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Topsoe to receive US tax credits for Virginia electrolyzer plant

Denmark's Topsoe is slated to receive $136m in US tax credits for a proposed electrolyzer facility in Virginia.

Denmark’s Topsoe plans to build an electolyzer factory in Chesterfield, Virginia.

The factory will manufacture advanced, energy efficient Solid Oxide Electrolyzer Cells (SOEC) that are essential to the efficient production of clean hydrogen and derivatives like eAmmonia and eMethanol, according to news release.

The decision by Topsoe to announce its plan for its largest investment in the US to date comes after the company received an allocation for nearly $136m in federal Section 48C tax credits from the Inflation Reduction Act.

Subject to Final Investment Decision, this more than $400m investment is expected to create at least 150 direct jobs in Virginia and more than 1,000 indirect jobs through the value chain.

With a planned capacity of more than 1 GW, the factory’s output of electrolyzer stacks will enable an annual greenhouse gas emission avoidance of up to 2 million tonnes CO2e – the equivalent of avoiding the emissions from more than 400,000 gasoline-powered passenger vehicles driven for a year.

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Global Clean Energy takes USDA grant for feedstock project

A $30m pilot project is meant to accelerate the market for camelina sativa as a feedstock for sustainable fuels, as demonstrated in a biofuels refinery in southern California.

Global Clean Energy Holdings and the United States Department of Agriculture (USDA) have signed a contract for the Partnerships for Climate-Smart Commodities Grant for their Climate-Smart Camelina Project, according to a news release.

With the signing, work can officially begin on their $30m pilot project to measure and validate the advantages of Camelina sativa (camelina) as an ultra-low carbon nonfood renewable fuel feedstock.

Climate-Smart Camelina is a large-scale pilot project to implement, measure, and validate the climate advantages of camelina in both rotational (fallow acres) and winter crop (e.g., in a double-crop rotation) production systems.

The project is meant to accelerate farmers’ adoption of camelina grown to produce feedstock for renewable biofuels and chemicals without causing land-use change and while increasing carbon capture in the soil.

Further, the project is meant to support market development to provide additional revenue streams to growers and provide a premium for this low carbon intensity crop.

Global Clean Energy’s wholly owned subsidiary, Sustainable Oils, Inc., contracts directly with farmers to grow camelina currently in Colorado, Idaho, Kansas, Montana, Nebraska, North Dakota, Oklahoma, Oregon, and Washington.

Camelina grain is refined in the company’s Bakersfield Renewable Fuels refinery in California.

The USDA Climate-Smart Commodities announcement can be accessed here.

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Gulf Coast ammonia plant transacts

CF Industries purchased the Waggaman ammonia plant in Louisiana from Incitec Pivot for $1.675bn.

CF Industries Holdings, Inc., a global manufacturer of hydrogen and nitrogen products, has signed a definitive purchase agreement with Incitec Pivot Limited for IPL’s ammonia production complex located in Waggaman, Louisiana, according to a news release.

The facility has a nameplate capacity of 880,000 tons of ammonia annually.

Under the terms of the agreement, CF Industries will purchase the Waggaman ammonia plant and related assets for $1.675bn. The companies will allocate approximately $425m of the purchase price to a long-term ammonia offtake agreement under which CF Industries will supply up to 200,000 tons of ammonia per year to IPL’s Dyno Nobel subsidiary. CF Industries expects to fund the remaining $1.25bn of the purchase price with cash on hand.

“We are pleased to reach this agreement with Incitec Pivot Limited that benefits from our industry-leading ammonia production capabilities, deploys our capital efficiently and provides long-term value for both companies’ shareholders,” said Tony Will, president and chief executive officer, CF Industries Holdings, Inc. “We believe the Waggaman facility will fit seamlessly into our network, as well as our strategic focus on ammonia as a clean energy source, given its proximity and pipeline connection to our Donaldsonville, Louisiana, Complex, its distribution and logistics flexibility, and its favorable characteristics for the addition of carbon capture and sequestration (CCS) technologies to enable low-carbon ammonia production.”

Ammonia produced at the Waggaman facility today is distributed ratably to three customers, including Dyno Nobel, with approximately 75% used in industrial applications. Based on the nature of the medium- to long-term offtake agreements in place with these customers, CF Industries estimates that the plant will generate gross margin per ton commensurate with its existing ammonia segment prior to synergies, which the company expects to capture through greater capacity utilization and operational and logistics optimization. Over the last five years, CF Industries’ operational capabilities have resulted in ammonia asset utilization that is approximately 10% higher than the average utilization rate of the company’s North American peers.

Additionally, CF Industries anticipates implementing CCS at the site on an accelerated timeline, increasing its network’s low-carbon ammonia production capability, supporting Louisiana’s and the country’s climate goals, and earning 45Q tax credits for sequestered carbon dioxide.

The transaction has been unanimously approved by the boards of directors of both companies and is subject to receipt of certain regulatory approvals and other customary closing conditions.

Goldman Sachs & Co. LLC is serving as the financial advisor to CF Industries on the transaction. Skadden, Arps, Slate, Meagher & Flom LLP is acting as its legal advisor. Latham & Watkins served as legal advisor to the seller while JP Morgan was financial advisor.

About the Waggaman Ammonia Production Complex

The Waggaman, Louisiana, ammonia production complex is situated on an integrated chemicals complex owned by Cornerstone Chemical Company.

  • Commissioned October 2016
  • Nameplate capacity: 880,000 tons of ammonia per year
  • Approximately 90 employees
  • 38,500-ton ammonia storage tank onsite
  • Ability to load and transport ammonia by NuStar Pipeline, barge, truck and rail
  • Located in Jefferson Parish on the Mississippi River with potential for vessel loading capabilities for low-carbon ammonia exports
  • Site is 60 miles southeast of CF Industries’ Donaldsonville Complex, facilitating resource and best practice sharing between the complexes

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UK hydrogen firm raises £36m

The funding round was led by GM Ventures, and co-led by Barclays Sustainable Impact Capital with participation from SWEN CP and Siemens Energy Ventures.

UK green hydrogen company GeoPura has received a £36m investment from global industry leaders, with the round led by GM Ventures, the investment arm of General Motors, and co-led by Barclays Sustainable Impact Capital with participation from SWEN CP and Siemens Energy Ventures to scale its green hydrogen business.

The investors will also act as strategic partners for GeoPura as it scales its hydrogen power generation technology.

GeoPura currently provides hydrogen power to Balfour Beatty, HS2, National Grid and the BBC among other sustainability-driven customers, replacing traditional diesel generators with its Hydrogen Power Unit (HPU) technology.

The HPUs are used for temporary, supplementary, off grid and backup power. GeoPura plans to grow the use of hydrogen into other hard-to-decarbonize areas of our energy system, such as EV charging and supplementary grid power, as economies continue to electrify.

With hubs in Nottingham and Newcastle upon Tyne in the UK, the £36m investment will enable GeoPura to mass manufacture HPUs alongside partner Siemens Energy, increase the production of green hydrogen to fuel the units and drive green skills in the North East and throughout the UK, while supporting the global deployment of the technology.

GeoPura plans to deploy a fleet of over 3,600 HPUs by 2033, providing clean, low-cost reliable power, and displacing more than six million tonnes of CO2 emissions through their operation over their life.

In response to customer demand, the company aims to bring a number of new products to market, addressing smaller and larger power requirements. The company will work closely with its new strategic partners to advance the technology needed to enable the mass electrification that underpins decarbonisation.

Andrew Cunningham, CEO of GeoPura, said: “Green hydrogen is too often seen as a technology that will happen in the future, but GeoPura and our partners are delivering a commercially viable technology, today. The world can’t afford to wait a decade for green fuels to scale – we must act now.

“This investment allows us to build on our installed base of HPUs and hydrogen production infrastructure to stimulate the green hydrogen economy, and then expand the use of clean fuels into other hard-to-decarbonise areas of our energy system.

“We have secured the right mix of investors, forming strategic partnerships that not only provide the funds to enable us to scale rapidly, but also the skills and resources to accelerate the transition to zero emission fuels. With the support of our investors we can help turn the market on its head and build a green hydrogen economy this decade, not next.”

Established to decarbonise global economies using zero-emission fuels, GeoPura has grown rapidly since delivering its first Hydrogen Power Unit (HPU) in collaboration with Siemens Energy in 2019. GeoPura’s HPU technology and end-to-end service is a multi-purpose replacement for diesel power worldwide and is available today. GeoPura generates hydrogen and transports the fuel to customers for use in its HPUs – customers simply rent the units and pay for the fuel used.

The company is initially targeting sectors with the highest diesel use today, such as construction, infrastructure, outdoor events, and back-up power. It is also providing a solution to power commercial EV charging, where the local electricity network isn’t capable. The only by-product is pure water and heat.

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Waste-to-energy company interviewing advisors for strategic capital raise

Vancouver-based Klean Industries plans to run a process to raise between $250m – $500m of capital to deploy into projects, some of which would use green hydrogen to upgrade recovered fuel and pyrolysis oils.

Waste-to-energy specialist Klean Industries is interviewing financial advisors and planning to run a process to find investors for a strategic capital raise.

The Vancouver-based company is seeking to raise between $250m – $500m in a minority stake sale that would value the company around $1bn, Klean CEO Jesse Klinkhamer said in an interview.

Klean had previously intended to list on the NASDAQ exchange but those plans were nixed due to the COVID-19 pandemic, he said. The company still plans to list publicly in 2024 or 2025.

Proceeds from a capital raise now would be used to “rapidly deploy” into the projects that Klean is advancing around the globe, Klinkhamer said.

For one of those projects – a flagship tire pyrolysis plant in Boardman, Oregon – Klean is raising non-recourse debt to finance construction, the executive said. Klinkhammer declined to name the advisor for the project financing but said news would be out soon and added that the company has aligned itself with infrastructure funds willing to provide non-recourse debt for the facility.

The Boardman project, which is expected to cost roughly $135m, is an expansion of an existing site where Klean will use its advanced thermal conversion technology to recover fuel oil, steel, and refined carbon black from recycled tires. The end products are comparable to virgin commodities with the exception of being more cost-effective with a lower carbon footprint.

“A lot of what we do is of paramount interest to a lot of the ESG-focused infrastructure investors that are focused on assets that tick all the boxes,” Klinkhamer said, noting the consistent output of the waste-to-energy plants that Klean is building along with predictable prices for energy sourced from renewable power.

Klean has also partnered with H2Core Systems, a maker of containerized green hydrogen production plants, and Enapter, an electrolyzer manufacturer. The company will install a 1 MW electrolyzer unit at the Boardman facility, with the green hydrogen used to upgrade recovered fuel oil and pyrolysis oil into e-fuels that meet California’s Low Carbon Fuels Standards.

“We were exploring how we could improve the quality of the tire pyrolysis oil so that it could enter the LCFS market in California,” he said, “because there are significant carbon credits and tax incentives associated with the improved product.”

The company received proposals from industrial gas companies to bring hydrogen to the Boardman facility that were not feasible, and Klean opted for producing electrolytic hydrogen on site in part due to the abundance of low-cost hydroelectric power and water from the nearby Columbia River.

Addressable market

Discussing Klean’s addressable market for waste-to-energy projects, Klinkhamer points to Japan as an example of a comparable “mature” market.

Japan, an island nation of 126 million people, has built roughly 5,000 resource recovery, waste-to-energy plants of various scopes and designations, he notes. For comparison, the United Kingdom – another island nation of 67 million people – has just 20 waste-to-energy plants.

“The opportunity for waste-to-energy in the UK alone is mind boggling,” he said. “There are a thousand opportunities of scope and scale. Nevermind you’ve got an aging, outdated electrical infrastructure, limited landfills, landfill taxes rising – a tsunami of issues, plus the ESG advent.”

A similar opportunity exists in North America, he noted, where there are around 100 waste-to-energy plants for 580 million people. The company is working on additional tire, plastic, and waste-to-energy projects in North America, and also has projects in Australia and Europe.

Hydrogen could be the key to advancing more projects: waste-to-energy plants have typically been hamstrung by a reliance on large utilities to convert energy generated from waste into electricity, which is in turn dependent on transmission. But the plants could instead produce hydrogen, which can be more easily and cost effectively distributed, Klinkhamer said.

“There is now an opportunity to build these same plants, but rather than rely on the electrical side of things where you’re dealing with a utility, to convert that energy into hydrogen and distribute it to the marketplace,” he added.

Hydrogen infrastructure

Klinkhamer says the company is also examining options for participating in a network of companies that could transform the logistics for bringing feedstock to the Boardman facility and taking away the resulting products.

The company has engaged in talks with long-haul truckers as well as refining companies and industrial gas providers about creating a network of hydrogen hubs – akin to a “Tesla network” – that would support transportation logistics.

“It made sense for us to look at opportunities for moving our feedstock via hydrogen-powered vehicles, and also have refueling stations and hydrogen production plants that we build in North America,” he said.

Klean would need seven to 12 different hubs to supply its transportation network, Klinkhamer estimates, while the $350m price tag for the infrastructure stems from the geographic reach of the hubs as well as the sheer volume of hydrogen required for fueling needs.

“With the Inflation Reduction Act, the U.S. has set itself up to be the lowest-cost producer of hydrogen in the world, which will really spur the development of hydrogen logistics for getting hydrogen out,” he said. “And to get to scale, it’s going to require some big investments.”

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See all 79 DOE hydrogen hub applicants

The list, obtained by this publication, shows whether projects were ‘encouraged’ or ‘discouraged’ to submit a final application.

The complete list of 79 applicants to the US Department of Energy’s hydrogen hub funding opportunity includes previously unreported projects from oil majors and renewable energy giants.

The list, obtained by this publication via a FOIA request, shows whether or not projects were ‘encouraged’ or ‘discouraged’ by the DOE to submit a final application before the April 7, 2023 deadline. The program is expected to offer $8bn in federal funding for six to 10 clean hydrogen hubs, with no single project receiving more than $1.25bn. A decision of funding recipients is expected this fall.

Over nearly nine months, the DOE FOIA office was unwilling to send information about the initial 79 applications that were submitted last year, citing confidential materials in the concept papers. The resulting list is therefore scant in details, showing only the name of the project and the lead entity.

While many of the concepts have been publicly announced by proponents, several major projects that have not been reported previously appear on the list: among others, ExxonMobil was encouraged to apply for funding for a project called “Hydrogen Liftoff Hub”; and NextEra has a “Southeast Hydrogen Network” project, which was also encouraged to apply.

The full list of project names and proponents has been added to The Hydrogen Source’s project database, which now showcases over 370 projects in North America, including hydrogen, ammonia, and sustainable aviation fuel as well as eFuels, carbon capture, direct air capture, and more.

The full database is available only to paid subscribers. Simply click over to the database and select the “DOE applicants” filter for the full list.

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RNG developer selling landfill gas portfolio

A Texas-based renewable natural gas developer has tapped an advisor and is selling a portfolio of waste-to-energy projects.

Morrow Energy, an RNG developer based in Midland, Texas, is working with a financial advisor to sell off a portfolio of waste-to-energy projects.

Sparkstone Capital Advisors, a boutique advisory firm based in Virginia, is the sellside advisor on the sale, according to three sources familiar with the matter.

Morrow and Sparkstone did not respond to requests for comment.

The Morrow portfolio in the US consists of 12 projects in Texas, Louisiana, Arkansas, Kansas, and Washington, according to its website.

Of note, Morrow has developed the Blue Ridge Landfill High BTU project, which is designed for up to 13,000 SCFM of raw landfill gas and can be expanded to up to 30,000 SCFM. Gas from the facility is sold and delivered to vehicle fuel markets in the US.

The company is led by Paul Morrow, its founder and president, who has worked in the RNG industry for over 20 years. Morrow Energy built its first renewable gas facility in the year 2000.

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