Synthetic Fuel Might Fail Due To Lack Of Support

Sep. 18, 2023 12:39 PM ET by Gerhard Horn Government / 14 Comments

The world appears to be content with electricity.

Synthetic fuel took a giant knock recently as Germany's transport minister failed to secure enough support from his global counterparts. According to Politico, Transport Minister Volker Wissing was hoping to use the recent IAA Mobility/Munich Motor Show to create some hype around synthetic fuel.

Wissing had hoped to create a declaration of support for synthetic fuels as another means of cutting emissions. A recent study conducted by Stellantis and oil giant Aramco found that using synthetic fuel could reduce carbon dioxide emissions from existing combustion engines by as much as 70%.

Rather disappointingly, Wissing only received the support of three countries: the Czech Republic, Japan, and Morocco. Apparently, this was due to disagreements with the wording used.

Politico obtained a draft of the document, and it required those who put their John Hancock on it to invest in new e-fuels, share knowledge, and defend "technological neutrality." In short, Wissing wants everyone to play along to save internal combustion and to agree that battery-electric vehicles aren't the only long-term solution.

The document also pointed to positive developments in the Global South, which is a term used to describe less developed or underdeveloped countries in the southern hemisphere. "Mass production will enjoy particularly favorable conditions in places with low wind and solar electricity production costs," the document read. For the record, Porsche's synthetic fuel partner started producing Punta Arenas, Chile. The location was chosen specifically because it has high winds 270 days of the year, which means Porsche's synthetic fuel is made entirely from renewable energy.

Basically, you can run a Porsche 911 GT3 RS guilt-free. Or at least a lot less guiltily than the average EV.

According to sources in the know, Wissing dropped his efforts but made a statement with his counterpart from the Czech Republic. "A successful market ramp-up of e-fuels requires comprehensive political support - worldwide," said Wissing.

Thankfully, Germany and Italy (and other EU members) only signed the EU's combustion ban once the politicians made room for synthetic fuel. They won the battle but with a caveat. ICE vehicles would only be allowed to continue if they can fill up exclusively with CO₂-neutral fuels.

Despite this massive setback, great strides are being made. HIF, Porsche's synthetic fuel partner, is building the first industrial-scale synthetic fuel facility in the USA, which will be operational in 2027. HIF also intends to set up shop in Asia Pacific and Europe. But we can't rely on a singular provider, and the closest thing we currently have is Aramco (Saudi Arabia) committing to two demonstration plants to explore whether it's a viable solution.

Our Take

The European Union consists of Austria, Belgium, Bulgaria, Croatia, the Republic of Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.

Most of these countries produce cars. Heck, some of them are synonymous with cars. Italy builds the finest supercars, and Bugattis are made in France. Belgium is home to one of the most iconic racing tracks in the world.

Is it a case of not wanting to share intel? We don't think so. There are hundreds of agreements across the globe, allowing automakers to cut costs by sharing. Almost everyone has a finger in China's pie.

Or has the automotive industry just accepted defeat in the face of EV-obsessed politicians? We hope not because politicians only last four years. Combustion has been around for more than a hundred.

We suspect this discussion is far from over, but the longer the world takes to reach a resolution, the more the future of combustion is in doubt.