Scotland's e-methanol production and decarbonisation ambitions

Today’s high demand for e-methanol is strongly driven by tight CO2 reduction goals around the world. Relatedly, efforts to phase out fossil fuels have added to the increase in e-methanol demand.

This project’s focus during the first phase will be on the maritime and shipping industry, as well as the conversion of e-methanol into e-fuels by HyLion’s network partner, P1 Fuels.

Scotland has an established energy transition industry that’s focused on moving away from oil and gas. Tellingly, the nation gave the world its first floating offshore wind farm in 2017. 

A significant part of Europe’s wind energy potential exists on Scotland’s coasts. This potential can be effectively harnessed to produce green hydrogen, which, when combined with biogenic CO2, can be converted into e-methanol. The resulting e-methanol will contribute to the decarbonisation strategy of energy-intensive sectors, such as shipping and aviation, and their supply chains.

Project details

Green hydrogen will be produced by the project in Scotland, using wind energy. It will then be combined with biogenic CO2 from the local whisky trade and a nearby biomass power plant, before being converted into e-methanol. 

The hydrogen and e-methanol can either be fuelled at a Scottish port, be delivered to mainland Europe or used to produce e-fuels for domestic application. It can also be used as a European export.

The first signed letters of intent cover twice the pilot production volume, dependant on the final price of e-methanol and funding required.

Because of all this, and due to high customer demand, the project aims to scale production quickly. The project has forecast, that from a technological perspective, a scale-up of up to 10 times the pilot production volume is possible – with the aviation industry seen as another source of potential offtakers. 

The project is expected to operate from the south of Scotland, where the e-methanol production will take place and, crucially, where energy infrastructure is available. The location is attractive for this early-demand project due to its opportunities and local support.

The capacity of modular e-methanol equipment allows the pilot to begin with 45,000 tonnes of e-methanol per annum at the beginning of 2028, using an 80-megawatt electrolyser and roughly 63,000 tonnes of biogenic CO2 per year.

It is with those figures in mind – particularly the high levels of biogenic CO2 – that the project’s forecast of up to 10 times its size was calculated.

Project partners

The HyLion project is characterised by a strong network of partners that bring technology and knowledge together along the supply chain. These partners include:

• E.ON
  
• Bosch
  
• McPhy
  
• The Carbon Removers
  
• CO2 Recovery
  
• ARUP
  
• Mareneco
  

Offtakers of the project include Cadeler and P1 Fuels.

About the opportunity

HyLion are looking for companies to be part of an early-mover hydrogen and e-methanol project, where you'll benefit from the technology and supply chain expertise of all its network partners.

In the short term, HyLion is looking for initial co-funding to cover the project development and engineering design costs until a Final Investment Decision is reached.

The project is also looking for debt funding, as well as other equity investors and partners, to cover CapEx expenditures and further shape the project’s future.

The long-term role of MHP will include:

• Continuation and detailing of concept development and business case (in close co-ordination with the industrial partners in the network and, if applicable, the investors)
• Identification and integration of further committed offtakers, technology and logistics partners and investors
• Further development of the global of hydrogen and e-methanol community from Scotland 
• Shaping development of transport scenarios which contribute to the decarbonisation of supply chains
• Project management and coordination network advisory role
• Integration of further business models, such as scaling

The Green Investment Portfolio support the UN’s Sustainable Development Goals.  The projects in the portfolio support the goals below: