There is an opportunity for natural gas to position itself as a flexibility enabler, write Eric Koenig and Shailesh Chetty of Schneider Electric.
While the global energy market is facing the impact of geopolitical and environmental challenges, we must continue to take action to move towards a greener future.
Process electrification could be the solution for oil & gas majors to accelerate energy transition in its portfolio and operations.
Process electrification is a major trend driven by greenhouse gas regulations and an increase in fundings for projects such as the LIFE Clean Energy Transition in Europe.
However, electrification of hard-to-abate industries is often considered as a threat to natural gas.
At the same time, this electrification can be hindered by the intermittent nature of renewable power and peak demand electricity prices.
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The way round this is to change this binary of ‘gas vs electrification’ approach and instead, anchor the role of gas as a transitional and complementary energy.
Electrification of various processes in industry has already started developing. It covers the electrification of mechanical drives such as compressors or pumps in industrial applications like FPSO, LNG and pipelines, as well as the electrification of various heaters or boilers in refineries and petrochemicals and hybrid process applications.
Electrification brings benefits in terms of efficiency, maintenance, and uptime. In some cases, the endgame is also to switch from fossil fuel, usually natural gas, to decarbonized electricity supply.
For example, it is possible to make industrial processes sustainable by integrating renewable energy into industrial facilities and as a result reducing scope 1 and 2 emissions.
With electrification helping to achieve sustainability targets, major industries are adopting a flexible, partial to full electrification approach.
With the development of new digital offers, it is possible to manage the complexity of growing electrical infrastructure such as electrical demands increasing to 4x-10x than base load (before process electrification) and at the same time generate significant OPEX savings by managing various electrical power sources within the facility which include a mix of renewables, conventional and utility.
There is an opportunity here for natural gas to position itself as a flexibility enabler – for accelerating the trend of electrification and securing its future. Concepts to manage hybrid power mix are introduced, which can help end-users to achieve sustainability targets and OPEX goals in parallel.
Studies conducted by McKinsey indicate about 44% of energy consumption in industrial applications is fuel consumed for energy, and this ration can be much higher on some O&G applications.
Up to approximately 400 degrees Celsius, electric alternatives to fired heaters are commercially available. Electric heat pumps for low- and medium-temperature heat demand and electric-powered mechanical vapour recompression (MVR) equipment for evaporation are already used on some industrial sites.
Electric furnaces for industrial heat demand up to approximately 1,000 degrees Celsius are technologically feasible but are not yet commercially available for all applications.
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There are already many references in the glass industry (temperatures in the 1100°C range). BASF is developing petrochemical cracking furnaces that reach 850 degrees Celsius and is planning to have them in their facilities within six years.
Electrifying compressors by large electric motors (10MW and more) with variable speed drive (VSD) system is becoming increasingly common.
The most critical point in this journey is electrical power availability. Will it be sourced externally or in-house? And can it be penetrated with clean energy or high efficiency combine cycle power plants with carbon capture, utilisation, and storage (CCUS)? This would also improve the environmental impacts through zero or limited emissions.
Striking the balance on commercial aspects (electricity economics) is critical as electricity prices can impact the economics of process electrification.
For example, in a remote gas field, the most practical solution may be to use gas direct drive or central gas turbine generation powered by project gas.
However, it will not help to achieve reduction in carbon emissions. Electrification of an asset, such as a refinery, should be seen as a long-term journey where you need the right support during the main stages.
The benefits of this longer-term electrification go beyond greenhouse gas emission reduction. Electrification allows better control, and thus drives higher efficiency. It lowers maintenance costs with better MTBF, it enables remote operations, and it allows the monetization of grid balancing in the case of grid connection.
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But electrification does not mean killing natural gas. When connected to a utility grid and/or a renewable power generation farm, there are times in the day or the year where electricity may be abundant and cheap, and other times where it will be very expensive and where the utility might be struggling to supply priority customers.
Being able to flexibly shift between gas-fired heaters and electric heaters can be a great opportunity to optimise energy bills and greenhouse gas emissions and monetize energy source flexibility.
In some other applications, such as floating production, storage and offloading (FPSO), the push for electrification will be mainly driven by efficiency and improved controls. A larger power generation and electric motor-driven compressors will be more flexible and reliable than many smaller gas turbines each driving a single mechanical load.
Full to partial electrification of processes can be achieved with three options, the first being heat pumps instead of reboilers and condensers. Second is electrical heating instead of steam or fuel-fired heaters and third is electrical motors instead of steam or gas turbines.
In all cases, greenhouse gas emissions are reduced, and equipment efficiency is improved.
The key considerations for electrification should integrate partial and flexible electrification in order to develop an accurate electrical power, steam and fuel gas model, as well as simulate every realistic operating scenario, perform reliability and availability study to compare figures with base case and, tabulate benefits in operating cost, energy efficiency and emissions.
In a greenfield scenario, it is advisable to explore the potential of partial or full electrification during the initial design stages by ensuring that all foreseeable factors have been addressed and considered up front.
Existing industrial facilities which currently use thermal energy to meet their process heating requirements, can typically reach 50% electrification with available technology.
ABOUT THE AUTHORS
Eric Koenig is Strategy VP Energies & Chemicals at Schneider Electric.
Shailesh Chetty is Technical Leader Energy Management at Schneider Electric.
