New publication on techno-economic analysis (TEA) for power-to-X and biomass-to-X processes
TUM.PtX News |
In the context of anthropogenic climate change caused by massive greenhouse gas emissions, industrial sectors that rely mainly on fossil fuels need to be converted. Power-to-X (PtX), biomass-to-X (BtX) and hybrid power-and-biomass-to-X (PBtX) or directly electrified BtX (eBtX) processes can produce chemicals and fuels from sustainable feedstocks such as renewable electricity, biomass residues and CO2 from ambient air. Techno-economic analysis (TEA) is essential to evaluate the innovative processes, identify the best process options and provide guidance for necessary technological improvements and policy measures. The new CES publication presents a comprehensive TEA methodology specifically developed for BtX and PtX cost estimates.
The newly established TUM CESTEA (TUM Chair of Energy Systems Techno-Economic Analysis) methodology extends standard factor-based cost estimation methods by incorporating specific adjustments and assumptions that are crucial for an accurate assessment of novel energy conversion processes. The study highlights the importance of the Levelized Cost of Production (LCOP) as a key economic metric for evaluating these processes. In addition, the respective structure of the LCOP, which is made up of fixed, variable and depreciation costs, must be taken into account in the economic evaluation. The aim of the method presented is to balance the level of detail required for a sufficiently accurate cost estimate with the ability to compare different processes.
CESTEA specifically addresses the unique cost elements associated with key process components, providing a better understanding of how to estimate capital and production costs. Base-case assumptions are outlined to provide a basis for cost estimation. These assumptions relate to specific technologies along the process chain and to key economic factors specific to the processes under consideration. This includes guidelines for the handling of biomass and electricity resources, as the largest shares of variable operating costs, as well as a clear allocation of the main investment cost drivers, namely gasifier, synthesis and electrolyzer. The specific differences between the renewable and fossil production pathways can thus be taken into account and process routes can be compared in a standardized way.
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