[C Tech Now] The World is Enthralled by the 'Clean Methanol Project'... Korea Takes Its First Step Now

Production Expansion in North America, Europe, and China
Taebaek City in Korea as Pilot Project

On September 3rd, a business agreement ceremony for the clean methanol production project was held in Taebaek City, and a commemorative photo was taken. (2024.9.3) Photo by Taebaek City

So far, global methanol production and consumption have been primarily driven by China, but with clean methanol gaining attention as an eco-friendly ship fuel, production of clean methanol is expected to expand significantly in North America, Europe, and other regions. South Korea's clean methanol production is just taking its first steps.

According to the "Renewable Methanol" report published by the International Renewable Energy Agency (IRENA) in 2021, global methanol production in 2019 was 98 million tons, mostly produced in China through coal gasification. Currently, most methanol produced worldwide is brown methanol. More than half of global methanol consumption also occurs in China, with 55 million tons consumed there as of 2018.

In China, methanol has been produced as a raw material for polyethylene, polypropylene, and other products, but recently it has also been used as automotive fuel. Many vehicles in China run on a blend of methanol and gasoline or use 100% methanol. As of the end of 2023, about 4,000 medium and large methanol trucks are operating in China. There are approximately 140 M100 (100% methanol fuel) refueling stations across the country.

With the anticipated increase in demand for clean methanol as a ship fuel, production of bio-methanol and e-methanol is expanding globally, not only in China but also in Europe and North America. According to the Methanol Institute, as of August 2023, more than 90 clean methanol projects are underway worldwide. It is expected that by 2027, annual production capacity will reach approximately 6 million tons of e-methanol and 4 million tons of bio-methanol. Regionally, North America has 14 projects, Europe 41, and China 19 clean methanol projects. In 2022, bio-methanol production was only about 300,000 to 400,000 tons.

Although clean methanol production is increasing, concerns remain that it will not meet the demand for methanol-powered ships. BloombergNEF projected in August last year that "green methanol production will reach 5.5 million tons in 2027, 11 times the current level," but also pointed out that "540 million tons will be needed by 2050 to fully replace all marine fuels." To replace conventional ship fuels, clean methanol must simultaneously expand production capacity and reduce costs.

In South Korea, a pilot project to produce clean methanol is underway in Taebaek City, Gangwon Province, in collaboration with the government. In September, Taebaek City signed a business agreement with Plazen, Hyundai Corporation, Korea East-West Power, Optimum Trading, Ssangyong Construction, LF Energy, Hanbit Energy, ESTEC Korea, and Infra Frontier Asset Management. These public and private entities plan to establish manufacturing facilities capable of producing 10,000 tons of clean methanol annually. The Carbon Neutral Green Growth Committee, which formed the Clean Methanol Initiative last November, has set a goal to achieve a production capacity of 500,000 tons of clean methanol by 2030.