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Clean energy journalism for a cooler tomorrow

New DOE-backed projects tackle factory emissions with heat pumps and more

The Biden admin is directing $500M toward factories that will use heat pumps, electric boilers and thermal energy storage to provide clean industrial heat.
By Jeff St. John

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A thermal battery made by Rondo Energy undergoing testing at 1000 degrees Celsius.
A thermal battery made by Rondo Energy undergoing testing at 1000 degrees Celsius. (Rondo Energy)

Last week the Biden administration awarded a whopping $6 billion to efforts to decarbonize heavy industrial sectors. About $500 million of that windfall will be allocated to projects tackling the most common source of industrial carbon emissions — generating the heat needed to make everything from industrial chemicals to macaroni and cheese.

A half-dozen companies plan to use the Department of Energy grants to deploy a range of low-carbon industrial process heat technologies: electric-powered heat pumps, which deliver low-temperature heat far more efficiently than by burning fossil fuels; electric boilers and heaters that can become cost-effective as they’re able to tap into increasingly low-cost renewable power; on-site solar-thermal arrays that directly convert sunlight into heat; and thermal energy storage systems that do with heat what batteries do with electricity: store it when it’s plentiful and cheap to produce, and tap it later when electricity is more expensive.

Many awardees are trying a combination of these technologies and more. Kraft Heinz, the maker of well-known grocery staples like ketchup and macaroni and cheese, plans to use its DOE grant of up to $170.9 million to deploy heat pumps, electric heaters, and electric boilers in combination with biogas boilers, solar thermal, solar photovoltaic, and thermal energy storage” at 10 of its facilities.

Industrial process heat is distinct from steel blast furnaces, cement kilns and other key sources of industrial climate pollution. But it still accounts for roughly one-third of industrial carbon emissions, which themselves make up about one-third of total global human-caused greenhouse gas emissions.

Some of the low-carbon options for generating process heat, such as heat pumps, are already widely used in Europe. Others, such as thermal energy storage, are in the earliest stages of deployment. But in the U.S., where cheap natural gas is plentiful, the economic pressure to switch to cleaner alternatives has yet to drive major investments.

That’s why government backing is important, said Jeffrey Rissman, industry program director at the think tank Energy Innovation and author of the newly released book Zero-Carbon Industry: Transformative Technologies and Policies to Achieve Sustainable Prosperity.

We have an understanding of the technologies that can produce all the goods we rely on without greenhouse gas or other pollutant emissions,” he said. But there hasn’t been demand to commercialize many of these technologies and adapt them into products that industries can simply install.”

First-of-a-kind projects like those just awarded DOE grants can prove these technologies work,” he said, and drive down the cost of industrial machinery so it can be rolled out more widely.”

Where the industrial sector stands on clean heat options 

Clean-heating technologies are both cost-effective and capable of meeting the needs of an increasing number of industries today, according to the Renewable Thermal Collaborative, a coalition of companies working on replacing fossil fuels with carbon-free alternatives.

In a September report, the coalition broke down the share of greenhouse gas emissions from multiple U.S. industrial sectors, including several — chemicals, food and paper — that are good targets for electric heating.

Chart of U.S. industrial thermal emissions for different manufacturing sectors, 2018 data
Renewable Thermal Collaborative

Not all clean heat” technologies are suitable for every industry. Some, such as steelmaking and cement production, require super-high temperatures or rely on combustion as part of their core processes.

But a significant share of industrial heating needs fall into low-temperature” ranges — largely steam heating that can be cost-effectively delivered by industrial heat pumps today — or into medium-temperature” ranges that a combination of electric-powered heating, solar-thermal systems or thermal energy storage can provide. 

Chart of estimated share of U.S. industrial emissions by temperature range, 2018 data
97% of the food and drink industry’s thermal emissions are from low-temperature processes that are relatively easy to decarbonize. (Renewable Thermal Collaborative)

Europe is well ahead of the U.S. in deploying alternatives to fossil fuels in these low- and medium-temperature ranges, Rissman said, largely because European companies don’t have access to cheap fossil gas as North American manufacturers do. The economics of switching to electricity have been far less compelling in the U.S.

But as electric-powered heating technologies become cheaper and more efficient, and supplies of low-cost electricity from U.S. solar and wind power increase, the gap between the cost of heating with fossil gas and heating with electricity will shrink, according to Renewable Thermal Collaborative’s forecasts.

Chart of carbon-free industrial process heating technologies' cost competitiveness against fossil gas in the U.S.
Renewable Thermal Collaborative

Heat pumps: Using electricity to move heat, not make it 

Heat pumps are a particularly attractive option for industrial settings for the same reason they’re becoming increasingly popular alternatives to fossil-fueled heating in homes and businesses: their innate energy efficiency. Heat pumps use pipes, pumps and liquid to extract and transfer heat from one location to another, working much like refrigerators and air conditioners do, only in reverse.

That allows them to achieve a coefficient of performance (COP) — a measure of the heat they can provide as a ratio of the energy going into the work they do — of 2, 3, 4 or even 5, depending on how efficiently they operate, the range of temperatures they must provide and how much waste heat they can use as part of their process. Fossil-fired or electric-resistance furnaces or boilers, which use energy to make heat directly, can never achieve a COP of greater than 1, by contrast.

These efficiency advantages have driven down the total levelized cost of heat” for heat pumps to a range that’s competitive with that of heat from fossil-gas-fired systems across most of the U.S., and even lower in many states, according to the Renewable Thermal Collaborative.

Technological advances have also increased the temperatures heat pumps can effectively deliver, the coalition noted in its September report. Industrial heat pumps can provide heat and steam up to 130 degrees Celsius, hot enough for about 42 percent of U.S. industrial thermal needs today.

By 2030, better technologies are expected to enable that heat to cost-effectively reach up to 200 degrees Celsius, hot enough for about 60 percent of industrial settings.

Major manufacturers such as Danfoss, Emerson and Siemens already make industrial heat-pump systems widely used in Europe. Skyven Technologies, a Texas-based startup, is hoping to use its DOE grant of up to $145 million to expand the markets for its U.S.-made industrial heat-pump system.

Our system electrifies steam production,” said Arun Gupta, Skyven’s founder and CEO. Even here in the United States, with relatively low natural-gas prices, we’re able to deliver steam at the quality and pressure needed for industrial manufacturing at a lower cost point than natural-gas boilers.”

Skyven uses an energy-as-a-service” business model to reduce the cost to its customers, he added. We measure how much steam the system produces and how much the customer would have had to pay to make that steam with a natural-gas boiler — how much avoided natural-gas cost is there.” The manufacturing facility pays for the delivered heat at prices lower than its current natural-gas costs and shares the savings with Skyven and third-party financing partners to pay back the cost of installing and operating the system.

These systems have been demonstrated on a few one-off projects,” Gupta said. The opportunity now is to productize and scale it.” The company plans to use its DOE funding to partially cover the cost of deploying its heat-pump system at a portfolio of as-yet-undisclosed sites.

Skyven’s heat pumps are designed to serve the largest industrial sites and are roughly the size of a bus. But the U.S. has about 6,000 large-scale manufacturing sites that would be a good fit for the heat-pump technology — and worldwide, the number is about six times that,” Gupta said.

Smaller industrial sites looking to replace gas boilers with heat pumps also have options. Last year, Colorado-based startup AtmosZero unveiled its industrial heat pump designed to fit into existing factory boiler rooms and announced its first commercial project in a brewery owned by New Belgium Brewing.

For low-temperature steam production, AtmosZero’s heat pumps can be a plug-and-play [replacement] for an existing boiler and are more efficient to operate than existing technologies on the market today,” said Ashwin Salvi, co-founder and COO. Earlier this year, the company raised a $21 million financing round and won a $3 million DOE grant aimed at financing the next generation of its heat pumps capable of much higher output temperatures,” he said.

For industrial processes that need hotter or higher-pressure steam than what heat pumps can provide, electric boilers can fill the gap. Electric boilers use electricity much less efficiently than a heat pump, because they have to convert the electricity into heat instead of moving heat from place to place,” Rissman said.

But they can be useful in stepping up” steam made by a heat pump to the higher temperatures necessary in industries such as refining and chemicals production, he said. Most industries won’t need steam that hot — but some might.”

Thermal energy storage: Turning clean electrons into high-temperature heat

For even higher temperatures, thermal energy storage systems are a very promising technology, Rissman said. That’s because they combine the utility of high-temperature heat — 1,500 or even 1,700 degrees Celsius, which is hot enough for the vast majority of industrial processes” — with the ability to shift clean energy from times when it’s abundant to times when it’s scarce.

The concept of thermal energy storage is relatively simple: enclose a material that’s good at retaining heat inside some kind of insulation and use electricity to heat up, or charge,’ the battery via electric resistance,” he said. Then these systems can either pump air or another gas through the storage medium to absorb the heat and carry it out to where it’s needed, or open an aperture in the insulated enclosure to let the heat escape.

Investors have poured hundreds of millions of dollars into dozens of companies seeking to put these fundamentals of physics into commercially viable products. The end goal is to tap excess wind and solar power to make and store heat that can be unleashed to decarbonize a whole range of industrial processes that will be hard to convert from fossil fuels via other means.

It’s not clear that the economics of thermal energy storage systems will work for industrial customers before lots of cheap surplus wind and solar power are commonly available on power grids across the U.S. But to prove whether they’re capable of doing the high-temperature heat work that industrial customers would want them to do, thermal storage systems need to be deployed in pilot projects well before that era of plentiful clean energy arrives.

That’s the goal of two projects awarded DOE grants this week. The first is at the ISP Chemicals plant in Calvert City, Kentucky, which will receive up to $35.2 million to replace heat from fossil gas boilers with heat from a thermal battery made by Boston-based startup Electrified Thermal Solutions. The second is a partnership between alcoholic beverages giant Diageo North America and California-based thermal battery startup Rondo Energy, which will receive up to $75 million to replace gas-fired heat with Rondo Heat Batteries at facilities in Kentucky and Illinois.

Heat batteries deliver energy at a lower cost, and right away at a lower carbon-intensity, than other pathways,” said John O’Donnell, CEO of Rondo Energy. The company commissioned its first commercial-scale installation at an ethanol production facility in California, and it recently announced plans with Portuguese clean energy developer EDP to develop up to 2 gigawatt-hours of its heat batteries in conjunction with up to 400 megawatts of wind and solar projects.

In Europe, where fossil gas costs two to three times what it does in the U.S., those numbers work in the market now — that’s why EDP is doing what they’re doing,” he said. And we’re in this place in the United States, even with much lower fossil costs, where it’s beginning to work now.”

Jeff St. John is director of news and special projects at Canary Media. He covers innovative grid technologies, rooftop solar and batteries, clean hydrogen, EV charging and more.