Refineries in the Port of Rotterdam (PoR) account for 20% of Dutch industrial and 6% of national CO2 emissions, with high temperature heat emissions representing 70% of this total. Decarbonising these refinery operations is challenging, with the EU and Dutch CO2 reduction targets consisting of 55% reduction by 2030, 90% by 2040 and 100% by 2050.

Blue hydrogen is seen as a promising solution for decarbonising high temperature heat within refineries. However, existing studies have primarily focused on the technical and commercial feasibility from a corporate perspective, lacking a comprehensive, holistic view. This is relevant since the government is obliged to reach the decarbonisation targets. This research aimed to determine the cost and benefits of using blue hydrogen for the decarbonisation of high temperature heat within PoR refineries from the public and corporate perspective, in alignment with Dutch/EU net zero targets in 2050.

The main research question which was answered is: What are the costs and benefits of using blue hydrogen for the decarbonisation of high temperature heat generation within refineries in the Port of Rotterdam considering the Dutch/EU net zero targets in 2050, from the perspective of the corporate versus the public?

A Social Cost Benefit Analysis (SCBA) under EU guidelines was conducted, comparing a business as usual (BAU) reference case, which is not reaching the climate targets, with a blue hydrogen intervention scenario. The intervention scenario resulted in an overall CO2 reduction of 44.4 Mt between 2024 and 2050, needed to reach EU and Dutch decarbonisation targets.

After identifying all effects resulting from the intervention scenario, the cost and benefits of both perspectives could be assessed. This study finds significant differences in valuation between the corporate and public perspective. The corporate Net Present Value (NPV) is 172MEUR, while the public NPV Is 8,834 MEUR. This underscores that societal and environmental benefits are not captured in corporate metrics. This is primarily due to the undervalued Corporate CO2 EU ETS price compared to the Social Cost of Carbon. Addressing this gap may require policy measures such as increasing the EU ETS or the local Dutch CO2 Levy. Further research should assess mechanisms to align CO2 pricing with true external costs.

Given the enduring issues of human-induced climate change, the appeal of strategies aimed at reducing greenhouse gases has never been greater. CO2 is the most concerning greenhouse gas due to the large quantity already emitted into the atmosphere and the ongoing excessive emissions from anthropogenic activities. The transportation sector significantly impacts global warming, as all major transportation modes depend on fossil fuels. The principal fuel used in aviation is kerosene, which is a jet fuel derived from petroleum. Due to the environmental risks associated with petroleum-based fuels, synthetic kerosene is an appealing alternative that could aid the decarbonisation of the aviation sector. This research study aims to conduct a techno-economic analysis of synthetic kerosene, as a potential sustainable fuel for aviation. To address the excessive CO2 concentrations in the atmosphere, the process of extracting CO2 from the air, known as direct air capture, is investigated. A model is developed in Aspen Plus consisting of four main modules, namely direct air capture with NaOH sorbent and calcium looping, syngas production through the reverse water gas shift reaction, Fischer-Tropsch Synthesis and hydrocracking & distillation. There is a substantial gap in the literature concerning the utilisation of direct air capture technologies for synthetic fuel production, and this study aims to narrow this gap.

The global energy sector is a substantial contributor to greenhouse gas emissions, responsible for approximately 75% of such emissions worldwide. Indonesia, ranking twelfth in energy consumption and ninth in global carbon dioxide (CO2) emissions from fuel combustion, is faced with the challenge of addressing its significant carbon footprint. This challenge is exacerbated by a projected 3.5% annual increase in energy consumption driven by anticipated economic growth. Notably, coal accounts for half of Indonesia's electricity generation capacity, producing 31.5 exajoules (EJ) annually and emitting 3 kilotons of CO2 per kiloton of coal consumed.

Despite its role as a major coal producer, Indonesia has set ambitious targets, aiming to achieve net-zero emissions by 2060, including a 29% reduction in carbon emissions by 2030. A pivotal step towards these goals is exploring alternative energy sources, with a particular focus on the New and Renewable Energy (NRE) sector.

Traditionally used for cooking, biomass energy has expanded within Indonesia's NRE sector, with sustainable biofuel and biogas gaining prominence. Indonesia possesses a substantial biomass potential, estimated at 32.6 gigawatts (GW), offering a sustainable avenue for biomass residue utilization. One promising avenue is co-firing biomass alongside coal in existing Coal-Fired Power Plants (CFPPs). However, initial pilot projects have encountered challenges, with co-firing percentages remaining below 20%, and coal retaining dominance in the energy mix.

This report addresses a critical knowledge gap hindering the progress of biomass co-firing in Indonesia. Its primary objective is to assess the techno-economic potential of retrofitting existing CFPPs in Indonesia for biomass co-firing. The assessment encompasses identifying abundant and suitable biomass residues for co-firing, exploring retrofit scenarios based on technical considerations, conducting an economic feasibility analysis of CFPP retrofitting, and proposing policy recommendations for Indonesia's Ministry of Energy and Mineral Resources.

The study reveals that agricultural by-products account for 70% of available biomass, followed by forestry residues (17%) and Municipal Solid Waste (MSW) (13%). Notable contributors among agricultural residues include rice and palm oil residues, each exhibiting substantial potentials. Forestry residues, such as solid and sawdust residues from pulpwood and sawn wood, also hold promise.

The technical potential for co-firing is estimated at 450 terawatt-hours (TWh), equivalent to the estimated electricity demand in 2030. To achieve practical implementation, proposed CFPP retrofit scenarios consider co-firing percentages, addressing pre-treatment of biomass, boiler efficiency, and equipment modifications.

Using the Levelized Cost of Electricity (LCOE) methodology, the economic assessment yields a range of outcomes, from 2.2 to 10 cents per kilowatt-hour ($c/kWh), based on distinct case studies. The report highlights the economic feasibility of biomass co-firing in Indonesia, even when compared to sub-critical/ultra sub-critical coal plants.

To support biomass co-firing, the report recommends policies such as a significant carbon tax, redirecting coal subsidies, and promoting biomass utilization to support biomass co-firing. Improving the supply chain by identifying biomass sources near coal mines and enhancing transportation infrastructure is also essential for ensuring a stable biomass supply. Despite some limitations in data sources and modeling, the study employs dynamic approaches to present result ranges and diverse scenarios, enhancing the validity of its findings.

In summary, the strategic implementation of recommended measures has the potential to significantly contribute to Indonesia's transition towards sustainable biomass co-firing practices in its energy sector, aligning with its emissions reduction and net-zero goals.