Exhaust gas recirculation in gas power: the economics?

This data-file explores an alternative design for a combined cycle gas turbine, re-circulating exhaust gases (including CO2) after the combustion stage, back into the turbine’s compressor and combustion zones. The result is to increase the concentration of CO2 and thus improve the economics of carbon capture (chart below).

The data-file draws on costs data and operating parameters from several detailed technical papers, and model the economics. Even with EGR technology, it will still be challenging to decarbonize a conventional gas turbine for less than $100/ton (at which point blue hydrogen becomes competitive).

A short note is presented on the first tab, explaining the background, the theory and our main conclusions. You can stress-test the numbers and input assumptions in the model.

Deep blue: cracking the code of carbon capture?

Carbon capture is cursed by colossal costs at small scale. But blue hydrogen may be its saviour. Crucial economies of scale are guaranteed by deploying both technologies together. The combination is a dream scenario for gas producers. This 22-page note outlines the opportunity and costs.

Blue hydrogen from methane reforming: the economics?

This data-file captures the economics of hydrogen production via reforming natural gas: either steam-methane reforming (SMR) or auto-thermal reforming (ATR), which yields blue hydrogen if purified CO2 is sequestered.

Costs are drawn from technical papers in the final three tabs of the data-file, which also include our notes on blue hydrogen and an explanation of operating parameters in the model.

ATR is preferable to SMR as a decarbonization technology, eliminating 90% versus 60% of respective CO2 emissions relative to natural gas (chart below).

We find that blue hydrogen production may be competitive with CCS. Please downlaod the data-file to stress-test sensitivities to capex costs, opex costs, gas efficiency, gas prices, power prices, CO2 prices and fiscal regimes.

 

A new case for gas: what if renewables get overbuilt?

Overbuilding renewables may have unintended consequences, making power grids more expensive and less reliable. Hence more businesses may choose to generate their own power behind the meter, installing combined heat and power systems fuelled by natural gas. Modelled IRRs already reach 20-30%. Capturing waste heat also boosts efficiency to 70-80%, which can be 2x higher than grid power, lowering total CO2 by 6-30%. This 17-page note outlines the opportunity and who might benefit.

Combined heat and power: the economics?

This data-file models the energy economics of a combined heat and power installation, to provide electricity and heating behind the meter, in lieu of purchasing electricity from the grid. The economics are strong, especially for larger units.

CO2 emissions can also be reduced by 5-30%compared to purchasing power from the grid, due to high efficiency capturing and using exhaust heat in CHPs.

Economic sensitivities can be stress-tested, including to power prices, gas prices, thermal efficiencies and system sizes (examples below).

The full model also contains granular cost data, c100 rows of operational data for CHP systems and our full notes from the technical literature.

Fuel cells: decline rates?

This data-file captures the generation profiles of c100 fuel cell power plants, installed to-date in the US. Total fuel cell generation has been rising at a rate of 0.15TWH per year since 2010, almost entirely powered by natural gas.

An acceleration of fuel cellsis seen by many commentators in the future green hydrogen economy. We are more excited by behind the meter systems to compensate for the overbuilding of renewables. But what operating assumptions are reasonable, based on past data?

Advantages and disadvantages of fuel cells are summarized based on past projects’ operating parameters. We find fuel cell sysems are 2-3x more efficient than gas turbines at small scale. However, fuel cells’ flexibility and longevity is lower. Surprisingly, we also find that the electrical conversion efficiency of fuel cells deteriorates markedly over time.

A subset of the data is split out for Bloom Energy, the leading manufacturer of Solid Oxide Fuel Cells, which operates 30% of all fuel cells in the US. Leading companies in fuel cells are screened here, based on evaluating their patent filings.

Gas power: decline rates?

This data-file tabulates the power generation profiles of 3,000 US natural gas-fired power plants, which have reported data to the US EIA, aggregated using in-house web-scraping software.

Unlike wind and solar assets, which exhibit clear decline rates of 1.5% and 2.5% per year, natural gas assets run at c44% of their peak utilization rates on average, which does not change materially over time, flexing within an interquartile range that spans from 14% to 74%.

In other words, gas power plants provide flexibility and long-term reliability in a grid, as they are dialled up and dialled down over time to meet demand. This is also illustrated by looking at the underlying data of individual power plants in the file (chart below).

The data-file also presents a cautionary tale from California. To accomodate 40TWH of new utility-scale renewables generation, we show that 35TWH of gas generation has now been permanently shuttered and another 11TWH has been idled. These closures are equivalent to 30% of California’s baseload and 17% of its peakload power capacity, providing one explanation for the State’s recent rolling black-outs. Full details are split out in the data-file.

Global Energy Markets: 1750 to 2100

This model breaks down 2050 and 2100’s global energy market, based on a dozen core input assumptions.

You can ‘flex’ these assumptions, to see how it will affect future oil, coal and gas demand, as well as global carbon emissions.

Annual data are provided back to 1750 to contextualize the energy transition relative to prior transitions in history (chart below).

We are positive on renewables, but fossil fuels retain a central role, particularly natural gas, which could ‘treble’ in our base case.

A fully decarbonised energy market is possible by 2050, achieved via game-changing technologies that feature in our research.

The Top Public Companies for an Energy Transition

This data-file compiles all of our insights into publicly listed companies and their edge in the energy transition: commercialising economic technologies that advance the world towards ‘net zero’ CO2 by 2050.

Each insight is a differentiated conclusion, derived from a specific piece of research, data-analysis or modelling on the TSE web portal; summarized alongside links to our work. Next, the data-file ranks each insight according to its economic implications, technical readiness, its ability to accelerate the energy transition and the edge it confers on the company in question.

Each company can then be assessed by adding up the number of differentiated insights that feature in our work, and the average ‘score’ of each insight. The file is intended as a summary of our differentiated views on each company.

The screen is updated monthly. At the latest update, in October-2020, it contains 180 differentiated views on 90 public companies.

The Top 30 Private Companies for an Energy Transition

This data-file presents the ‘top 30’ private companies out of several hundred that have crossed our screens since the inception of Thunder Said Energy, looking back across all of our research.

For each company, we have used apples-to-apples criteria to score  economics, technical readiness, technical edge, decarbonization credentials and our own depth of analysis.

The data-file also contains a short, two-line description follows for each company, plus links to our wider research, which will outline each opportunity in detail.