Alberto Barriga – Senior Partner at DMS PARTNERS
In full evolution:
With the advent of new technologies, using special catalysts and hydrogen, “mini-refineries” for hydrotreating vegetable and animal oils emerged, generating green Biodiesel in Green Kerosene, which can be consumed alone (“drop-in”) or in mixtures with diesel or kerosene of fossil origin. They are high quality products, high storage stability, better fluid dynamics for use in diesel engines. The main products generated are called HVO (Hydrotreated Vegetable Oil, 100% renewable) and SAF (Sustainable Aviation Fuel, 100% renewable). These hydrotreating units also produce green naphtha (petrochemical raw material or gasoline additive), green propylene and green LPG, the latter in smaller proportions. All these products are generated simultaneously. Hydrotreatment removes sulfur and aromatic products, resulting in a paraffin-based hydrocarbon with a higher number of cetane, which improves diesel engine performance. As for the SAF obtained, from good licensors they produce good results in order to meet the IATA specification.
According to the International Energy Agency (IEA), global HVO fuel production in 2022 was 39.1 billion liters, while global diesel demand was 4.9 trillion liters representing just 0.08% of global diesel demand. It is estimated that 100 billion liters will be produced by 2030. For SAF, for the same year 2022, production was around 300 million liters, just 0.1% of total kerosene demand, according to IATA. These data lead us to see the growth potential of both renewables with the intense participation of Brazil due to our great potential in the production of renewable raw materials and their diversification. As we advance our technological maturity, we increase the spectrum of consumption options for bioenergy raw materials – biomass generated through photosynthesis – using organic materials of plant and animal origin, forestry, agricultural waste, industrial and domestic waste.
The main bioenergetics used will depend on the cost opportunity at the hydroprocessing unit and the agricultural characteristics of the region, logistics of
transport, labor, climate, soil quality, yields of oil content per hectare, as well as the technological maturity of the company providing the “know-how”. Today, in Brazil, the main sources of oil are palm, canola, sunflower, corn, soybean oil, among many others that appear every day.
Basic production steps in a hydrorefining unit (“mini-refinery”) for production of HVO and SAF from vegetable and animal oils:
Pre-treatment: The raw material is pre-treated to remove impurities and stored in tanks for subsequent sending to the hydrotreatment process.
Hydrogenation: The raw material is sent to the unit and treated with hydrogen produced in the unit itself, at high temperature and pressure to convert its components into clean hydrocarbons, removing contaminants and improving the carbon chain. The hydrogen used may be green (H2V) or generated from hydrocarbons or even natural gas.
Separation: Hydrocarbons are separated from the acidic water generated, which are treated to remove contaminants such as oxygen, nitrogen, water and sulfur, the latter being produced at the plant and supplied to the market.
Purification: Clean hydrocarbons are separated and sent to final storage for shipment to the market.
Hydrotreatment Licensing Companies: There are several companies in the world for the production of HVO and SAF that are registered with certifying bodies such as ASTM, IATA, CEN, among others. Below are the main companies:
Topsoe (Denmark): global leader in carbon emissions reduction technologies,
Honeywell/UOP (USA): company with various technologies,
Shell (Netherlands): energy company also highlighting Hydroprocessed Esters and Fatty Acids (HEFA) technology,
BP (UK): energy company offering technologies for the production of HVO and SAF, including Fischer-Tropsch (FT) technology.
Croda International (UK): specialty chemicals company offering technologies for the production of HVO and SAF.
Axens (France), Neste (Finland), Verbio (Germany) and Eni (Italy) among others.
The profitability of these HVO and SFA plants varies according to operating costs, ease of obtaining lower-cost raw materials, logistics, productivity, labor, availability, which are differentiated by region of implementation, efficiency production process and maintenance costs. According to the International Energy Agency (IEA), profitability is around 20 to 50%, with plants more focused on HVO production being more economically stable.
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