In five years’ time on the market diesel that has a net negative carbon impact

3.12.2019

From waste woody biomass to carbon negative transportation fuels via CCUS

biofuelsdigest.com/bdigest/2019/12/02/from-waste-woody-biomass-to-carbon-negative-transportation-fuels-via-ccus/

Jim LaneDecember 2, 2019

By Philipp Stratmann, VP Biofuels, Velocys

Special to The Digest

At this year’s ABLC Next Conference in San Francisco Velocys presented on the opportunity to produce negative emission fuels at our planned Bayou Fuels facility in Natchez, Mississippi.

Whilst we were not the only company presenting on advanced biofuel products at the conference, our integration of carbon capture utilization and storage (CCUS) technology into our offering sets us apart from the field.

The US is a world leader in commercializing CCUS, with several projects already in operation. However, using CCUS with a biomass-to-fuels project like ours is an industry first even for the US.

As reported by Biofuels Digest in October we announced an agreement with Oxy Low Carbon Ventures, a subsidiary of oil major Occidental Petroleum, who will take the CO2 emitted from our Bayou Fuels facility and store it underground in geological formations.

Our Bayou Fuels facility will take waste from the Mississippi paper and lumber industries – woody biomass forest residue that would otherwise rot on the forest floor. We will then convert this waste using our proprietary Fischer Tropsch process (see one of our reactors ready to be deployed below) into cleaner burning sustainable fuels for aviation or heavy duty road transport. With a standard configuration, the fuel will deliver a net CO2 saving of around 70% for each tonne of conventional fuel it displaces.

 

However, our agreement with Oxy will take the environmental benefits accrued through the waste-to-fuel process a step further. The integrated technical solution designed by Velocys is ideally suited to CCUS; the CO2 can be captured by Velocys before it enters the atmosphere and then Oxy is uniquely positioned to transport and store the CO2 by leveraging its industry leadership in CO2 storage and utilisation. A CO2 pipeline is situated just 13 miles from the site, which can easily and safely transport the CO2 away to underground geological storage.

This combination of CCUS-ready technology and Occidental’s expertise enables us to produce net negative carbon intensity fuels.

As the graph below shows the carbon intensity of conventional fossil fuel is around 90 grams of CO2 equivalent per megajoule (the exact figure used in California legislation declines slowly with time) but our sustainable fuel is around 20-30 grams. However, with CCUS our fuel from the Bayou Fuels facility will have a carbon intensity value of minus 125 grams per megajoule and avoid 550,000 tons/year of CO2 emissions.

 

The CO2 produced at our facility is very pure – over 90% – which is why it’s suited to CCUS. Arising naturally during the coversion process, the high purity gas produces a ‘ready to store’ stream of CO2.

All of this is made possible through the supportive, world leading regulations available in the US. This means that the project’s economic performance, as well as environmental performance, is significantly improved. The US 45Q tax credit incentivizes the installation of CCUS equipment on industrial facilities through the provision of an environmental performance-based tax credit. We also derive benefit from schemes such as the California Low Carbon Fuels Standard, which allows transportation fuels whose lifecycle emissions have been reduced through CCUS to become eligible for additional credits.

This all has a meaningful impact on revenue, but crucially de-risks what is the first project of its kind in the world. This is a replicable carbon negative solution that is ready to be deployed now, at Natchez and other sites in the Southeast US. We can also utilize CCUS at our UK waste-to-fuels project, subject to the UK providing policies and infrastructure similar to those in the US, and at more facilities that will follow around the world. Carbon negative fuels multiply up the benefits, and thus even a small volume can have a meaningful impact on the toughest sectors of the market: aviation and heavy goods transport.

Having already completed a Federal Government Environmental Review in Mississippi, our Bayou Fuels facility is expected to a reach Final Investment Decision by 2021 and could be producing fuel by 2024. So, in just five years’ time, trucks from California to Connecticut could be filling up with clean diesel that has a net negative carbon impact. Imagine that.