Decarbonisation Technology May 2022 Issue

GHG emissions are significantly reduced when compared with the conventional SMR process. Moreover, since methane pyrolysis does not require CO2 sequestration or water feedstock, it can be flexibly deployed wherever natural gas infrastructure exists. Challenges : Methane pyrolysis has been used commercially for decades to produce carbon black (tyres, plastics), but has seen limited application to date for hydrogen production. Challenges with commercialising methane pyrolysis for hydrogen production include: • Materials: Methane pyrolysis is an endothermic reaction that occurs at high temperature. Steady-state reactor designs can require specialised construction materials to meet high-temperature heat transfer requirements. • Catalysts: Catalysts can be employed in reactor designs to reduce the pyrolysis temperature and alleviate material challenges. However, these catalysts are often sensitive to poisoning and de-activation, which must be addressed through reactor and process design. • Carbon fouling: Solid carbon produced by the pyrolysis reaction can foul reactor internals, as well as catalysts used to promote the reaction. Carbon fouling adds additional system complexity and cost for its remediation. • Solid carbon disposal: Industry has limited experience sequestering solid carbon rather

than CO 2 . New approaches for handling and storing solid carbon are needed to demonstrate the viability of methane pyrolysis at scale. • Carbon markets: The availability of low-cost byproduct carbon from hydrogen production presents new opportunities for large- scale, bulk carbon utilisation in ubiquitous markets such as agriculture and construction materials. Developing these markets is a key step to maximising economic value for methane pyrolysis. Developments in methane pyrolysis Numerous methane pyrolysis platforms are under development, each taking a different approach to energy delivery, feedstock heating, and process integration. • Plasma/microwave : These techniques use plasma or microwaves to heat the reactor and provide energy for the pyrolysis process. These platforms are attractive because they are high temperature, do not require catalysts, and provide good control, which can be advantageous for producing high- quality carbon. Their drawback is that they are electricity-intensive, which adds operating costs and prioritises the use of low-cost and low carbon-intensity electricity. • Fluidised bed: These platforms use a somewhat conventional packed-bed design. Heat is applied to the reactor using electric

Grey

Blue

Green

Turquoise.

Technology inputs

SMR

SMR+CCS

PEM

Methane pyrolysis

electolysis

Capacity (TPD-H 2 ) Installed Capex ($US) NG input, kg-NG Water input, kg-H 2 0 Electricity input, kWh Steam production, MJ/kg Carbon production, kg-carbon CO 2 production, kg-CO 2 Water production, kg-H 2 0

300

Baseline assumptions NG feedstock cost: 3/GJ

$340M

$815M

$860M

+/-20%SMR

Industrial electricity: $70/MWh Renewable electricity: $30/MWh

3.7 6.0 2.0

3.7 6.0 2.8

4.8-5.3

9.0

Steam sales price: $3/GJ Carbon sales price: $0/t-C Cost of water: $0.001/litre

55.0

2.4-10 0-2.4 3.2-3.8 0.6-1.0

- -

Cost of CO 2 : $0/t-CO 2 Cost of CCS: $80/t-CO 2 Electrolyser Capex: $1,000/kW Electrolyser efficiency: 55kWh/kgH 2 Cost of capital: 10% Amortisation period: 20 years Fixed O&M: 5% Capex/year

1.0

0-2.8

Upstream GHG Emissions factors Upstream NG emissions (kgC0 2 /GJ) GHG intensity electricity grid (kgCO 2 /kWh) 0.129 (Canadian average) GHG intensity renewable electricity (kgCO 2 /kWh) 0.010 9.5

Table 1 Techno-economic analysis of hydrogen production pathways