This creates an environment ripe for disruption, he said.

The firm is in the process of selecting its prime brokers, which will help determine the size of New Waters’ fundraises, Brown said. The first raise will be conducted in the next six months, and likely not be larger than $2bn to start.

New Waters’ law firm is Seward & Kissel.
The Wild West of molecules

Of all hydrogen produced in the US, about 65% is used for fertilizer production, Brown said. In Japan, where hydrogen is being co-fired with coal, replacing all coal-fired generation with ammonia would require 10 times the current ammonia production of the US.

“The market for molecules is so big, and yet the largest producer in the US of ammonia is CF Industries.” That company has one plant in Louisiana that represents roughly one third of total US ammonia production. “So CF is tiny compared to the opportunities out there.”

Brown said he is looking for the companies that are going to be the Valero and Phillips 66 of ammonia refining. He believes 8 Rivers is on track for something like that.

“We look at companies like that,” he said. “I think that entire market is up for grabs right now; it’s a whole new market.”

 Companies that can seize that market are the companies that are going to be part of the energy system of the future.

“In many respects right now, we’re in the Wild West, if you will, of the molecules of the future,” Brown said.

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