The future of fuels: Uncertainty quantification study of mid-century ammonia and methanol production costs
Peer reviewed, Journal article
Published version
Permanent lenke
https://hdl.handle.net/11250/3129904Utgivelsesdato
2023Metadata
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Sammendrag
Fuels supplied 76% of global final energy consumption in 2021. Although ongoing electrification efforts can significantly reduce this dominant share, fuels will continue to play a leading role in the global energy system. Hydrogen is the most studied candidate for decarbonizing fuels, but storage and distribution challenges render it impractical and uneconomical for many applications. Hence, the present study focuses on ammonia and methanol that preserve the practical benefits of traditional petroleum fuels. Four low-carbon fuel production pathways are compared using cost and performance projections to the year 2050: solid fuels (coal/biomass blends) with CO2 capture and storage (CCS), natural gas with CCS, renewables (wind & solar), and nuclear. These pathways are assessed in Europe as a typical fuel importer and in various exporting regions where the cheapest primary energy is available. A thorough uncertainty quantification exercise is conducted for all pathways to map out the likely range of future levelized costs. Results show that there are virtually no plausible scenarios where electrolytic fuels (renewables or nuclear) can compete with fuels produced from hydrocarbons equipped with CCS. Ammonia or methanol from solid fuels present a particularly attractive solution for affordable carbon-negative energy security, whereas ammonia from natural gas offers a promising decarbonized alternative to liquified natural gas exports. Based on these findings, a technology-neutral policy framework is recommended instead of targeted support for electrolytic fuels.