Assessing the impacts of low-carbon intensity hydrogen integration in oil refineries

Abstract

This paper evaluates the potential impacts of introducing low-carbon intensity hydrogen technologies in two oil refineries with different complexity levels, emphasizing the role of hydrogen production in reducing CO₂ emissions. The novelty of this work lies in three key aspects: Comprehensive system analysis of refinery complexity using real site data, integration of low-carbon Hydrogen technologies, long-term and short-term strategies. Two Colombian refineries serve as case studies, with technological solutions adapted to their complexity levels. The methodology involves evaluating different options for hydrogen production, accounting for improvement in technological efficiency over time.

The refinery systems were evaluated in a cost-optimization model built in Linny-r. Three different scenarios were considered, Business-As-Usual (BAU), high, and low-ambitions decarbonization scenarios, focusing on the time horizons of 2030 and 2050.

When comparing the two case studies, the preferred decarbonization strategy for both facilities involves the substitution of SMR technology with water electrolyzers powered by renewable electricity. Post-2030, biomass-based hydrogen technology is still a costly alternative; however, to achieve CO₂ neutrality, negative emissions storage of biogenic CO₂ emerges as an achievable alternative.

Our results indicate the achievability of CO₂ reduction objectives in both refineries. Our results show that achieving long-term CO₂ neutrality requires both refineries to increase renewable electricity production by 5 to 6 times for powering water electrolyzers, steam production by 2 to 2.5 times for CO₂ capture, and supply of dry biomass by 2.6 to 4.5 kt/d.

The two most significant factors influencing the refining net margin in the decarbonization scenarios are primarily the CO₂ and the renewable electricity prices. The short-term horizon emerges as the pivotal period, particularly within the high-ambition decarbonization scenarios. In this context, the medium complexity refinery demonstrates economic viability until a CO₂ price of 140 €/t CO₂, while the high complexity refinery endures up to 205 €/t CO₂.

The high complexity refinery is better prepared to face the challenges of decarbonization and the impacts generated on the refining margin. Compared to the BAU scenario, the high complexity refinery shows a negative impact on the net margin that corresponds to a 40 % and 5 % reduction in the short and long term, respectively. Meanwhile, for the medium complexity refinery, the impact on net margin amounts to a 52 % reduction in the short term and a 27 % improvement in the long term.

Furthermore, our research highlights the significant potential for reducing CO₂ emissions by fully eliminating the use of refinery gas as fuel, providing alternative applications for it beyond combustion.