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Glossary · Energy industry & energy transition

E-fuels, synthetic fuels

Term E-Fuels synthetic fuels power-to-X hydrogen CO2 mobility Industry air traffic

E-fuels are artificially produced fuels whose energy comes from electricity. Usually, hydrogen is first produced from water by electrolysis. This hydrogen is then processed with a carbon source, often captured CO₂, into gaseous or liquid hydrocarbons. Depending on the process, the results are synthetic methane, methanol, synthetic kerosene, diesel-like fuels or precursors for the chemical industry. In a broader sense, nitrogen-based derivatives such as ammonia are also counted. However, these contain no carbon and therefore do not need a CO₂ source.

Definition and classification

The term does not refer to a single fuel but to a production pathway. The "e" stands for electricity, i.e. electricity as the source energy. E-fuels belong to the larger family of Power-to-X, in which electricity is converted into another energy carrier or raw material. When a gas is produced, this is usually called power-to-gas; for liquid fuels, power-to-liquid. For liquid hydrocarbons such as kerosene or diesel, a synthesis gas is first produced from CO₂ and hydrogen and then processed further, for example by Fischer-Tropsch synthesis. A second route goes via methanol. The distinction matters because storage, transport, efficiency, infrastructure and subsequent use differ greatly depending on the product.

In EU law, electricity-based fuels are usually called "renewable fuels of non-biological origin" (RFNBO). This means liquid or gaseous fuels whose energy content comes from renewable sources other than biomass. The everyday term e-fuel is broader. Not every synthetic fuel meets the legal requirements for an RFNBO.

Distinction from related terms

  • Hydrogen: E-fuels are not the same as green hydrogen, even though it is usually their most important feedstock. Hydrogen can be used directly, for example in industrial processes, fuel cells or as a chemical raw material. E-fuels are only created through further conversion steps, each of which costs energy.

  • Biofuels: They are based on biomass such as vegetable oils, residues or fermented organic material. E-fuels are based on electricity, hydrogen and a separately supplied carbon source.

  • Synthetic does not mean climate-neutral: A synthetic fuel can also be produced with fossil-generated electricity and fossil CO₂. In that case the emission is merely shifted along the chain, and the balance can even be worse than for fossil fuel.

Energy density and efficiency

The key quantity is energy, usually given in kilowatt-hours or megajoules. Liquid e-fuels store a lot of energy per kilogram and per litre. This makes them interesting where weight, volume and range matter, for example in aviation or parts of shipping. However, high energy density does not mean high overall efficiency. Losses occur in electrolysis, in providing the CO₂ (especially when captured from the air), in synthesis, processing and transport, and finally in combustion. A car running on synthetic fuel therefore converts only a much smaller share of the electricity used into motion than a battery-electric vehicle. Depending on the study and assumptions, it is roughly several times less. The exact efficiency depends on the process, CO₂ source and heat use.

Climate impact: origin of electricity and carbon

For the climate impact, what matters is where the electricity and the carbon come from. If the hydrogen is produced with renewable electricity and the CO₂ comes from biogenic sources or directly from the air, combustion releases roughly as much CO₂ as was previously taken up. According to the ReFuelEU Regulation, synthetic aviation fuels made from renewable electricity and carbon captured directly from the air can save up to 100 percent of emissions compared with fossil kerosene. This is an upper limit. The actual saving depends on the whole chain, for example on electricity sourcing, the energy demand of CO₂ capture and transport. If the CO₂ comes from a fossil industrial process, its carbon is used a second time. This is not climate-neutral, because the fossil carbon ends up in the atmosphere anyway.

In the EU, Delegated Regulation (EU) 2023/1185 governs how the greenhouse gas savings of RFNBOs are calculated over the entire life cycle. For a fuel to qualify as an RFNBO, it must achieve savings of at least 70 percent compared with a fossil comparator of 94 g CO₂ equivalent per megajoule. In addition, Delegated Regulation (EU) 2023/1184 specifies when the electricity used counts as renewable. This includes requirements for additionality as well as temporal and geographical correlation (see additionality criterion for green hydrogen).

Significance for the electricity system

In the electricity system, e-fuels matter above all because they require a great deal of additional electricity. Electrolysers, CO₂ capture, synthesis plants and processing need electricity and heat. Production in large quantities therefore places new demands on the expansion of renewable energy, on power grids, water availability, sites and import relationships. The question is therefore not only whether a fuel can be produced technically. It is also about what quantities of electricity it ties up and what that electricity would otherwise have been used for.

Such plants can be useful for grid operation if they run flexibly. Electrolysers can in principle adjust their output to the electricity supply: they take up a lot of electricity when wind and solar power are plentiful, and throttle back during scarcity or grid bottlenecks. This flexibility has limits. Synthesis plants usually work better technically and economically at consistently high utilisation. Storage for hydrogen or intermediate products can decouple fluctuating electrolysis from further processing. Whether a plant relieves the grid therefore depends on location, mode of operation, storage size, grid connection and market rules.

Costs and regulation in the EU

Economically, e-fuels are shaped by high investment costs, a high share of electricity costs and conversion losses. The price depends heavily on cheap renewable electricity, the operating hours of the plants and the costs of CO₂ and transport. In the ReFuelEU Regulation, the EU estimated the production costs of synthetic aviation fuels at three to six times the market price of fossil kerosene. A market therefore emerges mainly through requirements: demand obligations, certification and proof rules, infrastructure, emissions trading and the question of who bears the costs.

  • Aviation (Regulation (EU) 2023/2405, ReFuelEU Aviation): Aviation fuel suppliers at EU airports must blend in rising minimum shares of sustainable aviation fuels (SAF). From 2030, it contains a separate minimum quota for synthetic aviation fuels: 1.2 percent on average over the years 2030 and 2031, at least 0.7 percent in each year. This quota rises to 5 percent from 2035, 10 percent from 2040, 15 percent from 2045 and 35 percent from 2050. The total SAF quota is then 70 percent.

  • Transport and industry (Renewable Energy Directive as amended by (EU) 2023/2413, often called RED III): Member States are to raise the share of RFNBOs in energy consumption in transport to at least 1 percent by 2030. In addition there is a combined target of 5.5 percent for RFNBOs and advanced biofuels. In industry, 42 percent of the hydrogen consumed in 2030 and 60 percent in 2035 are to be RFNBOs. Under certain conditions, reductions are possible. How the targets are implemented nationally differs between Member States.

  • Car fleet limits (Regulation (EU) 2019/631): The current version of 2023 requires a 100 percent CO₂ reduction for new cars from 2035, measured at the tailpipe. In December 2025, the Commission proposed lowering the target to 90 percent and introducing credits for, among other things, sustainable renewable fuels. The legislative procedure was still ongoing in November 2026. What legal role e-fuels will play for cars is therefore still open.

Common misconceptions

A common error is to see e-fuels simply as a continuation of today's combustion technology. Certain synthetic fuels can indeed be used as drop-in fuels in refineries, tank farms, pipelines, turbines or engines, provided they meet the standards and approvals. This compatibility is a real advantage. But it says nothing about the available quantity. What is scarce is not the engine, but renewable electricity, electrolysis capacity, suitable CO₂ and the industrial production chain.

A second error concerns local emissions. Even an e-fuel that is renewable on paper releases CO₂ at the tailpipe or engine on combustion. Depending on fuel quality and combustion technology, nitrogen oxides and particulates are also produced. Synthetic paraffinic fuels contain hardly any sulphur and aromatics and often burn more cleanly, but they are not pollutant-free. Climate balance, energy efficiency and air quality are separate evaluation criteria.

Sensible fields of application

Use in cars is particularly controversial. Battery-electric cars use electricity directly and need significantly less energy across the whole chain. E-fuels would route the same scarce renewable electricity through several conversion stages and thus multiply the demand for electricity generation. Technically this is possible. In the overall system, however, e-fuels thereby compete with applications for which there is hardly any direct electrification: international long-haul flights, parts of maritime shipping, the basic chemical industry and existing installations that cannot be converted quickly.

In aviation the situation is different. Batteries are hardly suitable for long distances because of their weight. Hydrogen aircraft need new aircraft concepts, tanks, airport technology and safety rules. Synthetic kerosene can continue to use existing turbines and logistics if quality and approval are right. That is why the EU has set its own quotas for it. In shipping, e-methanol, ammonia, other hydrogen derivatives and direct electrification compete on short routes and in ports.

Conclusion

Strictly speaking, e-fuels are electricity-based synthetic fuels. They are well suited to applications that are hard to electrify, but place high demands on renewable electricity, the carbon source and proof of compliance. Their strength lies where high energy density, existing fuel infrastructure and a lack of alternatives come together. Their weakness lies where electricity can be used directly without large losses. Anyone who describes e-fuels across the board as a solution or as a dead end overlooks these differences. Whether a use is sensible depends on efficiency, alternatives, scalability, emissions balance, infrastructure and opportunity costs.

Sources

Related glossary entries

Edited by eCMS on 11.11.2026 19:42

© 2026 Erik Schmidt. All rights reserved. Quotations with a link to the source are welcome.