Hydrogen-based synthetic fuels need more policy support in Europe to drive wider development as they have been overshadowed by the move towards electrification, delegates heard at an energy and climate tech conference in Tokyo.

Hydrogen-based synthetic fuels are low-carbon or carbon-neutral alternatives to traditional petroleum-based fuels that are produced from CO₂ and green hydrogen. Also known as electrofuels, or efuels, they can be used as direct substitutes in existing fossil fuel infrastructure and internal combustion engines. They are targeted to supply 5.7pc of Europe’s transport sector by 2030 under the European Commission’s Renewable Energy Directive.

Efuels have struggled to build political backing as the momentum is to electrify where possible. But some countries will not be able to produce enough renewable power to underpin electrification of all sectors, according to Monika Griefahn, chair of the board of the Efuel Alliance, a European interest group for the industry.

“We cannot produce all of the energy yourself in your country. You cannot have 100pc renewable energy use in Germany for everything,” she said in a panel discussion at the Innovation for Cool Earth Forum.

20,000m³/hr – Tokyo Gas’s synthetic methane production target

Countries reliant on fossil fuel imports, such as Germany, should acknowledge they will remain energy importers for a time during the transition and embrace efuels accordingly, Griefahn adds.

“It is very logical that you still import fuels, but you import them from renewable sources. That has to be accepted by the political system, and you need some framework that incentivises the companies to really invest. At the moment, they want to invest but do not know whether they can be successful in selling it,” she says.

The focus on electrified transport means efuels have not enjoyed the same level of policy support as electricity as a transport fuel to date. One longstanding issue is that efuels are often taxed as fossil fuels—which the industry considers unfair as it does not take into account their low-carbon status.

The Efuel Alliance has argued that the tax base for efuels and alternative fuels should be based on their carbon intensity to incentivise production.

“The tax situation is still unclear in some countries. In Germany for instance, efuels are treated as if [they] were a fossil fuel. We have to change this [and] I hope other countries also give input to change it, because it is unfair,” says Griefahn.

Japan considers synthetic methane

Tokyo Gas—Japan’s biggest city gas supplier—is focusing its decarbonisation efforts on synthetic methane, a type of efuel, but there is concern it may not be recognised as a carbon-neutral fuel in the future, according to Yakabe Hisataka, director of hydrogen and carbon management at the Japanese utility. This would limit its ability to be traded.

In March, Tokyo Gas launched a small-scale demonstration of synthetic methane at its facilities in Yokohama with a capacity of 12.5m³/hr. The pilot aims to test existing technologies for the production process and acquire the knowledge to develop bigger projects.

The company will then scale up to a mid-sized project of around 500m³/hr later this decade that will see synthetic methane injected into the gas grid for use by industries and bulk gas users. The long-term goal is to establish a large-scale overseas supply chain that can generate 20,000m³/hr—equivalent to 1-2GW of power.

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Author: Shi Weijun