E-fuels: frequently asked questions

Synthetic e-fuels are part of a range of decarbonisation options being explored for the road, aviation and shipping transport sectors. Where’s the biggest potential? What challenges must be overcome? Read on for an overview.

What are e-fuels?

E-fuels, also known as electrofuels, eFuels, synthetic fuels, Power-to-X (PtX), or Power-to-Liquids (PtL), are a type of synthetic alternative to fossil fuels. They are produced by combining green hydrogen, made from the electrolysis of water using renewable electricity, with captured carbon or nitrogen (for ammonia production). An e-fuel can be considered carbon-neutral if the emissions released into the atmosphere through its combustion are equal (or less) than the captured CO2 used to produce them.

Still a nascent technology, companies and researchers around the world are exploring the potential of e-fuels. In our Global liquid renewable fuels market tracker, available via our Liquid Renewable Fuels Service, there are more than 250 projects currently under development, though most are still in the early stages.

Can e-fuels compete with electric vehicles?

Some e-fuels – such as e-jet, e-diesel and e-gasoline – are considered ‘drop-in fuels’ because they could be used in traditional combustion engines and existing infrastructure without modification. As such, they have been the subject of much debate in the EU, after Germany campaigned for an e-fuel exemption to a ban on new sales of combustion-engine cars after 2035. Many climate campaigners, however, feel such a loophole could simply be a diversion from the broader electrification of road transport.

Most automotive companies are focusing on battery electric vehicles (EVs) rather than e-fuels. It’s a more established technology, and low-emission e-fuels are currently significantly more expensive to produce. Despite faltering EV sales in 2023 the broad direction of travel for road transport is clear. EVs are front and centre of global geopolitics, and 2024 looks set to be a defining year.

Are there other possible applications for e-fuels?

Despite the high cost, e-fuels are one of the few options to decarbonise the more difficult-to-abate transport sectors. The clearest potential for e-fuels right now is therefore in aviation, marine and heavy-duty road transport.

Synthetic e-fuels could arguably be the ultimate renewable shipping fuel, for instance. Versions of diesel, methanol and ammonia are all possibilities, though production costs are currently high.

In the aviation realm, the prospect of fossil-free fuel has attracted interest – and investment. In 2023, Scandinavian airline Norwegian and Norsk e-Fuel formed a strategic partnership to build the world’s first large-scale e-fuel production facility in Mosjøen, northern Norway. This is one of 13 sustainable aviation fuel (SAF) offtake agreements using e-jet.

Outside the transport sector, there is potential for electric natural gas (e-NG), which could be blended into existing gas networks and used in any sector.

What challenges would e-fuels need to overcome to live up to their potential?

Key challenges to commercially-viable e-fuels include cost and scalability. Collaborations between academia, public and private bodies will drive innovation in this space, but regulatory support is likely to be a critical factor in development and more widespread adoption. In the EU, legislation was published in 2023 that promotes e-fuels. The Renewable Energy Directive, ReFuelEU Aviation and FuelEUMaritime initiatives all have sub-targets or incentives that support e-fuel uptake in the transport sector.

Availability of green hydrogen capacity will also play a role in the evolution of synthetic e-fuels.

How can I find out more about e-fuels?

We investigated the potential of e-fuels in depth in Adding fire to e-fuels: are synthetic fuels the key to unlocking growth in hydrogen?

Plus, you can explore our Liquid Renewable Fuels Service, a comprehensive solution for navigating the complex renewable transport fuels market.