Shell’s target is to become a net-zero emissions energy business by 2050 -or sooner-, in step with society’s progress in achieving the goal of the UN Paris Agreement on climate change. With this target, Shell will contribute to a net-zero world, where society stops adding to the total amount of greenhouse gases (GHGs) in the atmosphere. Becoming a net-zero emissions energy business means that Shell is reducing emissions from its operations and from the fuels and other energy products it sells to its customers. It also means capturing and storing any remaining emissions using technology or balancing them with offsets. The company is transforming its business to meet this target, providing more low-carbon energy such as charging for electric vehicles, hydrogen and electricity generated by solar and wind power. Shell is also working with its customers as they make changes too, including in sectors that are difficult to decarbonise such as aviation, shipping, road freight and industry.
With the world’s population expected to increase by a billion by 2030, gas is one of the few energy sources that can meet growing demand while reducing greenhouse gas emissions when used in place of coal or diesel. Air quality is also improved when natural gas is used in place of coal or diesel. Gas will continue to play a critical role in difficult to electrify sectors such as the production of steel, cement and chemicals, as well as long-distance transportation. Greenhouse gas emissions from natural gas are lower than coal in electricity generation up to a methane leakage rate of 3.5 per cent when measured over 20 years. This jumps to 7.5 per cent over 100 years. Shell sees bio-LNG as a key part of its wider work to provide a range of energy choices for its customers, to improve its own sustainability as a business and to contribute towards the energy transition. To help step up the pace of change, in October 2021, Shell set a target to reduce absolute emissions by 50 per cent by 2030, compared to 2016 levels.
CEENERGYNEWS spoke with Christian Hoellinger, Shell’s Head of Business Development Europe – Downstream LNG Road about the role of bio-LNG in decarbonising Europe’s heavy-duty road transport and the part that the CEE region can play in it.
The long haul heavy-duty road trucks, similar to aviation and maritime industries are energy-intensive, requiring a high-density fuel for use. Bio-LNG is an opportunity for the sector and its LNG-ready vehicle fleet specifically. But to what extent can bio-LNG reduce the carbon footprint of the road shipping transport and is it realistic that there are enough bio-materials for this renewable gas to be produced or used at a mass scale throughout Europe?
According to Christian Hoellinger, shifting Europe’s heavy-duty road transport sector to bio-LNG is both feasible and effective in slashing GHG emissions.
“We got 85 per cent CO2 reduction but of course, we don’t stop here”, he tells CEENERGYNEWS, speaking about the recent pilot project in Germany where bio-LNG was used by heavy-duty trucks of big shippers like DHL, Volkswagen group, Edeka and OEMs. The intention was to test the level of carbon reduction along the full value chain, from production to usage. Mr Hoellinger emphasises that despite the impressive result Shell got from the trial project, its goal is to achieve 100 per cent or net-zero emission.
As for the sufficiency of bio-materials for the entire EU, he underlines that “100 million tons of biomass are available per annum […], for the whole European road transport you only need 8 million tonnes per annum (MTPA). So 100 vs 8 means that there is enough available. Also, using the right feedstock is important because we don’t want to take food for bio-fuel production. We only need the biomass […] which means that what we take is residues, organic waste and manure.”
As promising as the potential and the availability of raw materials are, for bio-LNG to become accessible for heavy-duty road transport, the right infrastructure is needed, ranging from trucks with gas engines to LNG fuelling sites. Since the liquified gas accommodating vehicles are already on the market and LNG filling stations exist across Europe, the ground is already laid for introducing the sector to bio-LNG.
“Iveco, Volvo and Scania are producing LNG trucks so you can buy these on the market right now”, he notes and adds, “in Europe, there are 459 [LNG] sites in operation, 41 out of these are owned and operated by Shell.”
However, bio LNG has its own unique needs. “It is very important to create infrastructure for bio-LNG”, remarks Mr Hoellinger and continues, “infrastructure for LNG is already here […] but bio-LNG is completely different”.
“You have to produce the local feedstock from manure that you get from the farmers, also organic waste which comes from supermarkets and you need these local products to digest in a big container to make biogas out of it. Then you have to clean this biogas which means you have to separate CO2 from biomethane. The separated CO2 can also be used in greenhouses to grow plants or for carbonated drinks and so on. Biomethane needs to cool down under -163 degrees Celcius for it to become liquid. After that, you can load it on the trucks and get it out to the retail sites. This is where we are investing a lot right now”.
In addition, “bio-LNG is a fuel that you can blend with fossil LNG. There is no problem with trucks and with the engine so it’s the same quality, even slightly higher quality than fossil LNG”.
Shell has commissioned a 100,000 tonnes bio LNG liquefier in Germany. According to Mr Hoellinger, the company intends to open it at the beginning of 2023 and then produce 100 million kilograms of a CO2 neutral product for German transport customers. “We can save 1 million tons of CO2”, he underscores.
While Shell’s bio LNG projects are mainly run in Germany and Netherlands at present, it turns out the Central and Eastern part of Europe has a lot to contribute to the development of Europe’s bio-LNG infrastructure.
“A lot of big international trucking companies come from Eastern Europe, from Hungary, from Poland, Czech Republic. Besides, there are a lot of transit corridors coming from Eastern Europe that go through Austria and through other countries into Western Europe. What we are looking for with the bio-LNG is the international transit corridors. From that point of view, it’s key for us to invest in Eastern European countries because transport corridors start from here”, Mr Hoellinger emphasises.
“We would like to have pan-European network coverage. For that reason, we are looking into opportunities in Hungary and the Czech Republic, including in how to produce bio-LNG there. Hungary, for instance, has a lot of agriculture, a lot of organic waste, straw, manure, etc. so it’s easier, of course, to produce bio-LNG there”.
Despite the feasibility of this renewable fuel, bio LNG is still an innovative energy technology which makes it a capital risk for those who invest in bio LNG plants. Mr Hoellinger points to the need for supportive policies and policymakers who, according to him, need to set the right frame to minimise these risks.
“It depends on policy-makers and what the European Commission decide about the sales of combustion engines refuelled with CO2 neutral products”, he concludes.
