Sasol Limited Climate Change Report 2021 - Book - Page 13
A NET ZERO AMBITION
Our Energy Business (CONTINUED)
Grow new value pools
FISCHER-TROPSCH TECHNOLOGY IS AT THE CORE OF POWER-TO-X SOLUTIONS
We see the biggest
opportunities for our Energy
Business in green hydrogen
for road transportation (heavy
duty trucking and commercial
vehicles), renewable energy,
SAF and sustainable chemicals.
These opportunities, which
are directly tied to our own
decarbonisation, will be more
aggressively pursued closer to
the 2030 time horizon. In the
interim, we are advancing proofof-concept projects through
partnerships to stimulate
demand, assess viability
and accelerate growth.
Green hydrogen is dubbed the fuel
of the future to decarbonise hard-toabate sectors, such as cement, iron
and steel and transport. Its growth is
dependent on abundant renewable
energy resources and water to
undertake electrolysis. Once produced,
green hydrogen can be combined with
a sustainable carbon source (biogenic,
transition industrial or atmospheric
carbon) to deliver net zero fuels and
chemicals. These net zero products
are necessary for a low-carbon future.
South Africa, together with Sasol, have
the requisite ingredients to produce
and convert green hydrogen for local
and global demand.
Green hydrogen, FT and Secunda
The FT process is dependent on hydrogen and carbon to make high-value
liquid fuels and chemicals. Large quantities of grey hydrogen are produced
from gasification of coal and the water gas shift reaction (WGSR). The
downside of the WGSR is the production of excess CO2, which is a key reason
for our large volumes of GHG emissions. Here lies our sizable reduction
opportunity, to replace grey hydrogen with green hydrogen. This also
presents a significant value creation proposition.
Producing SAF at Secunda requires the production of green hydrogen using
renewable energy and electrolysis. However, a sustainable carbon source is
required. Biogenic sources are limited in South Africa as they compete with
food; however, industrial carbon sources are plentiful and can be utilised as a
transition source. While production of SAF in Secunda is technically feasible,
it requires a hydrogen cost reduction to below ~$2/kg. Government incentive
schemes and product premiums are a means to bridge this cost divide. Today,
green hydrogen costs are five to eight times higher than grey hydrogen.
Globally, governments are incentivising green hydrogen to accelerate this
Using the existing Secunda facility presents a scale advantage. Internal
analysis indicates scaled production results in a greater than 30% cost
advantage compared to a greenfield facility. South Africa's endowment of
renewable resources has the potential to unlock a further 20% cost benefit.
This places Sasol at the top of the leader board when it comes to producing
the lowest cost green hydrogen-enabled products in the country.
CHEMISTRY OF TODAY
OF THE FUTURE
~22 tonnes CO₂
0 tonnes CO₂
At Secunda today, hydrogen is
required as a key building block
for hydrocarbons (liquid fuels
and chemicals). It is produced
using energy derived from coal.
1 tonne of hydrogen results in
~22 tonnes of CO₂, making us
highly carbon intensive.
For Secunda of the future,
we aim to produce hydrogen
without GHG emissions.
The chemistry requires
renewable energy and water.
Water usage will be less than
it is today with much greater
renewable energy required.
'MUST NEEDS' TO WIN
IN THIS SPACE
Key factors that must materialise for
Sasol to lead in sustainable fuels and
• Reduction in the cost of renewable
energy and green hydrogen to below
• Development of enabling policies and
incentives for renewable energy and
• Ability to secure requisite product
premiums for sustainably certified fuels
• Recognition for flexible and transition
product accounting rules for emerging
economy players to maximise high
• Access to affordable green financing;
• Development of the necessary
infrastructure for cost effective
and sustainable transport.
We believe the time is right for South Africa to tap into green hydrogen’s
potential and we want to play a leading role in its development.
The conversion process for green
hydrogen to sustainable fuels and
chemicals is termed PtX and is the most
effective route for producing these
products. Green hydrogen reduces
GHG emissions, is highly efficient from
a feedstock perspective and the PtX
process can be scaled to meet global
SAF market demand, which has a
corresponding green hydrogen demand
of up to 90 Mt/a by 2050 in a 1,5oC
1. The bulk of hydrogen is produced from coal but Sasol also produces hydrogen from gas at a lower intensity.
Sasol Climate Change Report 2021