FRANKFURT (Reuters) - German clean-tech company Sunfire and French oil major Total TOTF.PA said on Wednesday they will team up on a pilot project to produce methanol from renewables and carbon dioxide at the Leuna refinery in Germany.

FILE PHOTO: The logo of Total oil company is pictured in Abuja, Nigeria October 18, 2017. REUTERS/Afolabi Sotunde

Refineries are counting on hydrogen technologies to make good on pledges to cut harmful emissions by turning carbon and renewable power into novel fuels to replace oil and gas.

Sunfire and Total - a major shareholder in the Leuna refinery - said a plant would be completed at the refinery next year and production was expected to start in 2021, generating 500 tonnes of green methanol in the first three years.

Dresden-based Sunfire will provide and operate a 1-megawatt electrolyser that could later be integrated in the production of industrial-scale amounts of green methanol and hydrogen from CO2 generated in the refinery processes.

“Total is delighted to develop efficient technologies to re-use CO2 to chemicals, materials and fuels,” Total’s Group Chief Technology Officer Marie-Noelle Semeria said in a statement announcing the project.

“Carbon capture, utilisation and storage is going to play an essential role in achieving carbon neutrality without curbing economic and social growth,” she added.

Total’s venture capital arm is a minority shareholder in Sunfire.

The electrolyser will allow steam or waste heat from the refinery’s operations to be used and complement and reduce the use of green electricity, the companies said.

Leuna is located in northern Germany which often produces excess wind power as a result of a subsidised turbine building programme over the past 20 years that has driven experiments with hydrogen plants.

By splitting power into oxygen and hydrogen, water-based electrolysis can produce fuels that are easy to store and transport.

“This (electrolysis) technology can become the core building block for energy sectors that cannot source electricity directly from renewables,” said Nils Aldag, managing director of Sunfire.

“With the transformation into renewable gases and fuels and the use of existing infrastructures, we can make the transport sector and the chemical industry climate-neutral.”

Sunfire and Total did not disclose the costs of the project.