On February 7, 2025, the Forum Ökologisch-Soziale Marktwirtschaft (FÖS) published a paper titled “E-Fuels and Their Limits – No Alternative to the Phase-Out of Combustion Engines” on behalf of the Klima-Allianz Deutschland. The paper caused quite an uproar among the industry. Today, UNITI, the German Federal Energy SMEs registered association, heavily criticized it. Ideology-based lobbying publications disguised as research studies were identified as an important obstacle to upscaling the Power-to-X production during the World Café as part of the last SPIN DAY and thus an obstacle to speeding up climate protection. To uncover them was seen as a strategically relevant task (read our report). Here we are having an example, as uncovered by Unity:
The paper argues against the role of e-fuels in the transportation sector, but a closer look reveals that many of its key claims do not withstand technical scrutiny. Notably, both organizations are financially supported by the German Federal Ministry for Economic Affairs and Climate Action, which opposes the use of e-fuels in road transport. This raises concerns about whether the conclusions of the paper are driven more by political preferences than by scientific analysis.
The Role of E-Fuels in a Defossilized Future
E-fuels provide a viable way to transport renewable energy from wind- and solar-rich regions to countries with limited green electricity potential, such as Germany. As renewable liquid fuels, they offer an essential pathway for reducing fossil fuel dependency in existing combustion engine vehicles, which still make up about 98% of the EU’s car fleet. However, despite their potential, regulatory frameworks at both the European and national levels favor battery-electric vehicles (BEVs) while largely ignoring e-fuels. This bias is evident in:
• The European Commission’s continued reluctance to allow new combustion engine vehicles running on renewable fuels beyond 2035.
• The CO₂ fleet regulations for passenger cars and trucks, which classify BEVs as zero-emission vehicles without considering their full life-cycle emissions.
By neglecting renewable fuels, policymakers risk excluding approximately 250 million combustion-engine vehicles across Europe from climate protection measures. Meanwhile, electric vehicles (EVs) come with high upfront costs, and public charging remains expensive, raising concerns about the affordability of mobility.
Key Misconceptions in the FÖS Paper
An in-depth review of the FÖS paper highlights several problematic assumptions and misleading conclusions:
1. Underestimation of E-Fuel Potential:
• The FÖS relies on studies that assume a near-total electrification of private transport by 2045 or a drastic reduction in the vehicle fleet. However, given the slow adoption rate of EVs and the existing fleet structure, these projections appear unrealistic without extreme policy interventions.
2. Flawed Energy Efficiency Comparisons:
• The analysis focuses on e-fuels produced in Germany, disregarding the global potential for their production in regions with abundant renewable energy. When comparing overall energy efficiency—including production and use—combustion engine vehicles running on e-fuels can perform similarly to BEVs when the fuels are produced in optimal locations.
3. Misrepresentation of Global Production Potential:
• The FÖS estimates a global e-fuel production potential of 54,800 TWh per year. However, the PtX Atlas from Fraunhofer IEE suggests a potential of up to 87,000 TWh—far exceeding the current global demand of approximately 30,000 TWh for transport fuels.
4. Outdated Cost Estimates:
• Instead of referencing the latest production cost forecasts by Frontier Economics, the paper calculates end-user prices based on an outdated tax scenario. It also ignores the European Commission’s proposed energy tax reform, which sets significantly lower tax rates for renewable fuels.
5. Incorrect Claims About Availability:
• The FÖS suggests that no large-scale e-fuel projects currently exist, citing the SAF Monitor by NOW GmbH. However, this source tracks only sustainable aviation fuels (SAF), not road transport fuels. With supportive policies, e-fuels could replace conventional gasoline by 2037 and diesel by 2043 in Europe.
6. Exaggerated Concerns About Pollutant Emissions:
• Contrary to the FÖS’s claims, ADAC testing has shown that e-fuels produce minimal pollutant emissions, well below regulatory limits.
A Politicized Debate at the Expense of Innovation
According to Elmar Kühn, Managing Director of UNITI, the FÖS paper lacks the depth and neutrality required for a serious policy discussion. He argues that it serves as a “smokescreen” in the debate over e-fuels and combustion engines, aligning with the ideological stance of certain political groups during an election year. Furthermore, the continued use of public funds to support organizations that act as political allies to ministries should be critically reassessed.
Conclusion
A technologically open approach, based on electrification and e-fuels when and where electrification is not (fast enough) possible, logically brings emissions down faster than an approach based on only one of the two options. The discussion around e-fuels should – like any discussion on important decisions – be guided by facts rather than political agendas. With the right regulatory framework, e-fuels could play a crucial role in defossilizing road transport without competing BEVs. Dismissing them prematurely in favor of a single technology approach risks slowing down the transition to a more sustainable transport sector and moreover it puts us at risk to lose the race against fossil emissions.
(Personal remark: by the way, what the criticized paper completely ignores is the fact that there are ways to produce e-fuels without electricity, like Synhelion’s technology. In that case the efficiency of using electricity is totally irrelevant. Because electricity is not needed.)