Assessing the Feasibility and Cost of Decarbonizing the U.S. Refinery Sector

P. Sun, V. Cappello, A. Elgowainy, P. Vyawahare, O. Ma, K. Podkaminer, N. Rustagi, M. Koleva, M. Melaina.
Argonne National Laboratory,
United States

Keywords: Refinery decarbonization, renewable hydrogen, carbon capture, biocrude

Summary:

In the United States, the combustion of petroleum fuels mainly in the transportation and power sectors contributes to almost 50% of the total CO2 emissions. Within the refinery fenceline, the onsite emission were 190 million metric tons (MT) in 2019, while the well-to-gate (WTG) emissions generated by refinery operations were 420 million MT. However, the usage of refinery products, mainly fuels (gasoline, jet fuel, diesel, heating oil) released 2410 million MT of CO2, representing 85% of the life-cycle emissions from refinery products. Therefore, decarbonization opportunities for the refining sector need to be identified while considering both the WTG and the well-to-wheel (WTW) emissions of refinery fuels. A life-cycle analysis on refinery products was conducted to evaluate the emission reduction potential in the U.S. refineries by combining several decarbonization strategies. In this study, three decarbonization strategies were analyzed: 1. Replacement of the fossil-based energy sources with renewable sources. 2. Implementation of carbon capture and storage (CCS) technologies in the refinery. 3. Substitution of crude oil with bio-crude. While the first two approaches directly affect the WTG refinery emissions, only by replacing crude oil with biocrude the WTW emissions can be effectively reduced. The 2019 energy and emissions data for U.S. refineries were used as a baseline. By switching to renewable sources — electricity from solar, wind, or nuclear power, renewable natural gas, and green hydrogen — the refinery WTG emissions could be reduced by 47%, with an associated cost of $0.8–$6/bbl of crude processed (i.e. $25–$128/MT of CO2). An additional 34% reduction in WTG CO2 emissions could be achieved if CCS were implemented for steam methane reforming, fluid catalytic cracking, and flue gases treatment. The adoption of CCS would increase the decarbonization cost to $2.4–$12.6/bbl of crude (i.e. $43–$225/MT of CO2). The reduction of WTW emissions was evaluated considering different blending ratios of biocrude. A potential reduction of 102% was observed when processing 100% biocrude from biomass gasification and Fischer-Tropsch process, while simultaneously switching energy sources and using CCS. The estimated decarbonization cost when all the three strategies were adopted increased to $54–$227/bbl of crude (i.e. $113–$447/MT of CO2), due to the high cost of the biocrude. A sensitivity analysis on the feedstock costs showed that by reducing the price spread between fossil energy and renewable energy (especially biocrude), the economic feasibility of deep refinery decarbonization would largely improve.