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Proman and Mitsubishi in MoU to develop Louisiana low-carbon ammonia plant

Ammonia produced at the facility will be primarily exported to Japan as a clean fuel to reduce emissions from coal-fired power plants.

Proman has signed an MoU with Mitsubishi Corporation to explore building a world-scale ultra low-carbon ammonia facility in Lake Charles, Louisiana, according to a news release.

The proposed plant would produce approximately 1.2 million tonnes per year of clean ammonia by incorporating state-of-the-art carbon capture and sequestration technology.

The proposed ultra low-carbon ammonia facility will be located on Proman’s existing site in Lake Charles, adjacent to Proman’s natural gas to methanol plant which is also under development.

“Proman is already a leading fertilizer producer, and we are committed to expanding our global production to drive forward ammonia’s critical role as a fertilizer, fuel and decarbonized future energy source,” Proman Chief Executive David Cassidy said in teh release. “Once completed, this state-of-the-art plant with industry-leading carbon capture technology will be a major step towards meeting the growing demand for ammonia as a clean fuel.”

Ammonia produced at the facility will be primarily exported to Japan as a clean fuel to reduce emissions from coal-fired power plants, in line with Japan’s national strategy to grow domestic ammonia consumption to help achieve its decarbonization goals.

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Hydrogen investors like patents, IEA says

More than half of the USD 10bn of venture capital investment into hydrogen firms in 2011-2020 went to start-ups with patents, according to an IEA study.

More than half of the USD 10bn of venture capital investment into hydrogen firms in 2011-2020 went to start-ups with patents, according to a joint study of patents by the European Patent Office (EPO) and the International Energy Agency (IEA).

Start-ups with patents represented less than a third of companies in the report’s data set, according to a news release summarizing the findings.

The study found that holding a patent is also a good indicator of whether a start-up will keep attracting finance, noting that “more than 80% of late-stage investment in hydrogen start-ups in 2011-2020 went to companies that had already filed a patent application in areas such as electrolysis, fuel cells, or low-emissions methods for producing hydrogen from gas.”

The percentage increases to 95% when funding acquired in the IPO/post-IPO stage is taken into consideration.

Overall, the report found that hydrogen technology development is shifting towards low-emissions solutions such as electrolysis. Global patenting in hydrogen is led by the European Union and Japan, which account for 28% and 24% respectively of all IPFs filed in this period, with significant growth in the past decade. The leading countries in Europe are Germany (11% of the global total), France (6%), and the Netherlands (3%).

The United States, with 20% of all hydrogen-related patents, is the only major innovation center where international hydrogen patent applications declined in the past decade. International patenting activity in hydrogen technologies remained modest in South Korea and China but is on the rise. In addition to these five main innovation centers, other countries generating significant volumes of hydrogen patents include the United Kingdom, Switzerland and Canada.

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Woodside Energy invests in US CO2-to-protein technology company

Woodside will invest $3m into California-based NovoNutrients under a technology development agreement.

NovoNutrients has announced the signing of a technology development agreement under which Woodside Energy would contribute up to $3m to NovoNutrients, subject to the completion of certain milestones by NovoNutrients, according to a news release.

NovoNutrients’ technology converts industrial CO2 emissions into high-quality protein, with the potential to abate greenhouse gas emissions and contribute to the world’s food and feed supply. The collaboration with NovoNutrients is aligned with Woodside’s view of carbon capture and utilization (CCU) as an emerging field offering alternative lower-carbon solutions.

NovoNutrients’ technology has been operating at a lab-scale. This agreement supports the construction and operation of a larger pilot-scale system. The pilot-scale system will seek to both advance the design of commercial-scale plants and deliver increased sample product volume for further validation by NovoNutrients’ strategic partners, including Woodside.

“Our agreement with Woodside means, together, we can deliver meaningful carbon benefits sooner, while also tackling the world’s need for protein,” said David Tze, CEO of NovoNutrients.

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Bloom Energy demonstrates 4 MW solid oxide electrolyzer

According to the company, the high-temperature, high-efficiency unit produces 20-25% more hydrogen per MW than commercially demonstrated lower temperature electrolyzers.

Bloom Energy has begun generating hydrogen from the world’s largest solid oxide electrolyzer installation at NASA’s Ames Research Center, the historic Moffett Field research facility in Mountain View, Calif, according to a news release.

This high-temperature, high-efficiency unit produces 20-25% more hydrogen per megawatt (MW) than commercially demonstrated lower temperature electrolyzers such as proton electrolyte membrane (PEM) or alkaline.

This electrolyzer demonstration showcases the maturity, efficiency and commercial readiness of Bloom’s solid oxide technology for large-scale, clean hydrogen production. The 4 MW Bloom Electrolyzer™, delivering the equivalent of over 2.4 metric tonnes per day of hydrogen output, was built, installed and operationalized in a span of two months to demonstrate the speed and ease of deployment.

“This demonstration is a major milestone for reaching net-zero goals,” said KR Sridhar, Ph.D., Founder, Chairman and CEO of Bloom Energy. “Hydrogen will be essential for storing intermittent and curtailed energy and for decarbonizing industrial energy use. Commercially viable electrolyzers are the key to unlocking the energy storage puzzle, and solid oxide electrolyzers offer inherently superior technology and economic advantages. Bloom Energy, as the global leader in solid oxide technology, is proud to share this exciting demonstration with the world: our product is ready for prime time.”

The current demonstration expands on Bloom’s recent project on a 100 kW system located at the Department of Energy’s Idaho National Laboratory (INL) which achieved record-breaking electrolyzer efficiency. In the ongoing project, 4500 hours of full load operations have been completed with a Bloom Electrolyzer™ producing hydrogen more efficiently than any other process – over 25% more efficiently than low-temperature electrolysis.

The INL steam and load simulations replicated nuclear power conditions to validate full capability of technology application at nuclear facilities, and the pilot results revealed the Bloom Electrolyzer producing hydrogen at 37.7 kWh per kg of hydrogen. Dynamic testing conducted at INL included ramping down the system from 100 percent of rated power to 5 percent in less than 10 minutes without adverse system impacts. Even at 5 percent of rated load, the energy efficiency (kWh/kg) was as good or better than other electrolyzer technologies at their 100% rated capacity. These results will be presented at the Department of Energy’s Annual Review Meeting in Washington DC on June 7, 2023.

“The amount of electricity needed by the electrolyzer to make hydrogen will be the most dominant factor in determining hydrogen production cost. For this reason, the efficiency of the electrolyzer, the electricity needed to produce a kilogram of hydrogen becomes the most critical figure of merit. This 4 MW demonstration at the NASA Ames Research Center proves that the energy efficiency of our large-scale electrolyzer is similar to the small-scale system tested at INL highlighting the strength of our modular architecture,” said Dr. Ravi Prasher, Chief Technology Officer of Bloom Energy. “The electrolyzer product is leveraging the Bloom platform knowhow of more than 1 GW of solid oxide fuel cells deployed in the field and providing approximately 1 trillion cumulative cell operating hours. The same technology platform that can convert natural gas and hydrogen to electricity can be used reversibly to convert electricity to hydrogen. With Bloom’s high-efficiency, high-temperature solid oxide electrolyzers, we are one step closer to a decarbonized future powered by low-cost clean hydrogen.”

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exclusive

How hydrogen from nuclear power shows pitfalls of ‘additionality’

An interview with the Nuclear Energy Institute’s Director of Markets and Policy Benton Arnett.

Tax credits for low-carbon hydrogen production in the Inflation Reduction Act represent one of the climate law’s most ambitious timelines for implementation, with the provision taking effect late last year. That means low-carbon hydrogen producers can, in theory, already begin applying for tax credits of up to $3 per kilogram, depending on the emissions intensity of production.

However, IRS guidelines for clean hydrogen production have yet to be issued, and industry groups, environmentalists, and scientists are taking sides in a debate over whether the tax credits should require hydrogen made via electrolysis to be powered exclusively with new sources of zero-carbon electricity, a concept known as “additionality.”

In a February letter, a coalition of environmental groups and aspiring hydrogen producers expressed concern to the IRS that guidelines for 45V clean hydrogen production tax credit implementation would not be sufficiently rigorous, especially when it comes to grid-connected electrolyzers. Citing research from Princeton University, the group argued that grid-powered electrolyzers siphon off renewable generation capacity, requiring the grid to be backfilled by fossil power and thus producing twice the carbon emissions that natural gas-derived hydrogen emits currently.

(The group, which includes the National Resources Defense Council, Intersect Power, and EDF Renewables, among others, also argues in favor of hourly tracking, which they say would better guarantee energy used for electrolysis comes from clean sources, and deliverability, requiring renewable power to be sourced from within a reasonable geographic distance. In February, the European Commission issued a directive phasing in, over a number of years, rules for additionality, hourly tracking, and deliverability.)

Benton Arnett, director of markets and policy for the Washington, DC-based Nuclear Energy Institute, a nuclear industry trade association, does not believe the concept of additionality was part of Congress’s intent when the body crafted the Inflation Reduction Act. For one, he notes, the text of the 45V provision for clean hydrogen production includes specific prescriptions for the carbon intensity of hydrogen production as well as for the analysis of life-cycle emissions, but says nothing about additionality.

“When you get legislative text, you don’t usually have prescriptions on carbon intensities for the different levels of subsidies,” he said. “You don’t usually have specifications on what life-cycle analysis model to use – and yet all of that is included in the 45V text. Clearly [additionality] is not something that was intended by Congress.”

Reading further into the law, section 45V contains precise language allowing renewable electricity used for the production of hydrogen to also claim renewable energy tax credits, or “stacking” of tax credits. Further, the statute includes a subsection spelling out that producers of nuclear power used to make clean hydrogen can also avail themselves of the 45U tax credit for zero-emission nuclear energy production.

“It’s really hard for me to think of a scenario where the drafters of the IRA would have included a provision allowing existing nuclear assets to claim 45V production tax credits and also be thinking that additionality is something that would be applied,” Arnett said.

Text of the IRA

The NEI emphasized these provisions in a letter to Treasury and IRS officials last month, noting that, “given the ability to stack tax credits for existing sources with section 45V, the timing of when the section 45V credit was made available” – December 31, 2022 – “and congressional support for leveraging existing nuclear plants to produce hydrogen, it is clear Congress intended for existing facilities to be eligible to supply electricity for clean hydrogen production.”

Arnett adds that the debate around additionally ignores the fact that not all power generation assets are created equal. Nuclear facilities, in particular, given the regulatory and capital demands, do not fit within a model of additionality geared toward new renewable energy capacity. (Hydrogen developers have also proposed to use existing hydropower sources for projects in the Pacific Northwest and Northeast.)

This year, the NEI conducted a survey of its 19 member companies representing 80 nuclear facilities in the US. The survey found that 57% of the facilities are considering generation of carbon-free hydrogen. Meanwhile, the US Department of Energy’s hydrogen hubs grant program requires that one hub produce hydrogen from nuclear sources; and the DOE has teamed up with several utilities to demonstrate hydrogen production at nuclear power plants, including Constellation’s Nine Mile Point Power Station, Energy Harbor’s Davis-Besse Nuclear Power Station, Xcel Energy’s Prairie Island Nuclear Generating Plant, and Arizona Public Service’s Palo Verde Generating Station.

“We’re worried that if [additionality] goes into effect it’s going to remove a valuable asset for producing hydrogen from the system, and it’s really going to slow down penetration of hydrogen into the market,” Arnett said.

As for the research underlying arguments in favor of additionality, Arnett says that it appears to take the 45V provision in a vacuum, without considering some of the larger changes that are taking shape in US electricity markets. For one, the research, which argues that electrolyzers would absorb renewable capacity and require fossil-based generation to backfill to meet demand, assumes that natural gas generation will continue to be the marginal producer on the electrical grid.

“One of the shortcomings of that is that the IRA has hundreds of billions of dollars of incentives aimed at changing that very dynamic. The whole goal of the IRA is that marginal additions of power are carbon-free,” he said, noting incentives for clean electricity production tax credits, investment tax credits, supply chain buildouts, and loan program office support for all of these projects.

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Exclusive: CO2-to-SAF tech firm in new capital raise

A technology company with a novel process to convert CO2 into fuels and chemicals is extending a capital raise that previously closed with inputs from several oil and airline majors.

OXCCU, the UK-based clean fuels production company, is extending a Series A raise it closed last year with an eye on growth in the US, CEO Andrew Symes told ReSource. 

The raise, characterized as a Series A2 by Symes, is being conducted in-house, he said. It builds on the GBP 18m (USD 22.7m) Series A it finished last year, led by Clean Energy Ventures.

Aramco, ENI and United Airlines are also among the company’s backers.

OXCCU, a spin out of Oxford University, plans to raise additional money to scale its catalytic process converting hydrogen and carbon dioxide into sustainable aviation fuel (SAF) and other products. A patent grant, filed in 2020, is anticipated this year.

“We don’t want to be the project developer, we want to license to the project developer,” Symes said of the company’s business model.

Fuel made combining carbon dioxide (captured from industry or power plants) with green or clean hydrogen will be cheaper based on OXCCU’s iron-catalyst process, Symes said, which requires one step instead of the traditional two-step process.

OXCCU is looking for partners to engage with on sustainable aviation fuel (SAF) projects in the US, Symes said. This year the company will deliver a pilot plant in the US and plans to complete a 160 kilogram-per-day plant in Sheffield, UK in 2026.

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Exclusive: CO2-to-X firm seeking platform and project capital

A CO2-to-X development company with proprietary CO2 utilization technology is seeking to raise capital from potential strategic partners that would utilize its product, which can decarbonize industrial emitters while producing hydrogen and carbon monoxide. For methanol production, the company says it can reduce the amount of natural gas required per ton of methanol to 27 MMBtu, compared to the typical 35 MMBtu, “a massive change in a commodity market,” a company executive said in an interview.

HYCO1, a founder-owned CO2-to-X development company with proprietary CO2 utilization technology, is seeking partners to invest at both the platform and project level as it advances a series of commercial proposals.

Based in Houston and owned by its three founders, the firm is developing and commercializing technology that utilizes waste CO2 and methane to produce high purity hydrogen and carbon monoxide, which can then be used to make low-carbon syngas, fuels, chemicals, and solid carbon products.

The founders went “all in” on the technology and funded the first $10m for development themselves, and have since raised an additional $10m from two different ethanol producers that are planning to use the product, called HYCO1 CUBE, at their ethanol plants.

“We’re in the process of raising between $20m – $30m this year, with one or more strategics in investment sizes of $10m or more,” HYCO1 co-founder and CFO Jeffrey Brimhall said in an interview.

Beyond that, Brimhall says the firm plans to close on project financing for various projects in development, “which will spin development capital, license fees, and revenue back to HYCO1.”

HYCO1 is having direct conversations for the platform capital with the investment teams from potential strategic partners – like further ethanol producers, or specialty chemical producers and other operators of steam methane reformers.

Using the technology, the company hopes to qualify for tax credit incentives under 45V for the hydrogen produced utilizing recycled CO2 as a feedstock, as reflected in comments made last week to the IRS.

Projects in development

Meanwhile, HYCO1 is advancing a first three projects to maturity: a $175m green carbon syngas project on the US Gulf Coast; a $400m green methanol project on the Gulf Coast; and a $1.2bn green carbon synthetics project at an existing ethanol plant in Lyons, Kansas.

For the Kansas ethanol project, HYCO1 is having conversations with the “top five banks,” Brimhall said, about a project finance deal. 

“We’re starting offtake discussions for both methanol and synthetics,” he said. “And as those offtake discussions firm up, we know for a fact that big intermediaries are going to want to come in and we’re likely going to work with those who have discretionary capital that they can invest on their own account and then pull in others with them.”

The company recently entered into a 20-year carbon dioxide supply agreement with Kansas Ethanol for the project. It will be co-located with Kansas Ethanol and utilize all 800 tons per day of CO2 emitted by the plant to produce approximately 60 million gallons per year of low-carbon and zero-carbon products.

HYCO1 is working to reach FID on the Kansas project by 1Q25, but its critical path depends on getting in the pipeline of an ISODEWAXING provider, such as Chevron or Johnson Matthey, said Kurt Dieker, another HYCO1 co-founder and its chief development officer.

“Assuming a conservative schedule, assuming they get engaged in the next 10 weeks, that would put us in 1Q of next year” for FID, said Dieker, who has deep experience in the ethanol industry, having worked for ICM, the technology behind 70% of the ethanol gallons produced in the US today.

The CUBE

HYCO1’s CUBE technology essentially works as a conversion catalyst applying heat to CO2 and methane to create hydrogen and carbon monoxide, the building blocks of virtually all petrochemical and carbon-based downstream products.

The company built a pilot facility in Houston two years ago, and has been characterizing the catalyst with 10,000 hours of uptime operation and data on how it works, Brimhall said.

As it was advancing the CUBE characterization process, the founders found they could shape the syngas ratio on the fly, moving it from 1-to-1 to above 3-to-1, he added.

“And because we’ve done the 1-to-1 all the way up to 3.5+-to-1, we also know we can produce pure CO by essentially taking the hydrogen off and using it as part of the endotherm that we need to make the reaction work,” he said. “So we could produce anywhere from pure CO to effectively pure hydrogen.”

That level of flexibility with a “single plant, single process, single catalyst” has never been done before, according to Brimhall, and it gives the company “immense capabilities to go into virtually any situation and solve for decarbonization and at the same time make high value products downstream.”

He added, “When we talk to people that really know the space and know industrial gases, they’re like, ‘Wait a minute, you can do that?’”

Methanol efficiencies

HYCO1 is currently in talks with six super major methanol producers about using the company’s technology for methanol supply, Brimhall said.

“Every one of them immediately went to diligence on our technology,” he said, noting that HYCO1 has promised to make natural gas-based methanol production more efficient, requiring only 27 MMBtu of natural gas per ton of methanol versus the typical 35 MMBtu of natural gas. 

“The difference between 35 MMBtu and 27 or 25 is a massive change in a commodity market,” Brimand said, “and whoever owns that technology is going to have a competitive advantage.

The methanol majors are evaluating how to use the technology to their benefit, which, according to Brimhall, might require them to make an investment in HYCO1 along with the first plant. 

“We’ve spent the last three or four months driving the technical diligence part with a team of 15 engineer PhDs to basically come back and say to them, ‘Here’s the proof, here’s the number.’”

HYCO1 plans to offer it concurrently to all of the methanol producers in order to extract the best terms on the first projects, he said.

Project developer or licensor?

HYCO1’s business model comes down to whether they are a project developer or a licensor of technology. According to Brimhall, they are a project developer first and a technology licensor second.

“We have to be project development oriented in our minds across multiple verticals in order to get traction and proof, viability, efficacy,” he said. “So we’re acting in a kind of a super-project developer mode to ultimately get the attention of big offtakers, strategic partners, and potential licensors downstream.”

However, a large licensor will not likely step in to provide a multi-project license until they see the product working at scale given the breakthrough nature of the technology, Brimhall said, and the economics that flow from it.

Take syngas for example, a market dominated by a few large players like Air Liquide, Air Products, and Linde. HYCO1 wants to position its first project in that sector and then start having licensing discussions with those big firms, or additional engineering firms like Technip, Fleur, or Bechtel.

The large firms could provide an initial “bolus” of capital to HYCO1 for having developed the technology “and getting a license that means something, whether it’s geographic or it’s exclusive worldwide or it’s bi-vertical,” Brimhall said.

“There’s an initial payment that commensurates with what the market opportunity is. And then there’s a minimum they’re going to have to step up to in order to keep us satisfied that they’re really a licensor that is going to ultimately realize value to the Topco or HYCO1 as a TechCo.”

“So it’s really project development first, licensing second kind of business model,” he added. “And it’s on multiple verticals. That’s what happens when you have, you know, potent technology.”

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