Huge amounts of synthetic fuels generated from renewable energies will be required to fully decarbonise the German economy, according to industry association BDI, which eyes yearly imports of 340 terawatt hours (TW/h) by 2050 – the equivalent of Germany’s entire power fleet.
“For ambitious climate and energy targets, we will need Power-to-X in significant amounts,” said Carsten Rolle, executive director at the World Energy Council Germany, and head of energy and climate policy at BDI, the German industry association.
Power-to-X is a broad term referring to the transformation of electricity into synthetic gases – such as hydrogen, methane or other gases and liquids, according to the European Commission.
“Probably the most powerful driver will be the transport sector,” Rolle told journalists during a visit to Brussels last week, saying the heaviest users of synthetic fuels are expected in aviation and shipping, where electrification is not yet feasible, especially for long distances.
Under EU projections, low-carbon electricity from renewables and nuclear should cover just over half of Europe’s total energy demand by 2050, which leaves more than 40% for liquid fuels and other types of green gases, such as hydrogen.
Those technologies “become attractive in the context of abundant electricity generated from carbon-free sources” such as wind, solar and nuclear power, the Commission said in its energy policy scenarios for 2050, published in November.
But it is the import figures that BDI has in mind, which are truly eye-popping. Those are contained in a report for the World Energy Council Germany, published in October last year, which Rolle helped oversee.
In Germany, one of the scenarios BDI identified for 2050 points to “an import demand of 340 terawatt hours (TW/h) of efuels”, Rolle said.
This, he added, “is broadly speaking equivalent to the capacity of the complete German power plant fleet in order to produce hydrogen or others efuels abroad for Germany”.
“We want to start a discussion”
Germany’s current energy consumption amounts to around 380 TW/h, which means around 90% of the country’s energy needs would be covered by imports at the current rate.
The imports are expected to come mainly from places like Australia, the Middle East, Africa or Latin America, which have a greater potential than Europe for renewables like solar and wind, Rolle said. And that’s “only for the purpose to produce hydrogen for Germany”, he added.
According to the World Energy Council, the global market for Power-to-X could reach 10,000 TW/h in 2050 under a low-case scenario. That would imply that 40% of marine and aviation fuels are covered by Power-to-X. A “small amount” of road freight and industry is also included there, said Rolle.
“Technology-wise, it’s feasible but it requires other framework conditions than the ones we see today,” he cautioned however. “That includes treating efuels equally to the direct use of renewable electricity in EU regulation for transport, for example, and needs close cooperation with these potential exporting countries,” Rolle said.
“We want to start a discussion about a roadmap,” Rolle explained, saying the World Energy Council “has put some important elements for that on the table” that would give investors more certainty about future market developments.
“It’s about creating a global market for Power-to-X,” said Rolle.
Europe looking into “Power-to-X”
German industry is not alone in looking at “Power-to-X” as a way of decarbonising energy use. The Commission also gave attention to the technology in its long-term climate and energy strategy for 2050, published in November last year.
“The potential advantage of power-to-X is that synthetic fuels can be stored and used in multiple ways across different economic sectors, where it is otherwise hard to decarbonise,” such as industry and transport, the Commission said in its strategy.
However, it also cautioned that synthetic fuel production is currently still an energy-intensive process which requires cheap electricity in abundant quantities.
Europe’s electricity sector is also showing interest in Power-to-X, especially for heavy industries like steelmaking, and in long-distance transport, which are both hard to electrify.
But for trade association Eurelectric, the energy losses clearly represent “a trade-off”.
“By definition, it’s a process where you have conversion losses. You start off with electricity, and you then transform it into liquid form, which means you lose energy along the way,” said Kristian Ruby, the secretary general of Eurelectric.
“And that’s especially the case when hydrogen is transformed back into electricity, because you have two conversions. That’s why we see very limited use of hydrogen in the power sector – it’s basically more expensive,” Ruby told EURACTIV in a recent interview.
This is also why Eurelectric’s deepest decarbonisation scenario sees Power-to-X meeting only around 5% of Europe’s total final energy consumption.
But the World Energy Council holds a different view, saying production in sunny or windy regions of the world could be ramped up to become “significantly cheaper than P2X produced in Europe”. Large-scale transport infrastructure is already in place, which means the cost for long distances “are relatively low,” it adds.
“A global PtX market could be supplied by many potential producing countries,” it says, citing Australia as a potential “giant”.
According to the World Energy Council, a mature global market for green synthetic fuels could easily reach a size of 10,000 to 20,000 TWh/a by 2050, meeting around 50% of today’s global demand for crude oil.
[Edited by Sam Morgan]