The debate about the future automotive drive system continues to be conducted with much passion in Germany. It is true that there is widespread agreement that CO2 emissions from the transport sector must fall in order to make substantial progress in climate protection. But the way to get there – open to technology and diverse or state-led and regulatory – is highly controversial.
With the “Fit for 55” package of measures, the EU Commission had already set ambitious targets for the implementation of the “Green Deal” in July 2021. For example, net greenhouse gas emissions from passenger cars are to be reduced by 55 percent by 2030 compared to the level in 2021. In spring of this year, the targets were drastically tightened again: CO2 equivalent emissions are to be reduced to zero by 2035. The consequence; from that point on, no new vehicles that can be fuelled with a fossil fuel may be registered. This effectively means the end of the internal combustion engine – even though it is not the engine as such that is harmful to the climate, but only the fossil fuels powering the engines.
Whether this really marks the end of the piston engine in Europe remains to be seen. Because even after 2035, car manufacturers will still have the option of bringing passenger cars onto the European market that are equipped with an internal combustion engine. The prerequisite, however, is that these cars must be fuelled exclusively with eFuels, i.e. with synthetic and CO2-neutral fuels (vehicle category “eFuels only”).
Thus, what does this mean? The fact that this compromise was reached at all is first of all, an important negotiating success by the Federal Government, a compromise which protects Germany as an automotive location, at least temporarily. The manufacturers are now required to integrate a corresponding shut-off device in the vehicles, which ensures that the engine no longer starts if the vehicle is refuelled with a fossil fuel. Technically, this is certainly feasible.
However, the decision by itself is highly questionable in terms of regulatory policy. With the end of the internal combustion engine, the EU Commission has in fact set the course for electromobility. The reduction of fleet limits to zero grams of CO2 obviously serves the goal of accelerating the market penetration of electric vehicles. What the market is unable to achieve for various reasons, for example because consumers have other preferences or because battery electric vehicles are not competitive under market conditions, has once again been forced through state intervention. Moreover, it is also ecologically questionable, because the eco-balance of e-vehicles – related to the entire value chain (“well-to-wheel”) – is far from climate-neutral.
Instead, it would have been more ecologically and climate-friendly if the EU Commission had not focussed on new registrations, but had looked at the existing fleet of vehicles – after all, there are 350 million in Europe.
This would have led to direct emission reductions. Specifically, targets for the substitution of fossil fuels with eFuels or higher quotas for their admixture in fossil fuels would have been a feasible path.
But eFuels are always hastily pushed into the background in the political debate because the critics’ central arguments are not questioned. These are: (1) The production capacities of synthetic fuels are far from sufficient to meet potential demand. (2) A litre of eFuels currently costs the end consumer 4.50 euros and thus about three times as much as a litre of petrol. The use of synthetic fuels is therefore not economically viable. (3) The production of eFuels is not climate neutral and not efficient.
We should counter this: We need to rethink fuels – ideology-free, fact-based and visionary! As far as the currently still too low production capacities of eFuels are concerned, politics should adapt the funding framework in the sense of technology openness and technology diversity – similar to the promotion of the ramp-up of battery technology and fuel cells – and thus accelerate eFuel production. This is because technology maturity needs scalability and scaling takes place in stages (planning, approval, construction and commissioning of the plants). And also along a learning curve. With the expansion of production capacities, production costs will fall and eFuels will then be affordable for the end consumer. Experts expect production costs to fall to a range of 1.61 to 1.99 euros per litre in 2025 and to values between 0.70 and 1.33 euros in 2050. The price of petrol is likely to be significantly higher by the middle of the century.
As far as the efficiency and life cycle assessment of fuel supply is concerned, this aspect must also be considered in a differentiated manner. It is true that the production of eFuels through power-to-liquid processes is very energy-intensive and the energy supply from renewable sources in Germany lags behind the energy demand for the production of the required quantities of eFuels. The production process also has a lower level of efficiency than the direct use of electric power in vehicles with battery-electric drive systems. However, this argument, which is repeatedly put forward by critics, does not help if the goal is also to decarbonise those areas of the transport sector that cannot be electrified or can only be electrified with difficulty. As far as the eco-balance is concerned, it would be much better if the production of eFuels took place at suitable locations with a high capacity factor, such as in Norway (hydropower), Argentina and Chile (wind power) or Morocco (solar energy). This will then be completely CO2-neutral.
There is also the social dimension: it should not be underestimated that the global value chain leads to a diversified energy supply and inevitably entails technology exports. As a result, this enables the development of local value creation and thus the creation of jobs in countries of the global South as well as the preservation of jobs in the German supply industry.
Moreover, eFuels are relatively easy to transport and store with the existing infrastructure (pipelines, refineries, tankers, filling stations). From an overall economic perspective, the high additional costs of the technology switch from the combustion engine to the electric drive would be eliminated and no further politically induced capital destruction would take place. The crucial point, however, is that e-fuels are the only way to directly reduce the emissions of the existing 1.4 billion vehicles worldwide. In this respect, they are one of many necessary elements for achieving the Paris climate protection goals. And thus, they do not come into conflict with the UN Sustainable Development Goals (SDGs), as would be feared from a radical switch to e-mobility.
In this context, the competent contributions by the experts from science and industry who appeared at the joint event of autoregion e.V. and IHK Saarland at the Porsche Centre Saarland in May regarding the topic “e-fuels – where is the journey heading?” were very impressive.
Let us therefore continue to discuss the future of mobility together, based on facts and free of ideology, and stand up for our automotive location Saarland with all our strength and a lot of passion! The Saarland Chamber of Commerce and Industry and autoregion e. V. will be happy to accompany you on this journey.
Author: Dr. Carsten Meier, Managing Director of the Saarland Chamber of Industry and Commerce and member of the board of autoregion e. V.
