17.01.18

By Lars Udby, CEO at Hydrogen Valley

For a while it looked like the production and usage of electro fuels weren’t going to be included in the calculations of how much we reduce our CO2 emissions. This is despite the fact that e-fuels can replace fossil fuels as gasoline and diesel and contribute to reduce the CO2 emissions in the transport sector – one of the big challenges in the green transition of our society.

We are referring to the new directive – Renewable Energy Directive (RED II) – which EU is to negotiate a settlement on in the first quarter of 2018. A directive, which presents how we can reduce the CO2 emissions until 2030. The directive also decides which initiatives can be included when the total calculations are made up.

But is it important to include the e-fuels?

Yes, because if electro fuels are not included, nobody will be willing to pay an added premium price compared to fossil fuels or make investments in the novel synthetic E-fuel-production. And then we will miss out on the opportunities that these fuels can contribute with in the green transition.

But why talk about e-fuels – isn’t it batteries that will dominate the green transition of the transport sector? There is no doubt that electric cars will become an important part of the future transport. However, batteries cannot meet the requirements of long distance transport, heavy-duty transport, long (and short) haul ships and airplanes. Here we need to think along other lanes. Hydrogen and e-fuels can be alternatives.

Green methanol will use CO2 from biogas and surplus electricity from wind turbines

In our terminology E-fuels are advanced- or biosynthetic fuels based on a renewable power to electrolysis-hydrogen source and a bio based feedstock biofuel and/or a feedstock from carbon monoxide or carbon dioxide source.

E-fuels includes i.a. methanol and dimethyl ether (DME), which can be produced by letting hydrogen react with CO2. CO2, which otherwise would be separated and released to the atmosphere, can be captured from e.g. a biogas plant, before the biogas is added to the natural gas grid as bio-methane. The hydrogen can be produced from water electrolysis by using surplus electricity from wind turbines, when more electricity is produced than needed in the grid. If the methanol production is based on these two sources, we can regard it as green methanol.

In this way, methanol is using both CO2 and surplus electricity. Methanol can be added to fuels for transport and partially replace diesel and gasoline. Today, ethanol is added in order to reduce the gasoline/diesel consumption. But methanol is fully competitive with ethanol when it comes to energy efficiency and lowering of CO2 emissions.

In addition, methanol production is not based on food crops and is not competing with crops on the farm land. Furthermore, the methanol production can also help us to balance the electricity grid by making it profitable to lead the electricity in to an electrolyser, when there is too much electricity instead of exporting it.

A windy country like Denmark should fight for e-fuels

For a long time, it looked like the EU directive only would acknowledge bio-based fuels (biogas or ethanol) in the total CO2 registry. While fuels which are made by storing electrical energy from renewable sources, which are the characteristics of electro fuels, did not count in. But in the last minute the way has been paved for including e-fuels in the total calculations.

It is very important for a country like Denmark to get e-fuels such as methanol included in the coming Renewable Energy Directive as a fuel which can be counted in the total CO2  ETS calculations.

Denmark has a large amount of fluctuating wind in the grid, therefore we need initiatives which can balance the electrical grid. Here the production of hydrogen has a huge potential as it can be included in the production of green methanol, provided that there will be a market for it in the future. And the market and demand for green methanol will only arise if methanol is acknowledged as a fuel to lower the CO2 emissions and will be included in the RED II.