29 Sep 2021

N California Plans Tighter Rules for hydrogen plants

29 Sep 2021  by   
Regulators in northern California are working to implement new regulations onemissions from hydrogen plants within petroleum refineries, the latest example of tightening compliance standards for refiners in the region.

New limits on vented methane and organic compound emissions from refinery hydrogen plants could be approved early in 2022 as regional regulators pursue greenhouse gas (GHG) reduction targets, according to a presentation yesterday from Bay Area Air Quality Management District (BAAQMD) officials.

The move would likely force two refineries to install potentially costly refinery flare technology. BAAQMD previously named Valero, owner of a hydrogen plant at its 145,000 b/d Benicia refinery, and Air Products, owner of three plants at PBF Energy's 157,000 b/d Richmond refinery, as potentially affected parties.

Refiners use hydrogen in several units to process crude into gasoline, diesel and jet fuel. These includes hydrotreaters, which remove sulfur and other undesirable compounds from hydrocarbon feedstocks, and hydrocrackers, which react heavy distillates with hydrogen to make higher-value products. Refinery demand for hydrogen, which is usually produced through steam methane reforming using natural gas, has increased over the past decade as product specifications become more stringent in step with environmental requirements.

BAAQMD has expanded checks on refiners in recent years with an eye on reducing GHG emissions in the San Francisco Bay area to 40pc below 1990 levels by 2030, and 80pc below 1990 levels by 2050. It has already passed a new regulation this year on emissions from fluid catalytic cracking units (FCCs) that has prompted lawsuits from Chevron, owner of a 250,000 b/d refinery in Richmond, California, and PBF Energy.

Less venting, more monitoring

Under the new draft rule, hydrogen plants at refineries in the region would be required to limit venting of organic compounds to 15 lbs/d (6.8 kg) and 300ppm on a dry basis. Operators will also be required to increase the frequency of periodic emissions monitoring, among other measures.

Valero would be "significantly impacted" by the new emissions controls, which do not allow exemptions for venting occurring during start-ups, shutdowns or emergencies, the company said in a July letter to the BAAQMD. Air Products asked that the regulator amend the proposed rule to only cover methane emissions and not organic compound emissions already covered by another regional rule, in its own July letter. The company has estimated the cost of new flare systems at Martinez at approximately $40mn.

BAAQMD is also moving forward with a plan to expand emissions checks on renewable fuel refineries amid the conversion of petroleum refineries owned by Marathon Petroleum and Phillips 66 toward renewable diesel production.

The regulator will evaluate alternatives to the new compliance standards for hydrogen production and distribution through November and has scheduled a final hearing on the revised rule for February 2022.

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