The lobbies of the automotive and oil & gas industry declare that we are not ‘ready’ to go fully electric, but need ‘transition fuels’ for an unspecified period of time. Italgas planned to produce synthetic methane in Italy, but after months of promises and experimentation, they admit that technically the project is not yet feasible. The project has now been reduced to a ‘simple’ hydrogen factory, proving that the ‘transition fuels’ wanted by the fossil fuel industry are even less ready than electric itself.
Synthetic fuels or electrification? This is the question that agitates the economic sectors traditionally linked to fossil fuels such as automotive and oil & gas, which also include gas distributors, that are now looking at hydrogen and synthetic fuels as a way to keep their position in the global market.
This change of perspective creates an unprecedented alliance between the two sectors, under the guise of ‘renewable gases’. So, on the one hand, Stellantis criticises the ban on internal combustion vehicles (proposed by the European Commission as part of the Green Deal); on the other, the leading Italian gas distribution operator, Italgas, is backing the fight through the GD4S lobby – Gas Distributors for Sustainability – which is asking Europe to recognise synthetic fuels as an energy transition tool in the fight against climate change.
The hope is to be able to save, at least temporarily, the ‘endothermic’ engines (combustion-based ones), which the United Nations Conference on Climate Change, known as COP26, wanted to ban by 2040. But there is no unity in the agreement proposed in Glasgow last November. Only Volvo, Ford, GM, Mercedes-Benz, China’s BYD, and Jaguar Land Rover have agreed to put their commitment to electric cars in writing.
The bulk of the automotive industry – which includes Stellantis, BMW, Renault, Hyundai, Toyota, and the Volkswagen Group – is asking to consider all decarbonisation technologies currently available, particularly synthetic fuels. Car manufacturers say switching directly to electricity would be a leap in the dark that could create economic and social problems.
The latest frontier to stay afloat
But what is this fuel and is it actually within reach? Its production, as synthetic methane, was planned in the ‘power-to-gas’ plant that Italgas intends to build in Sestu, on the Italian island of Sardinia. But today this plan is on hold. ‘We’ll see at a later stage,’ the company explains to IrpiMedia.
On paper, producing this fuel seems simple: methane has a molecular composition of four atoms of hydrogen and one of carbon, so it would be enough to make hydrogen and carbon react to obtain it. But in practice, experts underline technical and economic limits that may be difficult to overcome.
Synthetic fuels are hydrocarbons that are made in laboratories instead of extracted from the ground. Out of all of them, methane is the easiest to obtain. Synthetic fuels are the latest frontier that both the automotive and oil & gas worlds are looking towards to stay afloat, while the rest of the world is calling for a definitive crackdown on high-emission fossil fuels.
The final efficiency of synthetic fuel, net of waste and losses, is just 13 percent, compared to 69 percent for batteries
These synthetic fuels are produced through complex industrial processes that in theory meet environmentalists’ demands: ‘green’ hydrogen (produced by electrolysis of water using electricity from wind or solar power) that is mixed with carbon (which supply projects are very vague about) and synthesised into a traditional fuel that regular internal combustion engines can use. Problem is that, according to a study published by German think tank Agora Verkehrswende (committed to studying decarbonisation strategies), the final efficiency of synthetic fuel, net of waste and losses, is just 13 percent, compared to 69 percent for batteries.
Even Italgas itself has had to admit these limitations and, in Sestu, only hydrogen production remains confirmed. This will have two uses. One of them, among the first in Italy, is the refuelling of public transport vehicles. The other one is the introduction of hydrogen into the city gas network, blended with fossil methane. However, this will happen in percentages so low that they’ll be practically negligible. But it will be enough for distributors to claim the centrality of gas networks in the energy system of tomorrow. In short, greenwashing is served.
The mirage of reducing emissions by 2030
In Europe, the strategy against global warming is called Fit for 55. It’s the set of rules the European Union is counting on to reach the goal of reducing greenhouse gas emissions by 55 percent, compared to 1990, by 2030.
The European Commission’s latest proposal dates back to last December. It concerns the decarbonisation of the gas market and contains good news for all supporters of renewable gases: hydrogen, biomethane, and synthetic methane are fine, and can also benefit from tax breaks, provided they generate 70 percent fewer emissions than natural gas.
On balance this is a victory for car manufacturers who oppose the European Commission’s proposal to retire the combustion engine by 2035 and are calling for a ‘transition period’ during which electric engines will go in parallel with synthetic fuels.
But it is also a victory for GD4S (chaired until January by Paolo Gallo, CEO of Italgas) who asked and achieved that the emissions count of so-called ‘renewable gases’ would refer to their life cycle. In practice this means that, rather than measure emissions generated at the tailpipe (the most effective way of containing pollution), what will be counted is how many greenhouse gases are recycled. It matters little, then, that the combustion of synthetic methane and biomethane (renewable gases) has the same negative impact as fossil gas. The CO2 emissions count coming from them will be ‘dumped’ on the end user instead of the producer.
A 70 percent reduction in emissions is no joke. To achieve it, synthetic methane producers must use recycled CO2, captured from emission sources (an industrial process, for example). In this way, combustion would release only the carbon dioxide used to produce the methane. A neutral cycle, at least in theory, net of losses along the process.
Introducing synthetic fuel
But CO2 capture and storage (CCS) is the rock that Italgas’s project has run into. CCS is an experimental and expensive technology, whose efficiency is much debated by scientists. The topic was addressed by CRS4, the research centre of the Autonomous Region of Sardinia to which the Turin-based company turned in late 2020 to study the feasibility of the Sestu plant. CRS4’s report led Gallo to announce ‘the possibility of producing renewable gases such as hydrogen and synthetic methane.’
‘But the fuel will not be produced, because we would need to have a CO2 capture system,’ explains researcher Alberto Varone, CRS4’s contact for the Italgas project. According to Varone, the company originally only asked for support on hydrogen. ‘It was me who suggested that the second step should be synthetic methane,’ adds the researcher. Italgas must have taken him at his word, because for months it continued to present synthetic fuel like a true flagship product of the Power-to-Gas project (giving it its very name).
It was however discovered that capturing CO2 is not straightforward, because catalysts are delicate machines, so the CO2 captured has to be as pure as possible; a requirement not all technologies will be able to meet.
Renewable gases: These are non-fossil gaseous fuels which, according to European legislation (still being debated), can be considered an effective tool in the decarbonisation process required to fight climate change. The definition is based either on the low level of emissions produced, or on the production process.
Synthetic fuels: These are non-fossil hydrocarbons produced ‘in the laboratory’ by means of synthesis processes. Basically, all hydrocarbons are molecules based on carbon and hydrogen, and can therefore be produced from a mixture of these elements.
Synthetic methane: This is the simplest of the synthetic fuels. The formula of methane (CH4) comprises one carbon atom and four hydrogen atoms. It would appear to be the first synthetic fuel to be produced on an industrial scale.
Green hydrogen: Hydrogen obtained by electrolysis of water, powered exclusively by electricity obtained from 100 percent renewable sources, such as wind or solar.
Blue hydrogen: Hydrogen produced by the breakdown of fossil gas, a process inverse to that of synthetic fuels. Its production (from fossil gas) separates hydrogen and carbon. To be considered ‘blue’ (and therefore ‘low emissions’) it must be produced together with a carbon capture process so that it is not released into the atmosphere. This technology does not seem to have reached effective levels at the moment.
Blending: In the context of this article, ‘blending’ refers to the intention of gas distributors to mix together hydrogen and methane in the existing distribution network.
CO2 can be obtained from biogas, which is rich in carbon dioxide. ‘But currently this is easier said than done,’ comments the researcher. It can also be obtained through solid oxide fuel cells, where methane is split into hydrogen and CO2. ‘This is a very expensive technology that is only just entering the market,’ explains Varone.
Even more futuristic are the options involving the sequestration of CO2 from the fumes of thermoelectric power plants: according to what IrpiMedia learned, a decade of experiments has not yet produced appreciable results and the concept as such therefore remains confined to a laboratory.
And it costs money to produce hydrogen, especially now that energy is so expensive
Moreover, in this case, a problem of scale would arise: transforming a large amount of CO2 sequestered into synthetic methane would require an even higher proportion of hydrogen. To make one molecule of CH4 (methane) you need four molecules of hydrogen and just one of CO2. And it costs money to produce hydrogen, especially now that energy is so expensive. The plant in Sestu, Italgas confirms, will not exclusively use the energy generated by the associated solar power plant, but will also draw from the grid to power its electrolyser, so the hydrogen it produces won’t even be ‘green’ unless Italgas finds another way to certify that the only energy bought from the grid is renewable.
What comes out of IrpiMedia’s research is a less than comforting picture for synthetic methane, the promised low-carbon fuel of the future. ‘At the moment, there are no installations that close the loop (from hydrogen to synthetic methane, via CCS),’ Varone confirms.
In short, synthetic fuels – intended as renewable gases, to use the Fit for 55 definition – are not the effective short-term solution that could support the energy transition phase, contrary to the gas and car lobby's main point in promoting their use.
"We have to use the different energy carriers where they are most efficient. In the case of personal vehicles, this is the electric engine"
The impossible transition
Germany has come to the same conclusion. Alongside car manufacturers, the German government has long pulled the strings in favour of synthetic fuels, hoping to reduce emissions from cars already on the road. But in January even Minister of Transport Volker Wissing, declared: ‘For the foreseeable future we will not have enough synthetic fuel to power the internal combustion engine cars currently registered.’ ‘We have to use the different energy carriers where they are most efficient,’ he said. ‘In the case of personal vehicles, this is the electric engine.’
But despite all of this, the automotive industry still calls for a strategic role for synthetic fuels in the transition phase. In Europe, they are represented by the European Association of Automotive Industries (ACEA) – which counts companies such as Stellantis, Volkswagen, Renault, and BMW among its members – who raised the undoubtedly relevant issue that is the lack of sufficient charging stations, a necessary condition to get to ‘all-electric’.
Even Carlo Tavares, CEO of Stellantis (the group that brings together brands such as Peugeot, Fiat, Jeep, Maserati, Alfa Romeo, and Lancia), has not missed any opportunity in recent years to reiterate that the choice of electricity is an imposition of governments, and that a gradual transition would be preferable. Notwithstanding this, car manufacturers are preparing for different scenarios. Stellantis is an emblematic case. Its industrial plan will be published in March 2022. It has adopted hydrogen for some commercial vehicles and has implemented hybrid drive (combustion engine and electric motor) in several models.
Blending at full throttle
Having put its synthetic methane plan on ice, Sestu’s plant is left with the other aims it was developed for, such as the injection of a mixture of hydrogen and fossil gas (blending) in the city gas grid. This prospect has been debated since 2019, when SNAM injected a percentage equal to 10 percent by volume of hydrogen into its transmission network in Contursi Terme, in the province of Salerno. In the case of Sestu, Italgas explained to IrpiMedia, the percentage, at least at the beginning, would lie between 2 and 3 and then grow over time.
Sestu will continue to sell gas, but is dressing it up as a green innovation
The word to focus on here is ‘volume’: in energetic terms the share of hydrogen in the mixture would be far lower than 10 percent. The reason for this is easy to explain: hydrogen is a less dense gas than methane, because it has a lower molecular weight. Therefore, with the same volume, hydrogen delivers less energy. The result is that the percentage, in energy terms, of the mixture introduced into the network in Sestu, will at present be less than 1. In other words, they will continue to sell gas, but are dressing it up as a green innovation.
You do not mess with hydrogen. Due to the small size of its molecules it can cause significant damage to transport infrastructures (pipelines), altering the performance of steel, or to compression stations, decreasing their pressure.. Moreover, the final mile of transportation into homes, such as in Sestu, is often through polyethylene pipes. This makes blending even more experimental, so to speak.
When it comes to the introduction of hydrogen into gas networks there is still no reference standard, neither for steel nor for polyethylene pipes. Obviously, there is turmoil surrounding the issue: in fact, last December the European Commission presented its policy on blending, proposing to set the level of hydrogen that can be blended in pipelines at 5 percent by volume; once again, a rather small percentage.
To facilitate fuel blending in Italy in the immediate future, a change to Ministry for Economic Development’s decree that regulates the introduction of gas into the network is being evaluated, but it is being held up by the certifying entities, in particular UNI (CEN for Europe), who have yet to define technical standards. Fuel blending is also being addressed by the Italian Energy Regulatory Authority, which recently asked the Ministry of Ecological Transition to set the percentages of hydrogen that can be injected into the grid together with fossil gas.
Another risk connected with hydrogen blending is that one has to be careful of its effects on households. In shares around than 5 or 10 percent by volume it could compromise domestic appliances (boilers and stoves). Hydrogen has a higher flame temperature. This is why 300 participants in a British trial will be equipped with hydrogen-ready appliances.
Network storage and lobbying in Brussels
Distribution companies are demanding permission to feed increasing amounts of hydrogen into the grid, even before producing it. There’s a reason: blending is the expedient used to store hydrogen and to support the strategic importance of distribution networks. Using cylinders or high-pressure storage (up to 700 bar) has proven extremely inconvenient, a source reveals, adding: ‘It takes too much energy, and the economic viability of the plant is at its limit.’
Confirmation of grid storage also comes from lobbying conducted by GD4S. In October 2021 Gallo met with European Energy Commissioner Kadri Simson. On the agenda was a document, the title of which sounded like a manifesto: ‘Gas networks, the key that enables decarbonisation.’ This white paper called for the possibility of injecting increasing volumes of renewable gas, through a revision of the rules on injection, including incorporating the connection costs of the gas mix into network tariffs. This would leave the end consumer to foot the bill.
The return of synthetic methane
The fate of synthetic methane seems tied to incentives, although it cannot be said that Italgas has so far desisted from the hypothesis of producing it, even if the wind is not yet blowing in the right direction for them. On January 18, the company announced it had entered into an agreement with Buzzi Unicem, an international cement group, for a feasibility study into ‘converting electricity from renewable sources into a synthetic gas that can be used to power boilers and kilns in our factories,’ Luigi Buzzi, the company's technical director, explained to IrpiMedia.
The plants that use CO2 must be close to where gas is produced, if possible in the same cement plants
‘The first phase involves electrolysis of water to generate hydrogen and oxygen, followed by a methanation process in which the hydrogen that is generated reacts with the CO2 captured by the cement plant’s emissions, giving rise to methane gas.’ It comes down to realising the complete cycle of power to gas – which could not be done in Sestu – starting from CO2 produced by existing plants.
Cement plants possess the holy grail of synthetic methane: pure carbon dioxide, necessary for the production of artificial fuels. Sequestering is being experimented with as part of the Clean Clinker project, using funds from the European Horizon 2020 program. It is ‘currently being tested on a pilot scale in our cement plant in Vernasca (PC),’ Buzzi added. ‘In a few months we will have important feedback on the industrial feasibility of such a solution.’
It is a project intended to revive the Sestu synthetic fuel initiative, but in a different location, because the main problem is transportation: the plants that use CO2 must be close to where gas is produced, if possible in the same cement plants. A mechanism that transforms CO2 from a problem into a resource could potentially have the opposite effect: transforming gas and CO2 into a high-value commodity might as such incentivise its production.
Additional reporting: Francesca Cicculli, Carlotta Indiano