The Pathway - Clean Fuels for All

A pathway to climate neutrality

We, EU Fuel Manufacturers, have developed a potential pathway showing how we can contribute to reaching climate neutrality in the European Union by 2050.

We demonstrate how low-carbon liquid fuels can decarbonise transport, enabling all new and old road transport vehicles to be climate neutral by 2050, and securing the availability of these fuels for the aviation and maritime sectors.

Based on the work of our industry to date, we are ready to hit the ground running.

This pathway will require an estimated €30 to €40 billion investment between 2020 and 2030, including the creation of advanced biofuel and e-fuel plants, increasing the production of low-carbon liquid fuels up to 30 Mtoe/y in 2030. Major investments could start in the next years, with first-of-a-kind biomass-to-liquid and e-fuel plants coming into operation at an industrial scale no later than 2025.

By 2050, the total investment needed is estimated between €400 and €650 billion, enabling the availability of 150 Mtoe of low-carbon liquid fuels.

Add Carbon Capture Storage (CCS) for the capture of emissions in low carbon fuels production, and, in combination with electrification and hydrogen technologies, the transport sector could reach near climate neutrality.

Our pathway is ambitious. The good news is our transformation has already begun. Our success will however depend on broad multi-stakeholder partnerships and investor confidence, as well as on political vision. We need everyone on board.

With low-carbon liquid fuels, EU Fuel Manufactures are ready to contribute to climate-neutral transport.

Read our pathway

Scientific and technology background

This pathway was developed by Concawe, the fuel manufacturing industry’s scientific and technical body, as part of a series of studies under the Low Carbon Pathways programme. This programme aims at exploring the potential, both in quantitative terms and over a reference timeline, of the production of low-carbon liquid fuels until 2050, their effective contribution to the decarbonisation of transport and the scale and cost of the required industry transformation.

The assessment carried out by Concawe is using the European Commission’s Communication ‘A Clean Planet for All’, and more specifically the 1.5°C TECH scenario, as a reference for 2050. Aligned with the EU’s Paris Agreement commitments, this ambitious scenario achieves climate neutrality in 2050.

The assessment also:
• Investigates opportunities to achieve significant reductions in the carbon intensity of future low-carbon fuels, compared to a 100% fossil fuel reference, from the production to the end-use stage following a Well-to-Wheel (WTW) approach.

• Evaluates the potential deployment of the most promising technologies starting today and towards 2050, with a focus on sustainable food-crop-based biofuels, biomass & waste-to-liquid (BTL), hydrogenation of vegetable oils/waste & residues, and e-fuel technologies, with a view to replace fossil CO₂ by either biogenic (potentially including Direct Air Capture) or recycled CO₂ from industrial sites.

• Includes other key mitigation technologies (key enablers) such as Carbon Capture and Storage (CCS) and Clean Hydrogen applied in refineries to reduce the carbon intensity of produced fuels as from today, and with clear synergies with alternative feedstocks.

• Considers investment levels as best estimate of the order of magnitude of technologies still in development.

As a result of the above methodology and based on the European Commission’s plans, as well as on the accelerated development and scaling-up of the low-carbon fuel technologies identified, we estimated the amount of liquid fuels required and potentially available by 2035 and beyond.

Sufficient feedstock to support an ambitious low-carbon liquid fuels strategy

The potential availability of sustainable biomass is more than enough to allow advanced and waste-based biofuel to contribute, together with e-fuels, to the decarbonisation of EU transport in line with the 2050 climate neutrality objective. This is the conclusion of an Imperial College London Consultants study commissioned by Concawe.

After allocation of biomass feedstock to bio-based products and power, industry and residential sectors, based on the European Commission’s estimate, the total share of biomass available for transport in 2050 is estimated sufficient to support the production of up to 135 Mtoe of biofuels. Considering biomass imports to the EU, the production capacity could reach up to 175 Mtoe.

The biomass sustainability criteria applied by experts from Imperial College London Consultants are those defined by the Commission under RED II, and traditional biofuel crops (first generation) are not included.

Moreover, biodiversity has also been carefully considered in the study. Based on two key principles, conservation of land with significant biodiversity values and land management without negative effects on biodiversity, the study concludes that the available feedstock will have no negative effect on biodiversity.Together with electrification and hydrogen, low-carbon liquid fuels will enable EU transport to reach its 2050 objective without leaving anybody behind. Find more about the study here.

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What do you need to get started?

To invest beyond existing pilot plants and start building commercial operating plants at scale, we need clear legislative signals that will create market incentives to spur investor confidence.

When do you have to start to get the first unit of low-carbon liquid fuels ready?

We should start soon, so that the first-of-a-kind plant at industrial scale starts producing low-carbon liquid fuels by 2025. Covid-19 has had a dramatic effect on the global economy and on our own industry. Capital expenditures are impacted, and investors’ confidence is low. However, climate action remains an urgent challenge and, as we move into the recovery phase, it is essential that policymakers enable a conducive environment for investors, bringing stability and confidence into the market.

Why do you start by road transport?

Collectively, we first need to create a market for low-carbon liquid fuels. Road transport is for the time being the only transport mode where this is feasible, since the sector is heavily regulated and significant price signals exist. This lead-market will enable economies of scale and technology development, allowing low-carbon liquid fuels to become competitive. Only then can we address aviation and shipping.

Who will finance the scaling-up of the necessary technologies?

The role of investors to support the development of disruptive low-carbon technologies, notably on a large scale, will be essential. However, investors will only commit their resources should there be a reasonable expectation of a business case and prospects for a profitable market. Critical to this will be regulatory certainty and economic stability. Financing could come from FuelsEurope’s member companies as well as other investors, such as user groups and feedstock value chains or alliances.

Where will the plants be developed?

Plants are expected to be built closer to where feedstock production facilities are – e.g. forestry, windfarms and solar panel farms. As such, regional characteristics will influence where the technologies will be deployed. Plants could be of a relatively smaller size but spread out across Europe. We anticipate a focus on biomass in Eastern and Northern Europe, wind in coastal countries, sun in the Southern Member States, and waste recycling units closer to urban areas.

Why are low-carbon fuels not zero-carbon fuels?

Low-carbon liquid fuels produced from new feedstock such as biomass, renewables, waste and captured CO₂ will be close to zero CO₂ content. However, even if they reduce their CO₂ intensity, these fuels cannot be labelled as such during the transition, as they will be first blended with fossil fuels.

Why can we not supply all of the available low-carbon fuels directly to aviation and maritime transport?

The fuels used in aviation and maritime transport are currently almost exempt from any form of taxation. Should low-carbon liquid fuels be deployed now, they would not be able to compete vis-à-vis petrol-based fuels, due to their higher price and a lack of strong regulation. The creation of a market for low-carbon liquid fuels is hence essential to enable the availability of the products, increase their volume and subsequently lower their price. Further incentivisation schemes could facilitate a competitive penetration of low-carbon liquid fuels in EU-only flights.

What does a reduction of 100 Mt CO₂/year in 2035 mean?

This is equivalent to 50 million battery electric vehicles on the road. We have extrapolated for 2035 the total emissions from the European Commission’s ‘Clean Planet for All’ 1.5 Tech scenario. The result indicates that the level of total transport emissions for 2035 will amount close to 500Mt CO₂/year – the baseline scenario being +/- 700 Mt CO₂/year – and could be reduced by 100Mt CO₂/year, to amount to 400Mt CO₂/year.

What is the contribution of the value chain to your pathway?

Our pathway contributes not only to transport fuels, but also to the feedstock for the petrochemical industry. The refining industry is part of various value chains, notably transport and chemicals, but low-carbon liquid fuels will trigger the creation of new value chains, such as biomass and forestry. The contribution of these value chains is critical, so that we will substantially rely on partnerships.

What will the vehicle park consist of in 2050?

Extremely efficient internal combustion engine and electric vehicles will populate European roads 30 years from now. In 2050, all road vehicles should enable road transport to achieve climate neutrality. With climate-neutral liquid fuels and 100% renewable electricity, this combined technology fleet can be climate neutral.

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A pathway to climate neutrality

Scientific and technology background

Sufficient feedstock to support an ambitious low-carbon liquid fuels strategy

Want to know more?

Not enough? Check our low-carbon liquid fuels’ myth-busters and read our complete FAQ.