We are happy to share the important experience of building the first commercial installation in Europe for the conversion of hydrogen into synthetic methane with a capacity of 2 MW. Importantly, construction took less than six months and was not subsidized. Let’s talk in more detail.
German startup Turn2X completed its first commercial synthetic methane project in Spain in March 2024 from green hydrogen and CO2, which according to Hydrogen Insight is realized at the same price as biogas, without any subsidies to cover costs.
According to Turn2X forecasts, the production volumes of this renewable gas produced by the company will equal the fossil equivalent within the next decade. There are also plans to significantly reduce the cost of technology with each new plant.
History of Turn2X
Turn2X started life as a research project at the Karlsruhe Institute of Technology, which developed a new reactor for the production of methane from H2 and CO2, and partnered with Uniper for a pilot plant in Germany, opened in 2018. This pilot project cost 28 million euros ($29.9 million), of which 18 million was covered by a Horizon 2020 grant from the EU.
Subsequently, the promising project expanded its geography. Turn2X in Extremadura (Spain) was has been built in less than six months with no government support, using a combination of equity and pre-payments from offtakers.
The German and Spanish plants are the same size, with the commercial project using a 2MW electrolyser, although Turn2X declined to provide figures for how much methane either system produced. According to the company, among the peculiarities of the markets are the prices for renewable electricity in Spain which are “four to five times” lower.
However, this still means that the synthetic methane comes with a green premium on its price tag, although Turn2X predicts that with stricter carbon taxes, higher costs of extracting fossil gas and falling renewable electricity costs, company’s product could reach cost parity in Europe at €60-70/MWh in the near future.
Turn2X customers
According to the company, three sectors are currently interested in purchasing synthetic methane:
- energy-intensive industry,
- shipping,
- utility sector.
CEO Philipp Kessler emphasizes that not all industries are ready to switch to RES, but where it can be done, it should be done. In the glass industry or shipping (where E-LNG is actively being introduced), for example, there are still many open technological questions.
The startup does not disclose the names of the client companies that have pre-purchased the plant’s volumes in Spain, but indicates that these are clients who can receive an additional green bonus in the process of supplying end users. Currently, supplies are small compared to needs, but they will be increased.
Vision of the future
Another reason for Turn2X’s optimism is the sheer scale of the gas market today. Even assuming a 90% reduction in the use of gas, as recommended by the IEA in its 2050 net-zero scenario, “10% of a $420trn market is still a $42trn market” while still offering opportunities to decarbonize. Therefore, the search for ways to decarbonize those industries that will use gas is still relevant.
Also, Turn2X has already announced its next project — “the largest renewable natural gas plant in the world”, which will be built in Spain along with a dedicated array of solar PV and using biogenic CO2 from a co-located biogas facility.
Despite the commercial potential, the company is applying for European grant funding to accelerate capacity growth and technology development. Their strategy is to deliver ambitious, albeit small, projects now (within 24-36 months) using a vertically integrated approach where Turn2X develops the methanation reactor, integrates the electrolysis stacks into the reactor rather than paying for additional plant balance, and builds own solar park.
Thus, Turn2X modular plants are a more affordable investment option and therefore of interest to investors. It is fast, not prohibitively expensive and clear, the developers are convinced.
Source: Hydrogen Insight.