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Artificial Photosynthesis

JCAP Scientist:
Joel Ager

C2M Team:
Ismael Ghozael
Luc-Emmanuel Barreau
Timothy Kelly
Wesley Chen

JCAP project, support and funding


2

At the California Institute of


technology, theyre developing
a way to turn sunlight and
water into fuel for our cars
President Obama, SOTU
January 25th, 2011
JCAP funding: $122 Million over 5 years
July, 2010
JCAP formed

2016
Discovery of
efficient and
cheap
materials

2021
Assembly of
pieces into
scalable
system

2026
Increased
efficiency;
variety of fuel
types

Artificial Photosynthesis Process


3

H2O
High Voltage
PV absorber

O2

CO2
Liquid Fuel
Production

Electrolysis
H2

Liquid fuels
(Methanol)

Integrated steps


Invention (patent pending): Micro-integration of the photovoltaic absorber,


the catalyst and water High efficiency, scalability.

This technology is very early stage (<1 Year in).

Many technical unknowns




Cost target

Daily production volume

Purity

Value proposition
4

Integration: Higher efficiency and scalability

Distributed & Modular

Carbon neutral process

Stable feedstock prices

Project approach
5

Products considered

Rationale
Hydrogen is produced by
JCAPs prototype

O2

Methanol

Oxygen is produced by JCAPs


prototype

Methanol is the simplest credible


fuel candidate to synthesize

Goal: To determine target cost of products and market characteristics for


artificial photosynthesis to be competitive in these existing markets

Hydrogen Markets
6

Total H2 US Market
2010:
$22bn
9bn Metric tons

Consumption
Range
Very small
200-220 kg/day
Small
1000 kg/day
Medium
6.0 metric tons/day

97% of consumption
Large
20 metric tons/day

Industry

Hydrogen production overview


7

US production capacity, Million metric Tons


Generation size

10.7

US production:


Steam Methane Reforming


(SMR): 95%


Centralized

Distributed

Electrolysis: 4%


Source: "The impact of increased use of Hydrogen" , DoE

Mostly distributed

Production costs: heavy sensitivity on


feedstock
8

$/kg of Hydrogen

Average US - grid

Source: "The impact of increased use of Hydrogen", DoE.

Wind

Source: www.eia.doe.gov, team analysis

Solar PV

Hawaii- grid

Hydrogen distribution costs


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Quantity
Type

Cylinders

Tube trailer

Cryogenic truck

Pipeline

% Market

3% small
merchant

7% small
merchant

90% small
merchant

Large merchant

Cost

n.a.

2.6 $/kg

1.7 $/kg

0.98 $/kg

Sensitivity

n.a.

40c/100km

8c/100km

15c/100km
1200 mi,
95% in Texas and
Louisiana

Infrastructure

Source: Hydrogen and fuel cells: The US market report (picture), hydrogen.pnl.gov, DOE hydrogen project

Total costs of Hydrogen


10

Target Cost: <$6.70

$/kg

Source: "Hydrogen supply: cost estimates, NREL, Hydrogen and fuel cells: the US market report

Hydrogen Target market selection


11

First target: Distributed H2




Premium value (competing tech costs of 6.7$/kg)

Modularity valuable to customers

Limited / no switching costs

Operational limitations of the technology




Low pressure output

Intermittent production (solar) => Need for storage

Additional Possible Product: O2


12

Electrolysis: 9kg H2O -> 8kg O2 + 1 kg H2.

O2: 0.21$/kg (liquid), Premium H2: 6 $/kg

H2 value = 6$, O2 value=1.6$. O2 is a by-product.

Market

Hurdles ?

Premium O2 - Medical
gas

- Purity
- Regulatory: only electrolysis currently
approved
- Use of H2 unclear: hospitals unwilling to
operate small fuel cells

O2+H2 Petroleum
refining

- Competing with captive production

O2+H2 Rocket fuel


(NASA)

- Usage is liquid H2 and O2. Liquefaction


would be cost-prohibitive
Go, go under conditions, no-go

Decision

Why Methanol?
- Short technology path
- Low manufacturing switching cost.
- Regulatory environment is favorable
- Credible fuel alternative

Source 1 : energy.gov
Source 2: ethanolrfa.org/pages/statistics#B

Methanol markets
14

Mature markets Traditional use


Formaldehyde
Acedic Acid
Dimethyl Terephtalate
Methyl Chloride

Growth markets Energy use


Fuel blending
DME
Biodiesel

Worldwide market for methanol


15

Market size:
US imports : $1.6bn
World market : $20bn
Annual Growth:
1996-2009 CAGR 4.2%
2010-2015 CAGR 7.3%
Drivers:
Fuel category
Chinese policy

Source 1 : Methanex report 2009.


Source 2: DeWiitt & Co 2011

Methanol production cost


16

60% of production cost

25% of cost

15% of cost

Source : http://www.methanex.com/investor/documents/InvestorPresentation-April2011_000.pdf

Methanol storage and distribution


17

Imports:
64%
NE +
19%

1225T

MW +
34%

24
T

$0.42/KG

Truck/railroad movement
Source 1 JJ&A Global Methanol Report Source 2- picture : Dewitt Study

SE +
14%

Barge movement

H2 target cost for competitive price


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Transport
Distribution
42%

Pump
Price

$0.67/kg

Production
58%

Other
53%

Carbon
capture

H2
generation

Transport (*)
47%
Separation
15%
Synthesis
25%
Syngas
60%

Cost breakdown
Methanol retail price

Distributed
Generation

Distributed
H2
+ captured
CO2
$0.37/Kg
(55% of cost)

CO2
$0.10/Kg
H2
$0.27
Or
$2.16/Kg

Artificial Photosynthesis
Alternative
Source 1: Price MarkUp Methanol institute (Methanol flexible Fuel vehicle)
Source 2: Pump price Methanol Market /retailer price
Source 3: Carbone capture - http://sequestration.mit.edu/pdf/David_and_Herzog.pdf*
(*) Truck transport to MidWest location

Methanol: Longer-term opportunity


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Today the demand for methanol is happy with its supply, DOW Chemicals


TRUE: The market is indeed in equilibrium BUT growth is strong, driven by


the fuel market. This technology has the potential to accelerate this trend.

The methanol industry is extremely efficient. To compete, the cost target for
H2 with artificial photosynthesis has to decrease to 2 $/Kg.

Potential accelerating factors




Decrease in the cost of Carbon capture.

Carbon Tax

Increased technology integration encompassing to the fuel generation.

Artificial photosynthesis roadmap


20

Technology
Development

Sensitivity: electricity costs

Source: BCC research, team estimates

Sensitivity: natural gas price

Sensitivity: CO2 price

21

Appendices

Appendix Hydrogen pipeline infrastructure


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Appendix Hydrogen Tube trailers and liquid bulk


markets
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Appendix Hydrogen total costs


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Appendix Hydrogen distribution costs


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Appendix US grid electricity prices by location


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Source: http://www.eia.doe.gov/cneaf/electricity/epm/table5_6_a.html

Appendix - Hydrogen Legal Landscape


27

Federal investments in Hydrogen-related technology is ongoing: See Energy Policy


Act of 2005
Safety Guidelines for use of Hydrogen are governed by the DOE's Hydrogen
Safety Review Panel

Appendix - Why Methanol is a credible fuel!


28



The Open Fuel Standard


First introduced in the U.S. Congress in 2009, the Open Fuel Standard Act would
ensure the widespread adoption of alcohol-fuel compatible FFVs. These bills with
slight variation in current House and Senate forms would require that at least
50% of the vehicles produced for the U.S. market that use an internal combustion
engine (which would include plug-in hybrid vehicles) must be compatible with blends
up to both M-85 and E-85 fuel by the year 2012. The same rule would apply each
year until 2015, at which time 80% of vehicles produced for the U.S. must be fuelchoice enabling vehicles.
The cost for these conversions would be about $50 - $150 per car, and at current
prices, a driver would save more than that annually in fuel costs if they filled up with
M-85 all year long.
The unsubsidized cost of methanol on an energy party basis currently
averages about 90% of the cost of regular unleaded fuel.

Fuel energy density


29

Appendix - Methanol : Production cost


Methanol Plant
30

Appendix - Methanol market is fragmented


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Appendix - Methanol Spot price


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Appendix - Methanol Use by derivative


33

Appendix - Methanol (ageing) production facility


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Appendix - Methanol SMR Costs models


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Mainstream process:

Producing Methanol :costs

Gas reforming using natural gas


feedstock.
Low Cost Methanol process

$0.025

$77 per tonnes out of the gate.

Fixed Cost
(industry norm)

$0.102
$0.105

financing cost
Variable cost of
Assumptions:
production
-25 year useful life plant
- Gas cost low US$1 MMBTU
- Finance 70:30 debt/equity
at 8% on 10 years

Appendix - Methanol Storage Cost


36

Storage costs are negotiable and vary depending on the product, tank size,
special equipment required, mode of in and out bound shipments, contract terms,
etc. In a broad sense, a public terminal company would charge a base rate per
ton, per month for methanol stored in a 12,600 metric ton (100,000 barrel) tank
on a years contract. This base charge would include four tank capacity
throughputs (50,400 mt/400,000 bbls) per year, and some extra incidental costs
such as loading tank trucks and cars. Depending on customer/contract status,
these terms are negotiable, particularly if more frequent throughputs are
required. Four tank capacity throughputs per years (about a turn per quarter) are
fairly standard. Storage costs per ton can be reduced significantly by increasing
the number of throughputs per year.
Source 1 : Dewitth & Co