28 Mar 23

E-fuels explained: everything you need to know

The news that the European Commission has left open the door for the manufacture and sale of vehicles with internal combusion engines after 2035, so long as they are powered by synthetic e-fuels, has raised a number of questions about these carbon neutral fuels. Here are some of the answers...

What are e-fuels?

E-fuels are synthetic fuels that can be used to power internal combustion engines.

How are e-fuels made?

Electrolysis breaks down water into hydrogen and oxygen, and the hydrogen is then combined with carbon dioxide (CO2) to create a liquid e-fuel. Importantly, the hydrogen is produced using renewable electricity and the CO2 is taken directly from the atmosphere or captured from industrial plants.

Why are e-fuels different to biofuels?

Biofuels are made from biomass – typically crops grown to produce oils – whereas e-fuels are made from water and CO2.

Why are e-fuels carbon neutral?

E-fuels do produce CO2 when they are burned in an internal combustion engine, but the concept is that these emissions are equal to the CO2 removed from the atmosphere to make the e-fuel.

Can e-fuels be used in conventional internal combustion engines?

Yes, they are compatible with ICE engines. This means they can provide a climate-neutral way of powering legacy ICE vehicles during the transition to battery electric powertrains. In addition, their impact is immediate, accelerating the decarbonisation of road transport.

E-fuels also have huge potential for decarbonising heavy commercial vehicles, ships and aircraft.

How are e-fuels supplied?

E-fuels can use the same supply chain as petrol and diesel, such as tanker lorries and filling stations. They can even be blended with standard, oil-based petrol and diesel.

How are e-fuels stored?

E-fuels are stored just like petrol and diesel at room temperature. In liquid form they do not require pressure. This makes them easier to transport and store than hydrogen.

How much will e-fuels cost?

Forecasts vary widely for how much mass-produced e-fuels will cost. The e-Fuel Alliance claims that economies of scale will lead to falling production costs, and that by 2050 e-diesel will cost between €1.38 and €2.17 and e-petrol will cost €1.45 to €2.24, depending on taxes and duties.

Transport & Environment says e-petrol could cost more than €2.80 per litre at the pump in Germany in 2030 – 50% more expensive than regular petrol today – due to its energy intensive and complex production process.

What are the advantages of e-fuels?

E-fuels offer a climate neutral source of energy, and a way to store excess renewable electricity. Countries with an abundance of solar or wind power can capture energy in e-fuels that would otherwise be lost.

Do e-fuels have the same emissions as conventional fuels?

No, e-fuels are cleaner, emitting significantly less nitrogen oxide and particulate matter than petrol and diesel.

Are e-fuelled vehicles greener than battery electric models?

This is a complicated calculation. An ICE vehicle fuelled by e-fuels would have a lower carbon footprint when it rolls off the production line than an electric vehicle, due to the energy required to make the battery pack. It would also have simpler disposal/recycling issues at the end of its life than a BEV.

Moreover, BEVs are only clean when they are powered by renewable electricity. In the most recent figures published by the European Union, 41.9% of Europe’s electricity is generated by combustible fuels, although the share of renewable power is rising on an annual basis.

However, BEVs are much more efficient in converting electricity to energy than e-fuelled ICE vehicles. According to Volkswagen, the numerous individual steps involved in producing e-fuels mean that only around 25-30% per cent of the energy used in the process remains at the end, whereas a BEV converts the energy used into power at a rate of around 70-80%.

A study published in the Nature Climate Change journal, suggested that powering an ICE car with e-fuels requires about five times more renewable electricity than running a BEV.

What are the arguments against e-fuels?

Environmentalists argue that the EU’s proposed ban on the sale of ICE vehicles from 2035 sends a powerful signal that the world’s largest car and van market is going electric. Allowing e-fuelled ICE vehicles after this date undermines the clarity of this message.

They also insist that the short supply of e-fuels should be directed to hard-to-transition sectors, such as shipping, aviation and steel production, rather than road transport where batteries already provide a viable solution.

Why do some OEMs favour e-fuels?

Vehicle manufacturers have invested massively in electrification programmes, but some don’t want to put all of their eggs in one basket. Maintaining competition between different carbon neutral technologies could inspire innovation and progress.

There are also concerns that the expansion of charging infrastructure will not keep pace with the numbers of new electric vehicles, and that soaring demand for the raw materials essential to produce batteries leaves OEMs vulnerable to global supply chains and means EV prices might have to rise.

The most important goal, according to OEMs, is achieving carbon neutral transport, not the technology that delivers this.

Sigrid de Vries, ACEA Director General, said: “We strongly believe that a technological-neutral approach – with widespread electrification at its core – is the best way to achieve climate goals.”

When will e-fuels become available?

Mass industrial production of e-fuels is unlikely to start until 2025 at the earliest, although Porsche is a stakeholder in Highly Innovative Fuels, which has started the industrial production of synthetic fuels in Chile (pictured below).

Barbara Frenkel, Member of the Executive Board for Procurement at Porsche AG, said: “Porsche is committed to a double-e path: e-mobility and efuels as a complementary technology.”

However, both Ford and Volvo signed a letter saying EU businesses need clarity in legislation to support their longer-term plans to switch to electric vehicles, and that allowing the sale of petrol and diesel cars after 2035, even if powered by e-fuels: “Would have adverse consequences for the environment and air quality.”

How could OEMs guarantee that new ICE vehicles sold after 2035 would only be fuelled by e-fuels?

Technical solutions, such as separate fuelling nozzles or fuel cards, could provide answers, although the e-Fuels Alliance prefers the idea of a credit system. This would see OEMs finance the additional production of e-fuels, and in return receive credits that they could use to offset the CO2 totals for the vehicles they manufacture. The European Commission set a fleet-wide CO2 emission target for car manufacturers of 95g/km in 2020, which will tighten by 15% from 2025 and by 37.5% from 2030.

Images: Shutterstock, Eurostat, Porsche

Authored by: Jonathan Manning