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EC signs off on $1.2 billion of funding for low-carbon projects
15 April 2022S&P Global Commodity Insights Editor
The European Commission (EC) has signed agreements for grants
totaling €1.1 billion ($1.2 billion) for funding seven low-carbon
projects including a waste-to-methanol plant in Spain, a
cross-border carbon capture and storage (CCS) hub in Belgium, and a
hydrogen and CCS project in Finland.
The seven projects aim to cut CO2-equivalent emissions by more
than 76 million metric tons (mt) during the first 10 years of
operation in sectors including chemicals, hydrogen, biofuels, CCS,
steel, cement, and solar energy.
The EU Innovation Fund receives
revenues from the EU's Emissions Trading System and is implemented
by the European Climate, Infrastructure and Environment Executive
Agency.
The largest single beneficiary is the Kairos@C project located at the
port of Antwerp, which has been granted €357 million in EU
innovation funding. Coordinated by Air Liquide, with BASF stated as
the beneficiary, the regional hub project aims to create a
cross-border CCS value chain to capture, liquefy, ship, and
permanently store CO2.
Kairos@C will deploy several technologies that together have the
potential to avoid 14 million mt of CO2-e over the first 10 years
of operation, the EC said. Operations are scheduled to start in the
third quarter of 2025, which will help it reduce CO2 emissions by
25% by 2030 from a 2018 baseline, it said when the project was
announced in November 2021.
The Kairos@C project will use a cryogenic process to capture CO2
from industrial sources on the Zandvliet industrial complex,
including two hydrogen plants, two ethylene oxide (EO) plants, and
one ammonia plant, the companies said. In a phased approach, the
project will focus first on the more CO2-intensive process streams,
namely ammonia and EO, for which no alternative or cost-effective
low-carbon technology is available. BASF's site at Antwerp is
Belgium's largest integrated chemical production complex, where Air
Liquide owns and operates two hydrogen production units where the
CO2 capture units will be added.
The CO2 will be transported by pipeline within the port to a
liquefaction and export terminal, for onward shipping and storage
in subsurface geological reservoirs in the North Sea. The
infrastructure at the port will be built in a phased approach and
operated on an open access basis, according to the EC.
The Ecoplanta project at El Morell,
near Tarragona, Spain, has been granted €106 million in EU funding,
with Ecoplanta's total project costs put at €2.5 billion, according
to the EC. The project would deliver a 237,000-mt/year
waste-to-methanol plant to supply the European market, using
municipal waste that would otherwise end up in landfills.
The 240 kilotons/year of methanol produced by the plant will be
feedstock for renewable chemicals, including acetic acid, ethylene
glycol, and acrylic acid, Enerkem said. The facility at Repsol's
existing petrochemicals facility in Tarragona is set to be
operational by the third quarter of 2026, the EC said.
In Finland, Neste's Porvoo oil refinery has been granted €88
towards its sustainable hydrogen and recovery of carbon (SHARC) project. The project
aims to reduce GHG emissions by moving away from the production of
fossil fuel-based, or grey, hydrogen toward both green hydrogen
production, using electrolysis, and blue hydrogen production by
applying carbon capture technology. The SHARC project is expected
to avoid the emission of more than 4 million mt of CO2-e over the
first 10 years, according to the EC.
Other projects that received EU grants are:
The K6 Program in France, aimed at
producing carbon-neutral cement using CO2 capture technology (€153
million). This Air Liquide and EQIOM project could capture up to 8
million mt of carbon in its first 10 years.
Enel Green Power's Tango
project in Catania, Italy, for the manufacture of bi-facial
photovoltaic modules (€117 million). With the funding, production
capacity will increase to 3 GW per year from the current 200 MW,
starting in mid-2024, becoming the largest such plant in
Europe.
A bio-energy carbon capture and storage (BECCS) project in Stockholm,
Sweden, that will combine CO2 capture with heat recovery at an
existing heat and power biomass plant (€180 million). The facility
has been in pilot plant mode since 2019, according to Stockholm
Exergi, a power producer. The EC said BECCS is expected to avoid
7.83 million mt of CO2-e during its first 10 years of
operation.
Hydrogen breakthrough iron-making technology demonstration (HBRIT) project in Oxelösund
and Gällivare, Sweden, which aims to replace fossil-based
technologies with climate-neutral alternatives such as green
hydrogen production and use (€143 million)
In addition to the projects funded by the EC, CCS got a boost in
Europe from Norway in April. Norway's state-controlled energy
company Equinor was licensed to operate
two CO2 storage locations on the country's continental shelf. The
Polaris site is aiming for 2 million mt/year of storage, and the
Smearheia site in the North Sea will provide storage "on a
commercial basis" to heavy industries, Equinor said.
Original reporting by Mark Thomas, ChemicalWeek; additional
reporting by Kevin Adler, Net-Zero Business Daily.
This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.