eFuels Alliance - Our interview
Ralf Diemer, Managing Director of the eFuels Alliance, an association striving to promote the ramp-up of synthetic fuels globally, kindly replied to Eurofuel's questions.
- What does the eFuel Alliance stand for?
As an alliance of now 170 member companies, we represent the interests of the entire eFuel value chain. It is extremely important to us that we are an alliance that includes all players along the entire value chain. For this reason, we combine the voices of renewable energy producers, plant manufacturers, hydrogen producers, petroleum companies, logistics companies, car, vans and trucks manufacturers, filling station operators as well as customers. The same applies to the future application areas of eFuels. As the main drivers of overall emissions, the transport and heating sectors must be defossilised. eFuels represent an excellent opportunity to contribute to the fulfilment of the sectoral climate goals of the transport and heating markets. The establishment and use of eFuels strengthens and ensures industrial locations, secure supply chains and affordable mobility and heat in Europe and beyond.
- From your point of view: What hurdles do eFuels face today and how can we counteract them to promote the ramp-up?
The biggest barrier continues to be the pointless debate between electrification and synthetic fuels. While hardened opinions repeatedly clash, this discussion misses the fundamental core of both efforts: an ambitious climate protection. None of the technologies is "the silver bullet". Only the use of combined potentials will help us to achieve the climate goals. Climate protection does not work by taking a path, putting on the blinkers and galloping off. Looking beyond the end of one's nose, i.e. creating and using sector coupling and synergy effects, is indispensable and thus profitable for the climate - this applies to the transport sector as well as the heating sector. Often, the stock of oil and gas heating is simply ignored which is being replaced much more slowly than the stock of combustion vehicles. Especially with rising electricity prices and overloaded electricity grids, the one-sided installation of heat pumps or e-mobility must be questioned.
But the challenges are numerous and go beyond these problems. Through the Fit for 55 package, the EU is taking a fresh look at all the laws. Against the backdrop of an escalating climate crisis, this step is also essential. However, it is important to think in a technology-open way when revising the corresponding legislation. If important sub-quotas for eFuels are not set ambitiously enough or even incentives for greenhouse gas intensity are not taken into account, a large part of the market will firstly lack the all-important planning horizon and secondly the even more important investment security. If European policy fails in this task, the ramp-up of eFuels and consistent climate protection will be unnecessarily delayed and Europe will lose out once and for all.
To ensure that the necessary capacities are available, the scale up of eFuels in transport and heating is crucial, as low costs can only be achieved with a corresponding market volume. In order to achieve the climate targets, it is therefore essential from our perspective to enable the market ramp-up of CO2-free hydrogen and its downstream products without delay and to quickly create the necessary regulatory incentives. We support the revision of the Energy Tax Directive, which provides for significantly lower minimum tax rates for sustainable energy sources. Rapid implementation would be highly desirable. We also welcome the extension of emissions trading to the heat and transport sectors, as this provides a clear path (planning security) and reduces the differential costs between fossil and renewable fuels. We therefore expressly support the significantly accelerated expansion of renewable energies announced by the EU as well as the rapid development of import infrastructures for hydrogen and alternative fuels.
- What does the efuel Alliance think about the future of liquid fuels for heating?
Until eFuels are competitive in the building sector, a targeted and accelerated build-up of corresponding production capacities is needed - no question. Blending is already possible today and should not be dismissed in the building sector. That is why we are strongly promoting the above-mentioned political demands in Brussels. A special aspect is that, for example, the production of eFuels through the so-called Fischer-Tropsch route always produces by-products that can be used in the heating sector. In addition, we consider the use of eFuels in the heating sector to be the most socially responsible way of energy transition. High production costs of eFuels in the beginning are insignificant due to lower blends. In the long term, scale effects ensure that production costs decrease and blending can be increased. With this principle, heating costs remain constant and consumers are not burdened with high initial investments for PV or heat pumps.
19 January 2023
