Green methanol project planned for SA
Australian renewable energy company Vast (Vast Renewables Limited) will collaborate with global energy company Mabanaft to advance Solar Methanol 1 (SM1), a green methanol reference plant located at the Port Augusta Green Energy Hub in South Australia.
Methanol is a versatile hydrogen derivative which, if produced using renewable energy, has the potential to decarbonise several hard-to-abate industries, including shipping and aviation.
SM1 will have the capacity to produce 7500 tonnes of green methanol each year. The project’s success could unlock green fuel production in Australia, with potential for exports to Germany and other global markets.
Vast specialises in concentrated solar thermal power (CSP) energy systems, and its 30 MW/288 MWh CSP plant will supply SM1 with baseload renewable heat. Using CSP can potentially reduce green fuel production costs by up to 40%, according to a recent report by engineering group Fichtner.
The companies have signed a Joint Development Agreement (JDA) setting out how the project will be developed. Earlier in the year, they signed funding agreements for SM1 for up to AU$40 million.
Vast will receive AU$19.48 million from the Australian Renewable Energy Agency (ARENA) and Mabanaft will receive up to €12.4 million from Projektträger Jülich (PtJ) on behalf of the German Government as part of HyGATE, a collaboration between the Australian and German Governments to support real-world projects along the hydrogen supply chain.
“The JDA is a significant milestone for SM1, which has the potential to demonstrate how Vast technology can unlock low-cost green fuel production to contribute to decarbonising the global shipping and aviation industries,” said Vast CEO Craig Wood. “Vast is excited to continue our partnership with Mabanaft, and the execution of this agreement is a testament to our joint commitment to pioneer green fuel production globally.”
The JDA includes a framework agreement securing offtake rights for Mabanaft for future green fuels projects powered by Vast technology, allowing Mabanaft to supply its shipping customers seeking to decarbonise their operations.
“As a leading energy solution provider, we are committed to enabling our customers’ energy transition. And we believe that methanol, in particular, can play an important role in the shipping industry, and Mabanaft is well positioned to build supply chains to meet that growing demand,” said Philipp Kroepels, Director New Energy at Mabanaft.
Vast and Mabanaft are developing SM1 with the Solar Methanol Consortium. They are supported by Australian technology company Calix as Principal CO2 Supply Partner along with the Australian Solar Thermal Research Institute (ASTRI).
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