Executive Summary

Methanol and Di-Methyl Ether (DME) are emerging alternative liquid fuels for transportation. While methanol could be used directly or blended with gasoline, DME is suitable for diesel engines. Methanol is a liquid at ambient temperature but the boiling point of DME is much lower and could be handled like Liquefied Petroleum Gas (LPG). DME also has excellent flammability and is a better replacement for LPG. During the last few years the use of methanol and DME as fuel has increased significantly. Methanol demand is growing at a robust 6 to 8 % annually. The demand for DME has also increased and much of the methanol demand is because of its usage in production of DME. In India, the use of both methanol and DME as fuel component is very low at present. Currently, there is surplus production of methanol in the world but the demand in India is much more than the indigenous production. Although the use of methanol and DME as alternative transportation fuel was initially fuelled by their excellent burning characteristics and lower GHG emission, however subsequently, with the price advantage of natural gas, methanol and DME derived from natural gas penetrated into the liquid transportation fuel market. Recently, coal has also been widely used, particularly in China, for production of methanol and DME for fuel application. Unlike gasoline or diesel which are mostly produced from petroleum crude, methanol and DME could also be produced from renewable sources, such as biomass via syngas or via reforming of biogas.

With the increasing concern about GHG emission from energy usage, the fuels produced from renewable sources are being favoured over the non-renewable sources. From biomass virtually carbon-neutral fuel can be produced. To meet the increasing energy demand in the developing countries, dependence on fossil fuel will continue for many years to come, till viable renewable energy is available and delivered to users. The large methanol/DME plants, based on fossil fuels, could easily reduce impact to the environment, by capturing the carbon produced during the processing of the hydrocarbon source to methanol/ DME. Therefore, the current trend in the world is to have more focus on capture of carbon dioxide, if fossil fuel is used for production of methanol/DME, and smaller plants from biomass and MSW which again produce carbon neutral fuel. It may be noted that with the progressive developments in technology, these gasification plants are becoming cheaper to build and operate.

In India, all the methanol plants are based on natural gas or naphtha. Although there is great demand for methanol in India, the availability of natural gas and price of naphtha along with the low import price of methanol, is preventing new plants from being set up. The utilization of biomass in India is not very well organized. Much of this is burnt as such in several biomass based power plants. Since late 90’s several plants are operating in India based on gasification technology, developed by Indian Research groups. These are small units producing as low as 20 KWH energy. These plants operated without any technological issues and were economically viable. Therefore, it is very much possible to build up DME plants also based on small scale bio gasifiers with indigenous design from TERI, IISc. or from other local sources. Although India is having many biogas plants through anaerobic digestion, most of them are of small capacity, and in most cases cater the local requirements at a very low investment cost. It may not be worth to consider this segment for methanol or DME production. Larger biogas plants could be planned with the available digestible biomass from large animal farms or similar sources and convert the available biogas to methanol or DME via steam reforming. MSW is another good source of low cost hydrocarbon feedstock for power generation.

India generates about 50 MT of MSW per year which could easily produce more than 1500 MW of power. While disposal of the waste and generation of power is in focus, production of chemicals was never considered in India so far, from MSW. It is worth considering methanol/DME plants in some of these cases. There are several emerging technologies in the area of methanol/DME production. The most promising is the use of plasma arc for gasification and carbon dioxide hydrogenation. These technologies have great promise for waste disposal and carbon dioxide fixing. Plasma based technology can handle wide variety of feed materials with production of, harmless slag. It is suitable for gasification of assorted biomass or solid waste in small and medium scale. The economics of conversion of carbon dioxide to methanol with hydrogen depends on the availability of low cost renewable hydrogen and concentrated carbon dioxide near the production facility. Geothermal energy is one of the cheapest sources of electricity, which could be used to split water for hydrogen. This report explores all the avenues for production of methanol and DME in India. Since methanol production in India is less than the demand, several large scale methanol plants can easily be installed. At present, there is no production of DME in India and the use of methanol as fuel is also negligible. Since the present objective is to introduce methanol as transportation fuel component, the only option is to produce from methanol by dehydration. A road map for implementation has also been presented in the report.

Published by TIFAC : Year 2018

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