EC signs off on $1.2 billion of funding for low-carbon projects
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 plant will recover 70% of the carbon present in non-recyclable materials and avoid the emission of 3.4 million mt of CO2-e over its first 10 years of operation. Ecoplanta is a joint venture of Enerkem, Repsol, and Agbar.
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.
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