It’s a term that seems far away, but it’s not. It is the gradual elimination of new vehicles with a combustion engine by the European Union from 2035.
Despite the regulation, the European Commission has agreed to propose a legal route to exempt cars running on e-fuels from the EU’s 2035 phase-out of new combustion engine vehicles.
The European Union’s plans have been stalled for weeks by Germany’s transport ministry, which asked for an exemption for vehicles with combustion engines and e-fuels. Berlin and Brussels reached an agreement on Friday.
For now, the two automakers that stand to benefit the most are Ferrari and Porsche, both planning future models to run on e-fuels. The commission will establish a new EU vehicle category for vehicles that run solely on e-fuels after EU member states agree to the 2035 phase-out regulation.
What does it mean in Maranello?
For Ferrari, it means the ability to maintain Ferrari’s traditional performance traits, while giving the automaker “more freedom in the production scheme,” Ferrari CEO Benedetto Vigna told Reuters. The company is already making plug-in hybrids, while its first all-electric car is slated for 2025. But being able to produce cars that run on e-fuels could help the automaker continue to produce its fire-breathing sports cars that they have their own unique roar, something that is difficult to achieve with a silent electric motor.
By 2030, Ferrari expects hybrid and fully electric vehicles to account for 80% of its model range, with internal combustion engines powering the remaining 20%.
Meanwhile, in Germany
The Volkswagen Group, which owns Porsche, remains committed to the electrification of its fleet, with electric vehicles expected to account for 10% of its sales by 2023.
Like Ferrari, Porsche envisions a future where carbon-neutral e-fuels power the internal combustion engines of its 911 sports car. To this end, Porsche has already begun production of e-fuels in a joint venture with Siemens at a plant Chile. In the pilot phase of the plant, around 130,000 liters (34,342 gallons) of e-fuel will be produced, eventually increasing to 550 million liters (145.3 million gallons) by 2026.
“Their advantages lie in their ease of application: e-fuels can be used in combustion engines and plug-in hybrids, and they can make use of the existing network of service stations,” said Oliver Blume, CEO of Porsche. “We have extensive technical experience. We know exactly what fuel characteristics our engines need to operate with minimal impact on the climate.”
In fact, in December, Porsche executives filled a Porsche 911 with the first synthetic fuel produced on site.
Porsche will begin using the fuel in its racing program and performance experience centers. Finally, the fuel will be sold to oil companies.
So what is e-fuel?
Synthetic fuels, also known as e-fuels, have the same fundamental chemical composition as conventional fuels used in internal combustion engines. But e-fuels use electricity from renewable sources to create synthetic methanol through a complex process involving water, hydrogen and carbon dioxide. The companies claim to be able to operate engines with almost CO2-neutral gas. Oil would still be needed for engine lubrication.
But here’s the catch.
It takes a lot of electricity to separate hydrogen from water and combine it with carbon to create synthetic fuel. At best, half of the energy in electricity is converted into fuels. A liter of e-fuel costs about $5 per liter to make today; that’s $18.93 a gallon. By 2030, that’s expected to drop to $3 a liter, but that’s still $11.36 a gallon.
But Porsche has put its money where its mouth is, making a $75 million investment in HIF Global LLC, an electric fuel startup with plans to build 12 e-fuel production facilities in Texas, Chile and Australia producing 150,000 barrels of fuel per day.
But consider that the United States consumes 8.8 million barrels of gasoline per day, and you can see the long-term challenge of e-fuels.
Still, it could prove to be a way for conventionally powered internal combustion engine cars to continue to be built without harming the environment.
“Porsche is betting on a double e path: electric mobility and electronic fuels as a complementary technology. Using eFuels reduces CO2 emissions,” said Barbara Frenkel, member of the Executive Board of Procurement at Porsche AG at the announcement of the plant in 2021.
“With the e-fuels pilot plant, Porsche is playing a leading role in this development.”
