An increasing number of governments around the world have committed to banning the sale of petrol and diesel powered cars, with the UK setting a date as early as 2030. The motor industry is being forced to transform to meet this enormous challenge. Many companies, such as Jaguar, are making eye-catching announcements to go all-EV as soon as 2025.
Against this backdrop, Porsche’s announcement that it is investing $24 million in a plant in South America to make carbon-neutral synthetic fuel for its internal combustion engine (ICE) cars, potentially extending the life of the venerable 911, seems out of step.
Even more so when, just a few weeks later, Porsche revealed that it had spent another $70m increasing its stake in Rimac Automobili, the Croatian firm specialising in EV supercars and technology, to 24 per cent. But it’s not an odd move.
Porsche remains committed to electrifying its range, expecting EVs and hybrids to account for 50 per cent of its sales by 2025. But its investment in producing carbon-neutral ‘efuels’ in Chile draws attention to an uncomfortable truth: even if only EV cars are on sale in 2030, around half of the cars on our roads will still be ICE. So what if some of those were powered by carbon-neutral fuel?
Bentley, a part of the Volkswagen Group with Porsche, is is also looking at synthetic fuels. “We think the combustion engine will be around for a long time yet,” its engineering chief, Matthias Rabe, said recently. “And if that’s the case, then we think there can be a significant environmental advantage from synthetic fuels. We’re positive about this technology.”
But the technology is not new. Synthetic, liquid fuels derived from coal and natural gas have been around for 100 years, and production is on-going. Efuels are also synthetic fuels but are carbon-neutral.
Carbon is captured from CO2 in the atmosphere or an industrial process such as steel making, hydrogen is extracted from water via electrolysis and the two are synthesised to create a hydrocarbon. However, efuels are only carbon neutral if the energy used to make them comes from a renewable source.
The location of plants making efuels is therefore dictated by a good supply of renewable energy. The Chilean plant in which Porsche has invested exploits plentiful wind power while the pilot plant of another efuel maker, Norsk e-fuel, utilises Norway’s abundant, renewable hydroelectric supply.
A benefit of efuels is that their quality and compatibility means they can simply ‘drop in’ to the current fuel distribution network, be added to regular fuels and used by ICE vehicles and hybrids without any engine modifications. In fact, efuels run cleaner and better because they are purer, having only eight to ten elements, whereas crude-derived fuels have 30 to 40, and they start reducing in CO2 right away.
Efuel development is also important to forms of transport that cannot practically convert to battery electric, such as aviation, shipping and long-distance road haulage. On the downside are the high cost of production and the low level of efficiency; it takes a large amount of renewable energy to create efuels. This means that efuels are expensive, though as the availability of renewable energy increases, the cost will come down.
Right now, efuel production is a tiny fraction of the energy picture, but an important one. Porsche will be the sole customer for efuel from the Chilean plant, expected to be 55 million litres by 2024, ramping up to 500 million litres two years later. The efuel will be used at its many ‘Porsche Experience’ driving centres and in motorsport – there are three international Porsche race championships, ten national series and numerous regional series.
Meanwhile, there’s Norsk e-fuel’s first industrial plant in Herøya, Norway, built in collaboration with Sunfire, a German company specialising in converting power into liquid; Climeworks, which specialises in CO2 air capture; Paul Worth construction; and Norwegian investor Valinor.
The plant is expected to deliver ten million litres of efuel to the European market by 2023, up to a capacity of 100 million litres annually by 2026. The UK alone consumed a total of 46.5 billion litres of petrol and diesel road fuel in 2019, so in comparison this is a truly tiny amount, but Herøya will serve as the blueprint for a nationwide roll-out of efuel plants.
Besides Porsche, other partners in the Chilean plant are Chinese energy firm AME, Italian energy firm Enel, Chilean petroleum company ENAP, and Siemens Energy. Siemens will even get a €8m grant from the German ministry for Economic Affairs and Energy.
“Renewable energy will no longer be produced only where it is needed but where natural resources like wind and sun are available on a massive scale,” says Christian Bruch, CEO of Siemens Energy. “New supply chains are going to emerge all over the world to carry renewable energy from one region to another.” Germany is also a net importer of energy. “Hydrogen will play an increasingly important role in storing and transporting energy, which is why the German government’s support for the project is an important signal.”
Porsche’s investment in efuel may be intended principally to prolong the life of its ICE cars, including the long-lived 911, but it also gives an insight into the part that ‘green hydrogen’ can play in storing and distributing renewable energy.
China massively reduced the cost of solar power and may be about to do the same for green hydrogen. Meanwhile, seven companies at the forefront of green hydrogen – ACWA Power, CWP Renewables, Envision, Iberdrola, Ørsted, Snam and Yara – have formed a coalition with the intention of increasing the production of green hydrogen 50-fold in the next six years, helping to transform the world’s most carbon-intensive industries: power generation, chemicals, steel-making and shipping.
It’s estimated that green hydrogen could supply nearly a quarter of the world’s energy needs by 2050. Will the 911 still be in production then? And if it is, will it still be powered by a flat-six?
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