Cost of Some Hydrogen Fuel Infrastructure Options

Marianne Mintz Stephen Folga John Molburg Jerry Gillette

Transportation Research Board January 16, 2002

Argonne National Laboratory Transportation Technology R&D Center

Focus of Presentation Is on:
• Cost modeling process • Pathways – Components – Arrangement – Key assumptions • Hydrogen delivery volumes • Illustrative component cost analyses • Results

Argonne National Laboratory Transportation Technology R&D Center

Cost Modeling Was Conducted Via a Five-Step Process
• Define paths – NG compression, storage and transport – Hydrogen production – H2 compression, storage and transport – Hydrogen dispensing • Determine “tank-in” fuel requirement – HFCV market penetration & efficiency • Size pathway components • Estimate component costs • Calculate pathway costs (NICC model)

Argonne National Laboratory Transportation Technology R&D Center

Three Pathways H Storage Were Modeled H Transmission
2 2

NA NG Extraction

NG Purification

ResourceCentered H2 Production
H2 Distribution NG Transmission

H2 Fuel Station

MarketCentered H2 Production

NG Storage NG Distribution Regasification

Decentralized H2 Production
Compressed Natural Gas

NNA NG Extraction

NG Liquefaction NG Plant Purification Fischer-Tropsch Plant Methanol Plant

Tanker Oil Pipeline Diesel Fuel Station Transport Methanol Distribution Methanol Fuel Station

Argonne National Laboratory Transportation Technology R&D Center

Steam Reforming Inputs Are Water and Hydrocarbon Feedstock; Outputs Are Hydrogen and Purge Gases

Argonne National Laboratory Transportation Technology R&D Center

All Pathways Include Underground Storage
At the end of 1998 there were 410 underground natural gas storage sites in the U.S.

With 76 Bcf per day of Withdrawal Capability and 3,933 Bcf of Working Gas Capacity

Argonne National Laboratory Transportation Technology R&D Center

All Pathways Require Additions to the Existing Natural Gas Transmission Infrastructure

The US has an extensive in-place NG transmission infrastructure …………..
Argonne National Laboratory Transportation Technology R&D Center

And a Track Record of Continually Expanding Transmission Capacity
• New pipelines • Additional compression • Looping • All of the above

Argonne National Laboratory Transportation Technology R&D Center

According to EIA, Nearly $5 bln Was Spent on Pipeline Expansion in 2000
8,000 7,000 Millions of Dollars 6,000 5,000 4,000 3,000 2,000 1,000 0
Source: EIA 2001

Completed

Proposed

4,876 (Estimated)

2,380 2,124 (Preliminary) 1,397 552

1996

1997

1998

1999

2000

Argonne National Laboratory Transportation Technology R&D Center

Components of the ResourceCentered Pathway H Storage
2

ResourceCentered H2 Production NA NG Extraction NG Purification NG Transmission

H2 Transmission H2 Distribution MarketCentered H2 Production NG Storage

H2 Fuel Station

Decentralized H2 Production NG Distribution

Compressed Natural Gas

Argonne National Laboratory Transportation Technology R&D Center

Hydrogen Production Is Near Natural Gas Supplies in the ResourceCentered Pathway

Argonne National Laboratory Transportation Technology R&D Center

Components of the Market-Centered Pathway
H2 Storage H2 Transmission ResourceCentered H2 Production NA NG Extraction NG Purification NG Transmission H2 Distribution MarketCentered H2 Production NG Storage NG Distribution Compressed Natural Gas Decentralized H2 Production H2 Fuel Station

Argonne National Laboratory Transportation Technology R&D Center

Market-Centered and ResourceCentered Paths Share H2 Distribution Assumptions
Component H2 Pipeline Connecting Pipeline Ring with H2 Production Plant H2 Pipeline Ring Encompassing Community H2 Pipeline Connecting H2 Refueling Stations with H2 Pipeline Ring
a

Radius (mi) N/A 25 N/A

Diameter (in) 12 12 3

Length (mi) 15 157 900 a

Assumes 180 refueling stations, a service pipeline unit length of 15 miles, and 3 refueling stations per service pipeline.
Argonne National Laboratory Transportation Technology R&D Center

Conceptual Representation of Hydrogen Pipeline Loop Supporting Local H2 Delivery
Regional H2 Production Plant L1 L2 . H2 Refueling Station

radius, r H2 Refueling Station H2 Refueling Station

H2 Refueling Station

Argonne National Laboratory Transportation Technology R&D Center

Components of the Decentralized Pathway
H2 Storage ResourceCentered H2 Production H2 Transmission

NA NG Extraction

NG Purification

NG Transmission

MarketCentered H2 Production

H2 Distribution

H2 Fueling Station

NG Storage

Decentralized H2 Production NG Distribution Compressed Natural Gas

Argonne National Laboratory Transportation Technology R&D Center

Two Market Penetration Cases Were Modeled
70% 60% 50% 40% 30% 20% 10% 0% 2005 2010 2015 2020
Total LDVs Total LDVs New Sales New Sales

2025

2030

Argonne National Laboratory Transportation Technology R&D Center

Six Cumulative Delivery Volumes, Functions of HFCV MPGE & Market Penetration, Were Modeled
MPGE
60

30% Market Penetration
6.9 bln GJ (6.6 Q)

60% Market Penetration
High Penetration Low mpg 31.2 bln GJ (29.6 Q) 25.5 bln GJ (24.2 Q) 23.4 bln GJ (22.2 Q)

74 80

5.6 bln GJ (5.4 Q) Low Penetration High mpg 5.2 bln GJ (4.9 Q)

Argonne National Laboratory Transportation Technology R&D Center

The US Accounts for 20% of Global Hydrogen Consumption , Approx. 1 Q (1999, tcf)
Captive Users - NH3 Producers - Oil Refiners2 - MeOH Producers - Other Merchant Users Total
1 2

United States 1.185 1.164 0.303 0.128 0.379 3.160

Total World1 9.662 3.721 1.428 0.489 0.570 15.872

Including US. Excluding byproduct hydrogen. Source: SRI Chemical & Health Business Services 2001. Argonne National Laboratory Transportation Technology R&D Center

Current SMR Plants Have Large Economies of Scale
Capital Cost (mln $)

$1,000 $100 $10 $1 0.1

y = 5.384E+00x6.405E-01 R2 = 0.9437

1.0

10.0

100.0

Hydrogen Production Rate (tpd)
Argonne National Laboratory Transportation Technology R&D Center

Compressor Costs Are a Function of Power
$250,000 $200,000 y = 22877x 0.4561 R2 = 0.9527

Cost ($)

$150,000 $100,000 $50,000 $0 0 50 100 150 200 250 300 Pow er Required (kW)
M ult i- S t a g e S ing le - S t a g e

y = 34037x 0.3036 R2 = 0.8655

Argonne National Laboratory Transportation Technology R&D Center

Unit Cost of NG & H2 Pipelines Vary with Pipe Diameter & Installation Technology
Capital Cost of Natural Gas Pipeline ($/mi) $200,000 $500,000 $600,000 $800,000 Capital Cost of H2 Capital Cost of H2 Pipeline, Cut/Cover Pipeline, ($/mi) Trenchless ($/mi) $400,000 $900,000 $1,000,000 $1,400,000 $300,000 $700,000 $900,000 $1,150,000

Diameter (inch)

3 9 12 14

Argonne National Laboratory Transportation Technology R&D Center

Least Cost Pathway Depends on H2 Volume; Reformers and Pipelines Are Largest Components
$40 $35 $30
Decentralized Production MarketCentered Production SupplyCentered Production

Unit Cost ($/GJ)

Refueling $25 $20 $15 $10 $5 $0
Low H2 Mkt, Hi Veh Eff Hi H2 Low H2 Hi H2 Low H2 Hi H2 Mkt, Mkt, Hi Mkt, Mkt, Hi Mkt, Low Veh Eff Low Veh Eff Low Veh Eff Veh Eff Veh Eff

Transp Savings H2 Transport H2 Production NG Transport NG Feedstock

Argonne National Laboratory Transportation Technology R&D Center

H2 Infrastructure to Fuel 100 Million+ FCVs Could Cost $500 Billion or More
Total Investment ($billion)
$800 $700 $600 $500 $400 $300 $200 $100 $0
Low H2 Hi H2 Low H2 Hi H2 Low H2 Hi H2 Mkt, Hi Mkt, Low Mkt, Hi Mkt, Low Mkt, Hi Mkt, Low Veh Eff Veh Eff Veh Eff Veh Eff Veh Eff Veh Eff
Decentralized Production Market-Centered Production Resource-Centered Production

Refueling H2 Transport H2 Production NG Transport NG Feedstock

Argonne National Laboratory Transportation Technology R&D Center

H2 Unit Cost Varies by Pathway and Feedstock Price; Volume Matters for Centralized Pathways
$40 $35

Unit Cost ($/GJ)

$30 $25 $20 $15 $10 $5 $0
Decentralized, $3/MMBtu Resource-Centered, $3/MMBtu Market-Centered, $9/MMBtu
Market-Centered, $3/MMBtu Decentralized, $9/MMBtu Resource-Centered, $9/MMBtu

0.E+00

1.E+10

2.E+10

3.E+10

4.E+10

Cumulative Production (GJ)

Argonne National Laboratory Transportation Technology R&D Center

Some Conclusions:
• With current technologies, on a well-to-tank basis, hydrogen is likely to be at least twice as costly as gasoline. • With current technologies, the hydrogen delivery infrastructure to serve 40% of the light duty fleet is likely to cost over $500 billion. • For up to 7.5 bln GJ (7 Q) of cumulative hydrogen production, the decentralized path is lowest cost. • For more than 13.6 bln GJ (13 Q), of cumulative production, the resource-centered path is lowest.

Argonne National Laboratory Transportation Technology R&D Center

Conclusions (cont’d)
• With current technologies, scale economies are large for centralized options; small for decentralized • Of the central production options, the resource-centered path is consistently lower cost (economies of scale). • H2 transport and production are the largest cost components of all paths examined, hence appropriate focus for cost reduction. • Pipeline costs may be overestimated in the literature due to improvements in excavation/installation technologies.

Argonne National Laboratory Transportation Technology R&D Center

Carbon Intensity of World Primary Energy Has Been Declining Steadily

Argonne National Laboratory Transportation Technology R&D Center

Marianne Mintz mmintz@anl.gov

Argonne National Laboratory Transportation Technology R&D Center

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