Documente Academic
Documente Profesional
Documente Cultură
Techno-economic assessment of
biogas to liquid fuels conversion
technology via Fischer-Tropsch
synthesis
Ikenna J. Okeke, Sudhagar Mani, University of Georgia, Athens, GA, USA
Received August 14, 2016; revised December 14, 2016; accepted January 10, 2017
View online at February 23, 2017 Wiley Online Library (wileyonlinelibrary.com);
DOI: 10.1002/bbb.1758; Biofuels, Bioprod. Bioref. 11:472487 (2017)
Abstract: Biogas derived from anaerobic digestion of organic wastes, and lignocellulosic biomass
can be used to produce drop-in diesel fuel via Fischer-Tropsch (FT) synthesis. In this study, we
developed a process-based simulation model for the biogas to liquid fuel (BgTL) plant to conduct
mass and energy balances and to evaluate techno-economic assessment of producing drop-in FT
fuels. The BgTL plant operations consisted of biogas cleaning, biomethane reforming, FT synthesis
of syngas and hydrocracking and final distillation to produce drop-in liquid fuels. The unconverted
syngas and syncrude were utilized to generate steam and electricity to meet internal plant demand,
while the excess power was sold to the grid. The base case BgTL plant (2 000 Nm3/h) produced about
4.6 million gallons per annum of total FT fuels which consisted of 62% diesel, 32% gasoline, 6% LPG
with an overall biogas conversion of 54%. A discounted cash flow rate of return (DCFOROR) approach
for the Nth plant was used to estimate the capital and operating costs with the minimum selling price
for the FT drop-in fuels of about $5.67/gal ($5.29/GGE). The increase in plant feed capacity to 20
000 Nm3/h decreased the minimum selling price to $2.06/gal ($1.92/GGE). The sensitivity analysis
conducted on the base case plant demonstrated that the internal rate of return (IRR), FT conversion
rate, plant operating hours, and biogas cost were the most sensitivity parameters to the minimum
selling price. Overall, the BgTL technology is deemed to be economically feasible to meet US biofuels
demand. 2017 Society of Chemical Industry and John Wiley & Sons, Ltd
Keywords: biomethane; plant simulation; syngas; drop-in liquid fuel; biogas cost
Correspondence to: Sudhagar Mani, BioChemical Engineering, College of Engineering, University of Georgia, Athens, GA 30602, USA.
E-mail: smani@engr.uga.edu
472 2017 Society of Chemical Industry and John Wiley & Sons, Ltd
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 473
I Okeke, S Mani Modeling and Analysis: Cost of producing liquid biofuels from biogas
The gas-to-liquid (GTL) and coal-to-liquid (CTL) process Biogas produced from AD of lignocellulosic biomass
technologies are well-established liquid fuels production can be converted to drop-in liquid fuels. The anaerobic
processes operated by different companies such as Sasol, digestion plants can be strategically located as depots
Shell, Syntroleum, and ExxonMobil in various parts of the (intermittent processing facility) with a plant capacity of
world. Exploring various GTL plants, Greene17 reported 50200 dry tonne/day. The biogas from AD depot can be
that the plant capacity and capital investments were criti- fed to BgTL plant to produce renewable diesel and gasoline
cal in estimating the project profitability. Similar to the derived from lignocellulosic biomass. Also, the feedstock
GTL and CTL, thermochemical conversion of biomass to quality specifications for AD plants are less stringent than
liquid fuels production has gained tremendous attention that of biomass gasification26 or biochemical conversion
in the recent years. The pathways such as biomass-to-liq- routes to produce liquid fuels. The work by Tijmensen et
uid (BTL), biomass-to-butanol (BTB), biomass-to-ethanol al.19 estimated that the preprocessing cost contributed the
(BTE), and biomass-to-methanol (BTM) fuels processes highest installed cost (21%) of a biofuel plant compared to
have been studied recently as possible commercial routes other major operations. In addition to a high gasifier cost,
to produce liquid biofuels.18-23 A techno-economic the presence of contaminants such as particulates, tars,
assessment (TEA) study on natural-gas-to-liquid (GTL) alkali compounds19 in the biomass-gasified syngas nega-
fuels plant conducted by Betchel,18 reported that 44 940 tively affect the downstream process and poisons the cata-
barrels/d (BPD) of liquid fuels could be produced from 412 lysts27 if not removed. Boerrigter et al.28 reported that the
MMSCF/day of natural gas with a total capital investment technology in achieving biomass-gasified syngas cleaning
of $1842.5 million (1993 US$). Williams et al.22 conducted and conditioning operations pose significant challenges
a TEA of a 3000 tonne/day biomass to methanol plant in the liquid fuels production pathway along with high
estimated a methanol selling price of $12/GJ ($1.42/GGE) installed cost.20,21,29 Contrary to the challenges associated
for a 1995 US$ cost year. Similarly, a techno-economic with the biomass gasification route, the biogas reform-
analysis performed by Phillips,24 for ethanol produc- ing route could be less capital intensive due to the high
tion from hybrid poplar wood with a feed plant capacity purity level of biomethane. Although the biomass gasifica-
of 2000 tonne/day estimated a minimum selling price of tion route is relatively expensive, the rate of conversion
$1.01/gal ($1.49/GGE). Tijmensen et al.19 estimated a mini- of biomass to syngas up to 72%21 is high when compared
mum selling price of $9/GJ of FT fuels from an 80 tonne/h with biomass to biogas with a maximum conversion of
(1741 tonne/day) poplar wood plant worth $380 million 30% before its subsequent reforming to syngas. This high
(1999 US$) in capital investment. The cost analysis of 1327 conversion to syngas achieved via biomass gasification
tonne/yr of switchgrass biomass to FT fuels (gasoline and route presents a trade-off between relatively large invest-
diesel) studied by Larson et al.20 produced 3897 BPD of ment cost and conversion. Nevertheless, given the proven
FT fuels with a capital investment of $541 million (2003 technology in converting solid organic matter either as
US$) which was discounted to attain a plant gate fuel cost a standalone feed or in an integrated anaerobic digester
of $15.25/GJ. In 2010, the National Renewable Energy (iAD), biogas production challenges have been consider-
Laboratory (NREL) reported an economic-study of a 2 000 ably addressed.
tonne/day corn- stover to FT fuels plant and estimated a Therefore, the main objectives of this paper were to
product value of $4.80/GGE and $4.30/GGE, respectively, develop a process simulation model to produce drop-in-
in low- and high-temperature scenarios with a total capi- liquid fuels from biogas via F-T synthesis and to conduct a
tal investment (TCI) of $498 million and $606 million detailed techno-economic assessment of BgTL fuels tech-
(2007 US$), respectively.21 Finally, Okoli et al.25 carried nology to estimate capital investment, operating cost and
out an economic study of butanol liquid fuel production minimum selling price of biofuels.
from a 75 tonne/h pine woody biomass plant with a TCI of
$357 million (2012 US$) and a minimum butanol selling
price of $0.83/L ($3.14/gal). While these biomass conver-
Methodology
sion routes are promising for liquid fuels production, the
techno-economic feasibility of BgTL fuels production Process description
route and the interrelationship between the plant size and A baseline BgTL fuels production technology via FT
capital investment was deemed vital to be explored as synthesis (Figure 1) was developed with a biogas pro-
there is no published work in these areas to the knowledge cessing capacity of 2 000 Nm3/h that could be received
of the authors. from a single, large-scale anaerobic digestion plant.6
474 2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
Raw biogas from an anaerobic digestion plant consists Process design and simulation
mainly of CH4, and CO2 , and trace amounts of H2S, N2 ,
O2 and saturated water vapors and serves as a feedstock Each process in the BgTL plant was simulated with the
for producing drop-in diesel fuel. The presence of trace optimal operating conditions using industry data and
gases and carbon dioxide should be removed or stripped relevant literature sources using an Aspen Plus simula-
to enhance downstream conversion process. In this study, tion software. The raw biogas composition was defined
the biogas upgrading section was simulated to remove the based on various literature sources as shown in Table
impurities (CO2 and H2S) present in the biogas stream.27 1. The raw biogas also consists of sediments and dust
It employed the commercial high-pressure water scrub- particles that should be separated using a settling tank
bing process30,31 which produces biomethane with 97% upstream to the upgrading process. 33 Two isentropic
methane composition. The biomethane (cleaned biogas) compressors were designed to operate at 2 and 8 bars,
product was sent to the syngas production area where two respectively, to satisfy the pressure demands on the
reforming processes (steam and partial oxidation reform- system. And each of the compressor outlets was con-
ing) were employed to attain the desired syngas ratio 18 nected to Tubular Exchanger Manufactures Association
and maintain an energy efficient syngas production.32 So, (TEMA) coolers (20 oC) so as to control the temperature
the biomethane stream was split and sent to the steam of the process. The raw biogas exiting the settling tank
and partial oxidation reforming processes that produced was then passed through the series of compressors and
syngas of different compositions. Mixing the syngas coolers to achieve the absorber packed tower operating
streams from the respective reformers helped to achieve conditions at 20 oC and 8 bar. 30 The absorber and strip-
desired hydrogen to carbon monoxide ratio (H2/CO) of ping columns are counter-current columns designed
two. The conditioned syngas was cooled to remove excess and filled with a plastic, INTALOX structured packed
water in the syngas before it was sent to the FT synthesis bed that would enhance mass transfer during the vapor-
process. Catalytic conversion of syngas occurred at a low- liquid interaction. The plastic INTALOX packing was
temperature slurry phase reactor in the presence of cobalt chosen as it is resistant to corrosion, has minimum liq-
catalyst 27 to yield FT syncrude with high selectivity for uid hold-up and causes lower pressure drop compared
the heavy chain fractions due to the probability of chain to other packing materials. 34 Non-random two-liquid
growth model used in this study. The FT syncrude was (NRTL) database with Henrys constant was used as the
subjected to product upgrading to obtain different fuel activity coefficient for the property method calculations.
fractions. Hydrocracking, hydrotreating, distillation, and The solubility of biogas mixtures in water that occurred
separation were the major upgrading operations employed in the absorption column was estimated by Henrys law
to produce the desired fi nal products of drop-in fuel frac- to simulate the biogas upgrading section of the plant.
tions: LPG, gasoline, and diesel. Process steam was gen- The loss of methane during the upgrading process was
erated from the recovered heat produced by exothermic minimized by dropping the pressure of the solute-rich
reactions in certain processes. The unconverted methane water stream to 2 bar in the flash drum before the
and syngas were combusted to produce electricity through recycling and stripping operations. 30 The top product
a combined cycle (gas and steam turbine) to meet internal of the flash drum containing some methane was sent
electricity demand, and the excess power was sold to the back to the absorber column through the compressors
grid. and coolers, while the bottom product containing the
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 475
I Okeke, S Mani Modeling and Analysis: Cost of producing liquid biofuels from biogas
476 2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
Table 2. Different process reactions. block using equation 6 that yields the FT syncrude
products.
Processes Reaction Reference
36
The FT syncrude predominantly consists of long chain
Steam CH4 + H2O CO + 3H2 paraffi ns, olefins, and oxygenates42 as shown in Table 2.
Reforming CO + H2O CO2 + H2
The FT liquid fuels have to be refined as similar to crude
CH4 + 2H2O CO2 + 4H2
38
oil product to produce drop-in fuel fractions. Initially,
Partial CH4 + 0.5O2 CO + 2H2
Oxidation
the light gas in the syncrude was separated in high-
46, 47 pressure hydrocarbon recovery unit which was collected
Fischer- nCO + (2n+1)H2 CnH2n+2 + nH2O
as the LPG (C3) fractions, while the heavy hydrocarbons
Tropsch nCO + 2nH2 Cn H2n + nH2O
synthesis nCO + 2nH2 Cn H2n+1OH + (n-1) H2O of wax, distillates and naphtha were further processed.
Hydrocracking of the wax fractions occurred at 380oC and
50 bar48 in the presence of a platinum catalyst with a liq-
was recycled to achieve an overall syngas conversion of uid hourly-space velocity (LHSV) of 1.1 hr1. 49 The distil-
80% in the slurry reactor as reported by Tijmensen et al.19 late and naphtha fractions were selectively hydrotreated in
The reaction rate for the formation of the syncrude was a distillate and naphtha hydrotreaters18 on a CoMo/Al2O3
proportional to the weight of a catalyst which is a func- catalyst with an LHSV of 1.2 hr1. 50 Distillate hydrotreat-
tion of the GHSV.41 The catalyst consumption rate per m3 ing specifically improved the diesel fraction cetane num-
of syngas processed was determined using the GHSV of ber, while naphtha hydrotreating saturated the olefins51
2.38 m3/hr.kgcatalyst reported by Fox et al.41 Although the for higher paraffi n formation (gasoline fuels). The different
use of cobalt catalyst promotes the formation of diesel drop-in fuel fractions of gasoline and diesel were obtained
fractions, it also eliminates the formation of water-gas by distillation using the principle of the relative volatility
shift reaction.42,44 Since the FT process is an exothermic of the hydrocarbons with some wax (C30) fractions recov-
process, the heat integration approach was employed to ered as heavy bottom products and sold as a co-product.
maximize energy recovery which was used in the entire The Underwood equation of the DSTWU block was
process thus ensuring high energy efficiency. The length employed to achieve product slits by initially performing
of hydrocarbon product formed during FT synthesis is an iteration to determine the minimum reflux ratio (R min).
dependent on the alpha chain growth probability model Hence, the actual reflux ratio was obtained using the cor-
predicted byAnderson-Schulz-Flory mechanism43 relation (1.5*R min)52 which was used to calculate the actual
according to Eqn(6). number of stages in the column.
The unconverted syngas from the FT process was used
Wn = n(1)2 n1 (6) as a fuel gas for electricity generation. A combined cycle
approach was employed to utilize the flue gas heat effi-
where ciently in a heat recovery steam generator (HRSG). For
Wn = mass fraction of product with n carbon atoms, optimal energy usage, the fuel gas was subjected to a lay-
n = number of carbon atoms, = probability of chain down system operating at 8 bar which utilizes the internal
growth, (1) = probability of chain termination. energy of the fuel gas to produce electricity before it was
A basic Fortran expression was written in Aspen Plus combusted in a burner in the presence of excess air and
that estimates the ASF value based on the syngas feed steam. Air with 20% excess oxygen served as an ignition
parameters and reactor operating conditions using the medium in the burner which was calculated from the stoi-
alpha correlation parameter developed by Song et al.,45 as chiometric air-fuel ratio using the Aspen Plus calculator
shown in Eqn (7). block. Steam was used as a thermal NOx control medium
and was varied according to Chiesa et al.53 to reduce the
= [0. 2332 + 0. 663 ] [1 0. 0039 533 )] (7)
2 amount of NOx in the exhaust gas. The hot gas was fed to
where the gas turbine to generate electricity while the hot flue gas
ASF = Anderson-Schulz-Flory alpha distribution, yco= heat was recovered in an HRSG for steam and additional
mole fraction of carbon monoxide in syngas, yH2 = mole power generation in a steam turbine. The rate of water cir-
fraction of hydrogen in syngas, T = Temperature of F-T culation for the Rankine cycle depended on the amount of
slurry phase reactor. heat recovered from the flue gas by the HRSG which was
The estimated ASF variable solves the Fortran product calculated using the Aspen calculator block. The operating
distribution expressions developed in Aspen calculator conditions of the key unit operations are given in Table 3.
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 477
I Okeke, S Mani Modeling and Analysis: Cost of producing liquid biofuels from biogas
478 2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
The BgTL plant simulated in Aspen Plus was used to Table 4. Total capital investment approach.
conduct the mass and energy balances for the base case
Estimate Approach
BgTL (2 000 Nm3/h) plant. The mass and energy balance
Base Equipment Cost (BEC) Aspen Process Economic Analyzer
data was used to carry out the techno-economic assess-
ment of the BgTL plant. For subsequent evaluation of Direct Equipment Cost (DEC) Aspen Process Economic Analyzer
the effect of plant capacity on the overall project cost, we Balance of Plant (BOP) 12% of BOE
employed the design specification of the base case model Total Direct Equipment Cost DEC + BOP
to develop three additional models of different feed capac- (TDEC)
ity: 500, 10 000, and 20 000 Nm3/h. These four BgTL Indirect Equipment Cost 89% of TDEC
models were used in evaluating the potential of biogas as a (IEC)*
future drop-in fuels route for conversion to liquid fuels via Total Plant Cost (TPC) TDEC + IEC
FT synthesis. Contingency fee 20.4% of TPC
Fixed Capital Investment TPC + Contingency
Techno-economic assessment Working capital 15% of FCI
Land 8% of BEC
TEA of BgTL was performed using Aspen Process
Economic Analyzer (APEA) v8.8 on a 2014 US$ pric- Total capital Investment (TCI) FCI + WC + Land
ing basis. The sizing of the unit operation was carried ISBL Section (A-D)
out using the Icarus cost estimator and mapped to the OSBL Section (E-F)
appropriate equipment in APEA to obtain the base * (32% Engineering and supervision, 23% Contractors and leg-
equipment cost (fob) and installed cost. All estimated acy fees, and 34% Construction expenses)
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 479
I Okeke, S Mani Modeling and Analysis: Cost of producing liquid biofuels from biogas
fee, working capital, and income tax) and process specific Table 6. BgTL product distribution and energy
(FT conversion, feedstock, oxygen, and catalyst costs, co- usage from 2 000 Nm3/h base case plant.
products price: electricity and wax) input data. They were Drop-in fuels Quantity
varied to ascertain how the price of the fuels were affected.
LPG 0.309 million gallons/yr
A 20% increase or decrease on each of the parameter while
Gasoline 1.331 million gallons/yr
keeping other parameters constant was implemented.
Diesel 3.014 million gallons/yr
The catalyst lifetime of 3 years was varied between 1 and
5 years assuming a worst case and advanced catalyst per- Co-products
formance scenarios, respectively. Similarly, biogas price Wax 233 896 kg/yr
was varied between $2/GJ and $6/GJ to mimic the differ- Electricity 1 015 kWh
ence in the purchase price of biogas due to feedstock cost
variations. In general, sensitivity analysis paves an avenue
Table 7. Electricity and heat requirement in kWh.
for process optimization which ensures that the objective
function (selling price of FT fuels) is minimized to facili- BgTL plant sections Electricity Process heat
consumption
tate drop-in fuels from biogas become competitive.
Biogas upgrading 398.72 300.09
Syngas production 166.39 -891.13
Results and discussion Fischer-Tropsch synthesis 55.78 6656.77
Product upgrade 179.25
Process design and simulation Power generation -1014.89 -2971.17
A base-case process model for a BgTL fuel plant was suc-
cessfully developed and the overall product distribution
The recovered energy was used within the process to
and energy data were presented in Table 6. The process
account for proper energy efficiency. Syngas production
analysis of converting 2 000 Nm3/h (2381 kg/h) of raw
and FT synthesis operations were the other major con-
biogas produced 4.65 million gallons per year of liquid
sumers of electricity. Net heat utilization in the syncrude
LPG, gasoline and diesel fractions (Table 6). The amount
upgrade from the reboiler and condenser was partially
of liquid fuels produced from raw biogas showed a 54%
used to offset the energy demand of the other processes.
(mass basis) of overall product yield which is comparable
Furthermore, the exothermic reaction of the FT process
to a typical GTL yield of 4060% 17 and 63% for natural
generated the highest amount of heat which was used to
gas to liquid fuels yield by Bechtel.18 However, this yield
satisfy the internal heat demand of the process. Overall,
value for the BgTL process differs from the liquid fuels
efficient heat utilization in the entire system was achieved
production by biomass gasification works of Larson et al.20
and the amount of electricity required in this process was
and Swanson et al.21 Both authors reported a product yield
met from the internally generated power plant (excess
of less than 20% (mass basis) due to a huge loss encoun-
sold) with an overall thermal power efficiency of 36%.
tered during the reforming and conditioning of syngas
obtained from biomass gasification. The electricity [co-
Techno-economic analysis
product] obtained in this work depended on the extent of
conversion in the slurry reactor. Total energy consumption The base-case BgTL plant (2000 Nm3/h feed capacity)
in the entire process with regards to heat and electricity is produced about 4.65 million gallons/yr of FT drop-in
summarized in Table 6. fuels with a capital expenditure (CAPEX) and operating
Table 7 shows the heat and power demand for the BgTL expenditure (OPEX) of $96.52 million and $11.45 million
plant. Biogas upgrading was the highest consumer (64%) (2015 US$) respectively. A discounted cash flow rate of
of electricity due to a series of compressors and pumps return (DCFROR) analysis on the base case plant esti-
installed to achieve the process design operating condi- mated an FT fuel MSP of $5.29 per gasoline gallon equiva-
tion. The total power consumption of 0.2 kWh/Nm3 of was lent (GGE). A summary of equipment installed costs for
consumed to upgrade biogas and was within the range of each section of the process classified as the inside battery
0.2 to 0.3 kWh/Nm3 of biogas reported by Bauer et al.65 limit (ISBL) is shown in Fig. 2. The syngas production sec-
For the given amount of electrical energy consumed, about tion contributed 41% of the total equipment cost which is
75% of heat was recovered in the TEMA coolers similar to typically the highest cost in all GTL process as reported
the HPWS electrical power recovery achieved by Dirkse.30 by Spath et el.27 Syncrude upgrade and power generation
480 2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
8%
13%
Biogas Cleaning
Syngas Production
Product Upgrade
Power Generation
8%
contributed 30% and 13%, respectively, while the FT syn- 100% 100%
Maintenance Working
thesis and biogas cleaning sections contributed to each 8% 90% & Insurance 90% Capital
Labor
of the ISBL cost. 80% 80%
Percent contribution
The breakdown cost distribution of overall CAPEX and Oxygen Land
Percent contribution
70% 70%
OPEX is depicted in Fig. 3. It can be observed that the 60% Waste 60%
equipment cost contributed to 49% of the fi xed capital 50%
Disposal
50% Contingency
Catalyst
investment and is usually the highest capital investment in 40% 40% fee
a typical chemical process. The engineering and construc- 30%
Electricity
30%
tion and contingency fee contributed to 22% and 14%, Process 20%
Const,
20% Engr,
respectively, as the former generally represents a huge per- Water
Superv &
10% Feedstock 10%
centage of the plant investment catering for the detailed legal fees
0% 0%
engineering on the construction site while the latter is OPEX CAPEX
a function of the total plant cost normally set aside for
mark-up. Working capital and land contributed the rest of Figure 3. Individual costs contribution to OPEX and CAPEX.
the capital investment with each contributing 13% and 2%,
respectively. Advancement in technological development is (16%). Other consumables such as catalyst, oxygen, elec-
vital, as it would enhance the technical know-how needed tricity, waste disposal, and process water costs contributed
in the design and fabrication of the equipment used in this to 8%, 4%, 4%, 2%, and 1%, respectively. The inherently
process, thereby promoting competition amongst dealers cheap feedstock cost highlights the prospects for the use
and a resultant reduction in the investment cost tied to of biogas as feedstock in the BgTL process. However, the
equipment procurement. Such achievement would invari- increased feedstock demand or competition for other bio-
ably reduce the other costs (engineering, construction, mass conversion technologies would increase the biogas
supervision, land, working capital, etc.) that are estimated production cost.
from the base equipment cost. For the operating cost, We evaluated the effect of plant capacity on the CAPEX,
the fi xed operating cost usually accounts for the highest OPEX, MSP, and production capacity to ascertain the
expenses. Plant operation at full capacity is necessary to actual prospects of the BgTL process. Four biogas plant
offset these costs from product profit. Labor and main- scenarios: 500Nm3/h, 2000 Nm3/h (base case), 10 000
tenance costs contributed to 39% and 26% of the total Nm3/h, and 20 000 Nm3/h were considered with their
operating cost, respectively, followed by the feedstock cost relations shown in Fig. 4. Capital and operating costs for
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 481
I Okeke, S Mani Modeling and Analysis: Cost of producing liquid biofuels from biogas
the 500 Nm3/h biogas plant had the least investment com- depicted in the selling price of fuel ($/gal) as a function of
pared with that of other plant sizes. Although the capital the production capacity. It is clear that operating the plant
and operating cost of $332.16 million and $42.72 million at a feed capacity of 500Nm3/h and 2 000Nm3/h is not eco-
per year respectively were invested in running the 20 000 nomically feasible, as the cost per production is high com-
Nm3/h capacity plant, economies of scale emanating from pared with that of 10 000 Nm3/h and 20 000 Nm3/h plant.
production capacity compensate for the large investment. The minimum selling price of drop-in fuels at a plant
Figure 5 shows the unit production cost of CAPEX capacity of 500Nm3/h was about $13.51/gal, which is
and OPEX with the increase in plant feed capacity. The clearly not feasible based on the market price. For the
increase in plant feed capacity decreased the unit cost of BgTL plant with a feed capacity of 20 000 Nm3/h, the MSP
CAPEX and OPEX ($/gal) as more product is manufac- was about $2.06/gal, which is economically feasible and
tured which offsets the investment and operating costs. competitive with the current energy market while meeting
It is noteworthy to observe that the trend was not linear the renewable hydrocarbon fuel price target of $3 per gaso-
since the costs do not double or quadruple when the plant line gallon equivalent (GGE).66 However, supply of large
capacity was increased by similar magnitude due to the volumes of low cost biogas near the BgTL plant could be
economies of scale and the synergistic effect on labor cost. challenging due to the variation in feedstock cost, quality,
Figure 6 confirms the synergy of an economy of scale as operating conditions (microbial activity and C/N ratio),
and other independent factors (plant location, climate,
350
332.16 seasonal variations, etc.).67
300
14
13.51
250
12
Minimum Selling Price ($/gal)
209.89
200 10
MM$
CAPEX (MM$)
150 8
OPEX (MM$/yr)
6 5.67
100 96.52
4
58.16 42.72 2.54
50 2.06
26.74 2
6.71 11.45
0 0
0 5,000 10,000 15,000 20,000 0 5,000 10,000 15,000 20,000
Plant Size (Nm3/h) Plant Size (Nm3/h)
Figure 4. OPEX and CAPEX as a function of plant capacity. Figure 6. Product selling price as a function of plant capacity.
$60
$56
$50
Investment Cost ($/gal)
$40
$50
$30
$23
$20
$21 $8
$10
$10 $6
$2 $9 $7
$1.15 $0.92
$0
0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000
Plant Size (Nm3/h)
482 2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
B
IRR, % (8, 10, 12) 5.13 6.24
Figure 7. Sensitivity analysis for the effects of process (A) and cost (B) parameters on the
minimum selling price FT fuels.
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 483
I Okeke, S Mani Modeling and Analysis: Cost of producing liquid biofuels from biogas
Table 8. Comparison of the techno-economic analysis of BgTL and other related processes
BgTL Bechtel,18 Tijmensen Hamelinck Larson et al. 20 Swason et al.21 Bao et al.68
Model et al.19 et al.40
Feedstock Biogas Natural Gas Poplar Wood Switchgrass Corn Stover Natural Gas
Feedstock cost ($/tonne) 4 ($/GJ) N/A 33 38 46 75 44a
Plant size (dry tonne/day) 57 8 391 1 741 400MWth 4 536 2 000 21 600
Product FT FT liquids FT liquids FT diesel Diesel, gasoline FT liquids Synfuels
liquids
Cost year 2015 1993 2000 2002 2003 2007 2010
Capital investment (million $) $96.5 $1842.5 $339 $303.5 $541b $610c $10,800
Product value ($/GGE) $5.29 N/A $2.00 $1.92 $1.85 $4.30 $1.41d
Product value ($/GGE) 2015 $5.29 N/A $2.86 $2.73 $2.59 $4.61 $1.44d
Note:
a = calculated based on $8/1 000 SCF natural gas price with a density of 0.8 kg/m3
b = without spare scenario
c = high temperature scenario
d = reported in $/bbl which was converted to $/gal
for the air separation unit (ASU). It can be observed that routes for liquid fuels production with limited or no
the oxygen cost of $90/tonne did not have a significant detailed economic analysis data available in the literature.
impact on the FT fuel price. Co-products such as electric- The GTL process analysis by Bechtel,18 provided no selling
ity and wax obtained from the plant played a vital role in price of the FT products while Bao et al.68 reported a least
minimizing the selling price of the fuel with co-product selling price of $58/bbl (2010 US$). A techno-economic
credits. It can be observed that a reduction in the co- assessment of converting different types of biomass have
product selling price negatively affected the selling price, been conducted by several researchers reported a product
as more money was needed from the sale of the liquid fuels value range of $2.864.61/GGE.19-21, 40 The GTL fuels price
to maintain cash flow. Therefore, the design of the process proves to be competitive, whereas the thermochemical
to produce high-value co-products usually aids the project route seemed to be slightly higher when compared with
profitability. Overall, this is an arduous task of process the fuel price ($5.29/GGE) of our base case model. At a
engineers to design and develop an efficient and optimal plant capacity of 20 000Nm3/h, the fuel value was esti-
system that can help attain the desired profit from a given mated to be $1.92/GGE which offers a better prospect for
investment. the liquid fuels production from biogas.
The IRR conventionally employed in assessing the profit-
ability of a project proved to have a significant effect on Conclusions
the selling price. For every project, the IRR measures the
extent of risk involved in the investment where company The production of drop-in biofuel from biogas via FT syn-
managers and/or investors tend to make the critical deci- thesis was successfully simulated using Aspen Plus simula-
sion. Tax rate, which included the federal and State taxes, tion platform to conduct the techno-economic assessment.
directly influenced the overall project as it is a direct For the base case plant capacity of 2 000 Nm3/h, the mini-
function of the profit. Since the State taxes differ in the mum selling price of FT fuels was about $5.67/gal ($5.29/
USA, the overall tax rate varies depending on the State GGE) with an annual plant capacity of 4.6 million gal/yr.
where the plant is located. The budget for contingency fee This selling price for a biofuel is not very competitive judg-
accounting during a project can be open ended as differ- ing from the $3/gal target set by the EPAs RFS. Given the
ent percentages of the fi xed capital investment have been current drop in crude oil price, the economic feasibility of
used. The variations in the capital investment and oper- a BgTL plant could be challenging. Nevertheless, a further
ating costs have been explored to highlight the level of drop in fuel price could be achieved at a higher plant size
uncertainty. with a selling price of $2.37/GGE for 10 000 Nm3/h plants
Table 8 summarizes the techno-economic analysis of FT and $1.92/GGE for the 20 000Nm3/h plant. Therefore, a
liquid fuels from natural gas and biomass sources from BgTL plant has a potential for rapid commercialization and
the literatures. GTL and CTL have been the commercial could compete with fossil-based liquid fuels in the USA.
484 2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb
Modeling and Analysis: Cost of producing liquid biofuels from biogas I Okeke, S Mani
2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 485
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2017 Society of Chemical Industry and John Wiley & Sons, Ltd | Biofuels, Bioprod. Bioref. 11:472487 (2017); DOI: 10.1002/bbb 487