Project/company overview
The client operates several large facilities globally, in an industry where decarbonisation is challenging, due to high energy demands and high availability/reliability requirements. A global corporate target of net zero emissions by 2050 resulted in additional pressure to move to transformational refining technologies, powered using renewable energy generation methods.
Problem
The client’s Australian operations were investigating the potential for renewable energy generation to meet their refining needs over the next two decades. Large-scale renewable generation, and the facilities’ setting, caused complexities including:
- Different refining technologies resulting in different load requirements
- Choices between the scale of each generation method (wind, solar), changing capital and operating costs, and land footprint
- The scale of firming required through grid or residual gas generation
- The role of storage technologies such as lithium-ion or flow batteries, thermal storage and pumped hydro
- Trade-offs between maintaining the operation’s EBITDA and minimising Scope 1 and Scope 2 emissions
- Commercial decisions such as self-generation, power purchase agreements (PPAs), purchase of offsets (Australian Carbon Credit Units), and sale of Large Generation Credits (LGCs)
Outcome / Value
Adaptus provided expertise in decision framing and probabilistic economic analysis to the study. This resulted in:
- A clearly structured set of objectives and options, which incorporated the uncertainties and trade-offs listed above;
- A clear direction on which refining technology would result in higher life-cycle energy costs, regardless of generation mix;
- Robust evidence that renewable energy could outperform business-as-usual gas generation, particularly when considering the future cost and regulatory risk attached to gas
- An understanding of the on-site renewable generation capacity, the optimal mix of technologies, and the scale of firming capacity required, which will educate conversations with third parties;
- An understanding of the key cost drivers and uncertainties, which required focused studies in future phases.
