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Norwegian start-up tests direct ammonia fuel cell system

Alma Clean Power said the 6 kW direct ammonia fuel cell system was the highest power output ever demonstrated with this technology.

Alma Clean Power has successfully tested what it is calling the world’s first 6 kW direct ammonia fuel cell system.

The company is aiming to develop modularized Solid Oxide Fuel Cell (SOFC) systems for applications in the ocean space, and the 6-kW unit is the first building block of a complete 100-kW SOFC module. The test validates the company’s design of a direct ammonia fuel cell (DAFC) system, delivering an electrical efficiency of 61-67%, Alma said in a press release.

“I am very proud of the Alma team and their remarkable achievements in just over a year of system development. To our knowledge, this is the highest power output ever demonstrated with direct ammonia solid oxide fuel cells”, says Bernt Skeie, CEO in Alma Clean Power

Alma’s technology enables direct feeding of ammonia into the fuel cell system, bypassing the need for any energy intensive pre-treatment that converts the fuel into hydrogen prior to electricity production. With significantly higher efficiency levels compared to traditional combustion engines, this technology has the potential to make ammonia operated maritime energy systems economically viable for ship owners.

Green ammonia, produced by electrolysis powered by renewables, is a carbon-free fuel with great potential to decarbonize the maritime industries.

Alma’s SOFC system is currently operating seamlessly 24/7 and is monitored remotely with a sophisticated safety and control system. The SOFC modules are combustion-free with no rotating parts. They are designed to operate autonomously without any maintenance need for long intervals.

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CPP Investments to invest in green molecule developer

Toronto-based CPP Investments will invest an initial EUR 130m into Power2X, focused on the development of green hydrogen, methanol, and ammonia.

Canada Pension Plan Investment Board (CPP Investments) and hydrogen project developer Power2X today announced a long-term investment partnership aimed at advancing Amsterdam-based Power2X’s leading role in the global clean energy transition, according to a news release.

The partnership plans to invest an initial €130m to accelerate the growth of Power2X as a development platform and fund green molecule projects. The investment supports Power2X’s mission to become a long-term developer, owner, and operator of next-generation energy assets with a focus on green hydrogen and other clean molecules such as green methanol and ammonia.

Bruce Hogg, managing director, head of sustainable energies, CPP Investments, said: “Investing in Power2X is fully aligned with our ambition to play a leading role in the energy transition. The need for industrial decarbonization is increasing rapidly, and green molecules have a vital role to play in meeting these demands, whether to create alternative fuels, hydrogen, or renewable feedstocks such as green ammonia. With Power2X’s development capabilities and CPP Investments’ flexible capital and sustainable energies expertise, this partnership enables us to invest in next-generation energy assets at an industrial scale with long-term business partners.”

Power2X develops large-scale new energy assets and infrastructure focusing on decarbonizing industrial value chains and heavy transport in collaboration with industrial companies around the world. The company is focused on clean hydrogen, ammonia, and methanol, with a diverse portfolio of projects that are initially prioritising European demand. Under the terms of the deal, CPP Investments will acquire a majority interest in Power2X.

Occo Roelofsen, CEO, Power2X, said: “In 2020, we founded Power2X to have a lasting impact on world’s energy transition, by focusing on green and clean molecules. Working with CPP Investments will enable us to accelerate our ambition to become a leader in green molecules, and, in doing so, continue on our journey as a long-term and serious player in this critical arena of global sustainability. Announcing this partnership with CPP Investments today shows how far our team have come in a very short time. We are actively participating in hydrogen projects, such as ErasmoPower2X, a €1bn solar and hydrogen plant, and MadoquaPower2X, a €1bn industrial-scale hydrogen and green ammonia project.”

The term “green molecules” refers to the application of green hydrogen and its derivatives, including green ammonia and green methanol, to decarbonize non-power, hard-to-abate industrial activities. Notably, these green molecules can act as direct replacements for process feedstocks or transportation and heating fuels.

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Strata closes $300m revolving loan

The proceeds of the loan will support the development, construction, and operation of Strata’s upcoming renewable energy, energy storage, and Power to X projects.

Strata Clean Energy has closed a $300m new revolving loan and letter of credit facility to expand Strata’s operational fleet and accelerate the commercialization of its diversified 17+ GW development pipeline.

Nomura Securities International, Inc. (Nomura) led the financing, acting as Sole Coordinating Lead Arranger, Bookrunner, and Nomura Corporate Funding Americas, LLC as Administrative Agent, with First Citizens Bank and ING Capital as Joint Lead Arrangers alongside five other participant banks.

The loan adheres to a Green Financing Framework in accordance with the 2023 Loan Syndications and Trading Association (LSTA) Green Loan Principles. Nomura and ING Capital acted as Green Structuring Agents.

The proceeds of the loan will support the development, construction, and operation of Strata’s upcoming renewable energy, energy storage, and Power to X projects. This facility also provides working capital for Strata’s growing EPC and O&M divisions, both of which have played a pivotal role in the Company’s 15-year history of high-quality execution for its own Independent Power Producer (IPP) and third-party customers.

“This facility strengthens Strata’s liquidity position and enables us to drive forward with groundbreaking and economically viable renewable initiatives in markets nationwide,” said Alice Heathcote, CFO of Strata Clean Energy. “The support of our financial partners is instrumental in propelling us forward as a leading fully-integrated cleantech platform, offering a comprehensive one-stop solution for development through construction, with an unwavering commitment to quality.”

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8 Rivers opening tech portfolio to Chart Industries

Chart Industries has executed a memorandum of understanding with 8 Rivers Capital evaluate the latter’s portfolio of technologies, according to a news release.

The collaboration includes developing equipment for 8 Rivers’ technologies backed up by Chart’s design and manufacturing capabilities.

”The companies will work together to identify and develop commercial opportunities to integrate Chart offerings into 8 Rivers projects,” the release states.

In March The Hydrogen Source reported that North Carolina-based 8 Rivers was scouting for a location in the US Gulf Coast for its first clean hydrogen production facility and would need to raise capital.

The firm has developed new technologies such as 8RH2, a process to generate hydrogen with full carbon capture, and the Allam-Fetvedt Cycle, a process which helps to generate power from carbon-based fuels without air emissions.

Chart would become one of the suppliers of choice for various liquefaction, refrigeration processes, or liquefaction and refrigeration equipment technologies, cold boxes, heat exchangers, compressors, fans, liquid hydrogen storage tanks and trailers, and other associated equipment needed to implement 8 Rivers’ technologies.

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California renewables firm in talks for green fuel co-development

A utility-scale solar and storage developer based in California has started outreach and discussions to have green fuels projects co-developed at some of its larger sites in the western US.

RAI Energy, the California-based solar and storage developer, has started to engage with other companies about developing green fuels along with its utility-scale projects, CEO and owner Mohammed S. Alrai said in an interview.

RAI recently took a development loan from Leyline Renewable Capital. That transaction ends a process launched by Keybanc first reported by The Hydrogen Source.

Alrai remains the 100% equity owner, he said. The liquidity from Leyline will last about two years.

The company’s most impending projects are in Colorado and California, Alrai said. Discussions around green fuels envision a partner coming in as a co-developer and customer for RAI’s renewable power.

“We’re definitely open to entering into conversations with all stakeholders,” Alrai said, adding that the effort could require capital raising. “We will be coming to the market to potentially raise equity.”

RAI is moving toward long-term ownership and operation of projects, he said. The company could also sell projects to raise capital.

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Reaching bankability: The developing financial landscape around green hydrogen

Panelists at the S&P Platts Global Power Markets conference discussed existing and future opportunities to finance hydrogen production, storage and transport.

Decarbonizing is no longer an option: almost every company in every industry understands that’s the direction in which they need to be moving – now.

And for some companies, hydrogen is the only solution, Fanny Charrier, hydrogen Americas coordinator at Crédit Agricole CIB, said during the Fueling Tomorrow with Hydrogen panel at the S&P Platts Global Power Markets conference this week.

Even so, the project menu is limited.

“We haven’t seen many projects to finance,” Charrier said. “Everybody’s waiting.”

ACES Delta in Utah is thus far the only producing green hydrogen project in the US to raise financing, Charrier said. Credit Agricole is thus focused on M&A debt and equity advisory.

“What we’re looking at is mostly pure green hydrogen projects,” she said. Green ammonia shipping to Europe is a main end-use and market. Project sizes range from a few million up to USD 5bn. “We’re also supporting some electrolyzer manufacturing plants.”

Mobility, heavy trucks and shippers looking for hydrogen is a potentially huge market, but hasn’t materialized yet, she said.

Demand signals

In Europe, commitments to close traditional power generation assets hold promise for clean fuels, António Fayad, manager of hydrogen strategy at EDP Renewables, said during the panel. In the US, EDP is mainly looking to industry to buy hydrogen at or adjacent to factories and other relevant facilities.

There has been a strong, customer-led demand signal from the US, said Sam Bartholomaeus, vice president of power and renewables at Woodside Energy. Woodside was already considering a hydrogen project in Oklahoma when the IRA was passed.

“The signal was already there in terms of seeing demand sectors that need to be decarbonized and seeing that we had a competitive proposition,” he said of the hydrogen portfolio Woodside is developing in the US.

Woodside recently signed a contract for Air Liquide to provide liquefaction equipment for a hydrogen project in Ardmore, Oklahoma. First production at that project will begin in 2026 and Woodside is targeting FID this year.

Government support and finding offtake  

Last year, the USD 504m loan guarantee for the US Department of Energy was a huge boost for the ACES Delta in Utah, Susan Fernandez, senior director of strategy at ACES-Delta, said.

That kind of support from governments and legislatively mandated decarbonization quickens the proliferation of new hydrogen technologies and projects.

“Others will also have the ability to receive more loan guarantee dollars,” Fernandez said of the post-IRA landscape. “We’ll see more projects come to the space.”

Still, offtake is key to reaching bankability, Charrier said.

“The key is always the offtake,” she said. Rather than a chicken-and-egg metaphor, she said she likes to mention a domino effect. “Yes, at the beginning we’ll have to pay a premium, but if it’s driven by a net-zero commitment everything will fall into place.”

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Feature: Why blue hydrogen developers are on the hunt for livestock-based RNG

The negative carbon intensity ascribed to livestock-derived renewable natural gas could allow blue hydrogen production to meet the threshold to qualify for the full $3 per kg of hydrogen tax credit under section 45V. The viability of this pathway, however, will depend on how hydrogen from biogas is treated under the IRS’s final rules.

Lake Charles Methanol, a proposed $3.24bn blue methanol plant in Lake Charles, Louisiana, will use natural gas-based autothermal reforming technology to produce hydrogen and carbon monoxide, which will then be used to produce 3.6 million tons per year of methanol while capturing and sequestering 1 million tons per year of carbon dioxide.

And if certain conditions are met in final rules for 45V tax credits, the developer could apply for the full benefit of $3 per kg of hydrogen produced. How? It plans to blend carbon-negative renewable natural gas into its feedstock.

“Lake Charles Methanol will be a large consumer of RNG to mitigate the carbon intensity of its hydrogen production,” the firm’s CEO, Donald Maley, said in written comments in response to the IRS’s rulemaking process for 45V.

The issue of blending fractional amounts of RNG into the blue hydrogen production process has emerged as another touchstone issue before the IRS as it contemplates how to regulate and incentivize clean hydrogen production.

The IRS’s proposed regulations do not provide guidance on the use of RNG from dairy farms in hydrogen production pathways such as SMR and ATR, gasification, or chemical looping, but instead only define clean hydrogen by the amount of carbon emissions.

In theory, a blue hydrogen producer using CCUS could blend in a small amount – around 5% – of carbon-negative RNG and achieve a carbon intensity under the required .45 kg CO2e / kg of hydrogen to qualify for the full $3 per kg incentive under 45V. 

This pathway, however, will depend on final rules for biogas within 45V, such as which biogas sources are allowed, potential rules on RNG additionality, incentive stacking, and the appropriate carbon intensity counterfactuals. 

Furthermore, a potentially separate rulemaking and comment period for the treatment of biogas may be required, since no rules were actually proposed for RNG in 45V on which the industry can comment.

Like the treatment of electricity within 45V, there appears to be some disagreement within Treasury about the role of RNG in the hydrogen production process, with some in the Democratic administration perhaps responding to the view of some progressives that RNG is a greenwash-enabling “sop” to the oil and gas industry, said Ben Nelson, chief operating officer at Cresta Fund Management, a Dallas-based private equity firm.

Cresta has investments in two renewable natural gas portfolio companies, LF Bioenergy and San Joaquin Renewables, and expects RNG used in hydrogen to be a major demand pull if the 45V rules are crafted correctly.

A major issue for the current administration, according to Nelson, is the potentially highly negative carbon intensity score of RNG produced from otherwise vented methane at dairy farms. The methane venting counterfactual, as opposed to a landfill gas counterfactual, where methane emissions are combusted as flared natural gas (therefore producing fewer GHG emissions than vented methane), leads to a negative CI score in existing LCFS programs, which, if translated to 45V, could provide a huge incentive for hydrogen production from RNG. 

“Treasury may be struggling with the ramifications of making vented methane the counterfactual,” Nelson said.

Divided views

The potential for this blending pathway has divided commenters in the 45V rulemaking process, with the Coalition for Renewable Natural Gas and similar companies calling for additional pathways for RNG to hydrogen, the promulgation of the existing mass balance and verification systems – as used in LCFS programs – for clean fuels, and the allowance of RNG credit stacking across federal, state, and local incentive programs.

Meanwhile, opponents of RNG blending noted that it would give an unfair economic advantage to blue hydrogen projects and potentially increase methane emissions by creating perverse incentives for dairy farmers to change practices to take advantage of the tax credits.

For example, in its comments, Fidelis New Energy speaks out forcefully against the practice, calling it “splash blending” and claiming it could cost Americans $65bn annually in federal incentives “with negligible real methane emission reductions while potentially driving an increase in emissions overall without proper safeguards.”

Fidelis goes on to state that allowing RNG to qualify under 45V results in a “staggering” $510 / MMBtu for RNG, a “market distorting value and windfall for a select few sizable industry participants.”

Renewables developer Intersect Power similarly notes the potential windfall for this type of project, since the $3 credit would be higher than input costs for blue hydrogen. “Said another way, hydrogen producers using natural gas and blending RNG with negative CI will be extremely profitable, such that it would encourage the creation of more sources of RNG to capture more credits,” according to the comments, which is signed by Michael Wheeler, vice president, government affairs at Intersect.

Stacking incentives

In its initial suggestions from December, Treasury introduced the possibility of limiting RNG that qualifies under 45V from receiving environmental benefits from other federal, state, or local programs, such as the EPA’s renewable fuel standard (RFS) and various state low carbon fuel standards (LCFS).

In response, the Coalition for Renewable Natural Gas said that it does not “believe it is the intent of the Section 45V program to limit or preclude RNG from participation in” these programs. 

“In particular, a hydrogen facility utilizing RNG to produce clean hydrogen as defined in Section 45V program should be eligible to claim the resulting Section 45V tax credit, and not be barred or limited from participating in the federal RFS or a state LCFS program, if the RNG-derived hydrogen is being used as a transportation fuel or to make a transportation fuel (e.g. SAF, marine fuel, or other fuel) used in the contiguous U.S. and/or the applicable state (e.g., California), respectively,” the organization wrote.

Various commenters along with the Coalition for Renewable Natural Gas stated that the incentives should work together, and that the EPA has “long recognized that other federal and state programs support the RFS program by promoting production and use,” as Clean Energy Fuels wrote.

Cresta, in its comments, noted that the 45V credit would result in a tax credit of $19.87 per MMBtu of RNG, while almost all potential dairy RNG build-out has a breakeven cost above $20 per MMBtu — in other words, not enough to incentivize the required buildout on its own.

Including this incentive plus environmental credits such as LCFS and RINs could get RNG producers to higher ranges “where you’re going to get a lot of buildout” of new RNG facilities, Nelson said.

In contrast, Fidelis argues that the ongoing RNG buildout utilizing just the existing state LCFS and RFS credits is proof enough that the incentives are working, and that 45V would add an exorbitant and perverse incentive for RNG production.

“To demonstrate the billions in annual cost to the American taxpayer that unconstrained blended RNG/natural gas hydrogen pathways could generate in 45V credits, it is important to consider the current incentive structure and RNG value today with CA LCFS and the EPA’s RFS program, as well as with the upcoming 45Z credit,” Fidelis writes. “Today, manure-RNG sold as CNG with a CI of -271.6 g CO2e / MJ would generate approximately $70 / MMBtu considering the value of the natural gas, CA LCFS, and RFS. The environmental incentives (LCFS and RFS) are 23x times as valuable as the underlying natural gas product.”

In its model, Fidelis claims that the 45V credit would balloon to $510 / MMBtu of value generation for animal waste-derived RNG, but does precisely explain how it arrives at this number. Representatives of Fidelis did not respond to requests for comment.

RNG pathways

As it stands, the 45VH2-GREET 2023 model only includes the landfill gas pathway for RNG, thus the Coalition for Renewable Natural Gas and other RNG firms propose to add biogas from anaerobic digestion of animal waste, wastewater sludge, and municipal solid waste, as well as RNG-to-hydrogen via electrolysis.

According to the USDA, “only 7% of dairy farms with more than one thousand cows are currently capturing RNG, representing enormous potential for additional methane capture,” the coalition said in its comments.

Even the Environmental Defense Fund, an environmental group, supports allowing biomethane from livestock farms to be an eligible pathway under 45V, “subject to strong climate protections” such as monitoring of net methane leakage to be factored into CI scores and the reduction of ammonia losses, among other practices.

However, the EDF argues against allowing carbon-negative offsets of biomethane, saying that “doing so could inappropriately permit hydrogen producers to earn generous tax credits through 45V for producing hydrogen with heavily polluting fossil natural gas.”

First productive use

In issuing the 45V draft guidance in December, the Treasury Department and the IRS said they anticipated that in order for RNG to qualify for the incentive, “the RNG used during the hydrogen production process must originate from the first productive use of the relevant methane,” which the RNG industry has equated with additionality for renewables under 45V.

The agencies said that they would propose to define “first productive use” of the relevant methane “as the time when a producer of that gas first begins using or selling it for productive use in the same taxable year as (or after) the relevant hydrogen production facility was placed in service,” with the implication being that  “biogas from any source that had been productively used in a taxable year prior to taxable year in which the relevant hydrogen production facility was placed in service would not receive an emission value consistent with biogas-based RNG but would instead receive a value consistent with natural gas.”

This proposal is opposed by the RNG industry and others planning to use it as a feedstock.

“Instituting a requirement that the use of RNG for hydrogen production be the ‘first productive use’ of the relevant methane would severely limit the pool of eligible projects for the Section 45V PTC,” NextEra Energy Resources said in its comments.

Nelson, of Cresta, called the “first productive use” concept for RNG “a solution in search of a problem,” noting that it’s more onerous than the three-year lookback period for additionality in renewables.

“Induced emissions are a real risk in electricity – they are a purely hypothetical risk in RNG,” Nelson said, “and will remain a hypothetical risk indefinitely in virtually any scenario you can envision for RNG buildout, because there’s just not that many waste sites and sources out there.”

The issue, Nelson added, is that if RNG facilities are required to align their startup date with hydrogen production, the farms where RNG is produced would just continue to vent methane until they can coincide their first productive use with hydrogen.

The Coalition for Renewable Natural Gas argues that the provision “would cause a significant value discrepancy for new RNG projects creating a market distortion, greater risk of stranded RNG for existing projects, added complexity, and higher prices for end-consumers.”

The Coalition proposes, instead, that Treasury could accept projects built prior to 2030 as meeting incrementality requirements “with a check in 2029 on the market impacts of increased hydrogen production to determine, using real world data, if any such ‘resource shifting’ patterns can be discerned.”

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