Hydrocarbon Processing - August 2022 - 59

Bonus Report Gas Processing & LNG Industry Spotlight
J. ELLRICH, Black & Veatch, Overland Park, Kansas
Electric drive LNG can grow with the
clean energy transition
As companies across markets set aggressive decarbonization
goals and sustainability commitments to align with
changing regulations and consumer demands for greener
energy and fuel, the liquefied natural gas (LNG) industry is
searching for ways to lower emissions.
Electric drive LNG (e-LNG) has emerged as a potential
solution to help lower carbon emissions in liquefaction plants
and, in some cases, cut costs. Familiar to the market and already
commonly used in small- and medium-scale plants, eLNG
uses electric motors to drive refrigerant compression
rather than combustion gas turbines. Of the 40 liquefaction
plants the author's company has engineered, 26 are driven by
electric motors. As early e-LNG adopters in the smaller scale
segments have seen success and longevity, larger plants are beginning
to look to electric drives for some or all operations.
E-LNG offers increasingly attractive-and in some areas,
crucial-adaptability because its use of electricity allows it
to be run by fossil fuels or renewables. This trait has led to
its popularity in an oscillating energy market, where the costs
and availability of renewable and fossil-based electricity are
constantly changing.
However, as LNG asset owners, operators and investors
increasingly eye this technology for their plants, they must
understand it is not a one-size-fits-all solution. Significant development
of clean energy and energy grid infrastructure will
be required if e-LNG is to become the new industry standard.
Growing interest in sustainability. While many dynamics
are at play in the proliferation of e-LNG, two factors stand out
as clear drivers of the upward trend in adoption: decarbonization
goals and economic benefits.
On the decarbonization side, the growing low-carbon and
carbon-neutral LNG market is causing prices to fetch a premium.
Most LNG achieves carbon-neutral status through carbon
offsets, not through direct reductions in emissions. Liquefaction
of natural gas contributes approximately 8%-10% of the
total emissions along the LNG supply chain. As global interest
in carbon-neutral LNG grows, and with end users looking to
limit their Scope 2 and 3 emissions, the industry is searching
for more direct decarbonization solutions as an alternative to
relying on carbon offsets.
In late 2021, the International Group of Liquified Natural
Gas Importers issued a framework of rules for declaring cargoes
as carbon neutral. It outlines a series of steps, including
the transparent sharing of greenhouse gas (GHG) emissions
data and concerted efforts to reduce Scope 1, 2 and 3 emissions
in LNG rather than relying on offsets, the primary method
for pursuing carbon-neutral LNG production.
The decarbonization driver is strengthened by LNG companies'
sustainability and decarbonization targets. Across
industries, carbon footprint considerations are rising to the
forefront of long-term planning; for industries already associated
with fossil fuels, these commitments are an important
aspect of maintaining a social license to operate.
The author's company published a report1
that surveyed
more than 490 leaders across 14 industries and found that 73%
of respondents have set GHG reduction goals; this jumped to
89% among companies with more than $1 B in annual revenue.
The economic considerations go both ways. Separate
from the emissions-reduction benefits of e-LNG, economic
considerations have been integral in adopting the technology.
However, these considerations go both ways-they have
also been a deciding factor in cases when the technology was
passed over in favor of gas turbines.
In some cases, e-LNG can lower liquefaction plant capital
and operating costs (CAPEX/OPEX) because the motor is
cheaper and requires less maintenance than gas turbines, resulting
in more overall onstream time across the asset's lifecycle.
This cost reduction tends to be a driver of electric motor
adoption on projects with adequate and competitively priced
available power. However, it would be inaccurate to say that
e-LNG is cheaper overall.
Since e-LNG pulls significant power from the grid-especially
in cases where a large production plant might be utilizing
this technology-there are often cases in which the
installation of electric motors requires significant upgrades
to surrounding transmission infrastructure, the installation of
a high-voltage substation, and more to ensure adequate and
stable power. This is where any cost advantage of motor drivers
will erode.
In such cases, it is often more cost-effective overall to
choose gas turbines to drive LNG compression. As cost tends
to be the deciding factor for any major infrastructure project,
e-LNG is not a blanket solution. However, when combined
with premium pricing for lower carbon LNG supply and lower
cost renewable power, the incentive for e-LNG is expected to
grow in the coming years to aid in decarbonizing the natural
gas supply chain. Even if market conditions do not support
e-LNG economics, adopting electric drives-considering fuHydrocarbon
Processing | AUGUST 2022 59
Hydrocarbon Processing - August 2022

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