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Q&A: Bringing clarity to complexity: Developing your renewable fuels roadmap

Existing refinery assets can be cost-effectively revamped to produce renewable diesel.

By Chris Egby, Refining Licensing Manager and Bart Suijkerbuijk, Global Licensing Development Manager – Downstream and New Energies on Mar 29, 2021

Renewable fuel production is top of mind for refiners around the world. They are looking to comply with low-carbon legislation, support societal and investor urgency to decarbonise, capitalise on carbon credits and trade low-carbon fuel.

In the U.S., many refiners are adapting operations in accordance with mandates like the Renewable Fuel Standard – which is increasing the blending requirements of renewable fuel into transportation fuel – and the Low Carbon Fuel Standard in California, which is requiring a 20% reduction of carbon intensity in fuel production by 2030.1 2

In the E.U., refiners are responding to the Renewable Energy Directive II (RED II), which requires fuel suppliers to supply a minimum of 14% of the energy consumed in road and rail transport by 2030 as renewable energy.3 Refiners are not only processing first-generation biofuels from arable land. They are also starting to process advanced, second-generation biofuel feeds that do not compete with food such as used cooking oil, animal fats and crops from non-arable land.

Meanwhile, refiners in the Asia Pacific and China are adapting to emerging mandates for first-generation biofuels.4 While there is not yet major legislation driving second-generation biofuel production in the Asia Pacific, companies in the region are looking to export renewable fuel feedstocks to Europe and to take advantage of the carbon credits that are generated.

To discuss these renewable fuel trends and opportunities, Chris Egby, Refining Licensing Manager and Bart Suijkerbuijk, Global Licensing Development Manager – Downstream and New Energies will host a webinar and Q&A session titled, “Bringing clarity to complexity: Developing your renewable fuels roadmap”. We asked them a few questions to gain a glimpse into the April 1st webinar and to hear what makes them most excited about the technology pathways offered by Shell Catalysts & Technologies.

Q: For renewable fuel production, you will discuss a technology pathway that involves co-processing and the Shell Renewable Refining Process (SRRP). Who would benefit most from this pathway?

Chris Egby: Essentially all refiners have the capability for co-processing. It is the first step you might take to process renewable fuels, mainly because it is a low-cost investment that utilises existing assets. There are no major changes in hardware. What is required is pretreatment of vegetable oils or meat tallow to reduce risks of the feed clogging up the catalyst and reactors. Afterward, you direct the feed into the tank and blend it up to about 10%.

For the SRRP, you can, at relatively low cost, revamp an existing hydrotreater to process 100% vegetable oil. Or, you can build a new unit and integrate it with your existing infrastructure relatively easily. These technologies are more easily adaptable into a standard refinery as opposed to alternative pathways which may require more specialised operations and technology.

Bart Suijkerbuijk: You could perceive co-processing as a way to learn the ropes with bio-feedstocks, which require sourcing from different places, setting up a supply chain and understanding their value.

You can gain learnings along the way while also making additional margin. The additional margin from co-processing can go into funding an investment for the SRRP, which utilises the same feedstocks and can process 100% biofeeds.

Learn how the Shell Renewable Refining Process can help reduce transportation emissions with low carbon fuels

Q: What is the most exciting aspect of the SRRP compared to refining technologies you’ve seen in the past?

Chris Egby: The industry is used to processing fossil fuels, as it’s done so for a hundred years. To my knowledge, this is the first time refiners are processing something completely different. Bio-based feedstocks start off completely different from fossil feeds that are pumped out of the ground. So, these are exciting times. The challenges and risks are different. It’s not a step change, but it’s a gradual change towards a product that is completely renewable.

Q: Could you share some insight into the development of the SRRP?

Chris Egby: Although the SRRP is a new technology, it’s based on technology that Shell has been developing in the industry for decades. Refiners have already been using the processes of hydrotreating followed by isomerisation to de-wax diesel to reduce cold-flow properties. Imagine if you’re going to sell diesel to cold places like Northern Russia: the wax in regular diesel could solidify on cold days and freeze in the fuel tank. That is why diesel is de-waxed. The same applies to renewable diesel and especially sustainable aviation fuel (SAF).

The SRRP follows the same processes of hydrotreating and isomerisation. The main difference is the challenges with the feed. With the SRRP, the feed is much more acidic, which can cause corrosion. As you can imagine, plant matter can become quite thick and gelatinous when processed, which form gums and plugs up operations. So even though the underlying technology is the same, the risks and challenges are different. Our R&D has focused on understanding how the different feedstocks are going to impact the processes and how they can be optimised.

Q: How can the SRRP help refiners process advanced biofuel feedstocks?

Bart Suijkerbuijk: The SRRP can process some advanced biofuel feedstocks and ongoing R&D is targeting more challenging feeds. The SRRP shares significant equipment overlap with other technologies that are designed to exclusively process advanced biofuel feedstocks. These technologies are both based on hydroprocessing.

Hydroprocessing technology is nothing else than reacting a feedstock with hydrogen to improve its quality. And because that high-level concept is the same for the SRRP, you can potentially repurpose a hydroprocessing unit to process more challenging biofuel feedstocks.

Q: Why would refiners choose to work with Shell Catalysts & Technologies on this new-to-market technology?

Chris Egby: The SRRP is distinctive from competing technologies in the market for a number of reasons, not just from a technical perspective, but also in terms of the wider scope of offerings we provide. Firstly, from a technical point of view, the SRRP incorporates a number of proprietary design elements, which we believe will result in SRRP requiring lower capital cost and producing higher yields. It also offers flexibility in terms of being able to produce renewable diesel and SAF.

Secondly, Shell Catalysts & Technologies looks for close collaboration with our customers. As an owner-operator, Shell has a vested interest in SRRP’s continued success. Shell is committed to producing biofuels, and all Shell units which are built will be with the SRRP. Shell is investing in the evolution and improvement of this technology to process different feed types that can help refiners adapt to the coming changes in the world of renewables. When we license the SRRP, we are looking for customers who can learn with us and continuously improve together.

Explore how Shell Catalysts & Technologies support more and cleaner energy with low carbon fuels

Lastly, biofuel trading is quite complicated for refiners. The markets are different for biofuels than the markets trading fossil fuels. There are lots of different legislations. In Europe, each country implements the RED II directive differently and there are many different legislations in America. This means that each of those product molecules is worth a different amount in different countries with different legislations and different feeds. It becomes very complicated to try to maximise profitability.

Shell is the biggest seller and biofuel trader in the world and has expertise to help customers understand where to place their products. By working with Shell, not only do refiners benefit from continuous improvements of the technology, but they also receive the expertise of our trading-and-supply wing to help maximise the value of their product molecules.

 

1 “Renewable Fuel Standard”, U.S. Department of Energy, accessed 26 Feb. 2021, https://afdc.energy.gov/laws/RFS.html#:~:text=The%20RFS%20originated%20with%20the,36%20billion%20gallons%20by%202022.

2 “Low Carbon and Alternative Fuel Standard”, Center for Climate and Energy Solutions, January 2019, https://www.c2es.org/document/low-carbon-fuel-standard/.

3 “Renewable Energy ­– Recast to 2030 (Red II)”, European Commission, 23 July 2019, https://ec.europa.eu/jrc/en/jec/renewable-energy-recast-2030-red-ii.

4 Chase Mcgrath, “Biofuels Annual”, United States Department of Agriculture Foreign Agricultural Service, July 31, 2020, 

5 https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Biofuels%20Annual_Beijing_China%20-%20Peoples%20Republic%20of_07-27-2020.

Watch the webinar: Bringing clarity to complexity: Developing your renewable fuels roadmap

Join the discussion on renewable fuels with Chris Egby and Bart Bart Suijkerbuijk.

Watch the webinar