The oil companies want to invest 40,000 million in a decade to ‘clean’ the fuel

The European oil companies, grouped in the FuelsEurope association, have today presented their Roadmap for transport to be carbon neutral by 2050, thanks to liquid fuels. In the shorter term, they are betting on investing 30,000 to 40,000 million euros before 2035, in order to avoid the same _CO2 emissions as 50 million electric vehicles annually.

Repsol’s project to produce clean fuels in the Petronor complex in Bilbao, after an investment of €60 million, is the latest in an already long series of actions at European refineries to achieve zero-carbon mobility by mid-century. FuelsEurope’s new strategy points to the developments of ENI in Sicily – valorising waste – BP in Hamburg to produce aviation fuel from green hydrogen – obtained with renewable energy – or Equinor, Shell and Total to confine and capture _CO2 emissions.

Based on these experiences, FuelsEurope estimates that an investment of 30,000 to 40,000 million is needed until 2030 to have an annual production capacity of clean fuels in the EU of 30 million tons of oil equivalent. Continuing the same trend, five years later, in 2035, ecological fuels consumed by internal combustion vehicles would avoid the same emissions as 50 million electric vehicles, about 100 million tons of _CO2 per year.

Among these green fuels, it lists first-generation biofuels -in which there will be no new investment-, hydrotreated vegetable oils, hydrogen, synthetic fuels and those produced from waste and lignocellulosic materials, which would receive the bulk of the investment, about 25,000 million.

According to its strategy, in line with that already presented by the Spanish oil companies almost a year ago, once road transport is massively using low-emission technologies, ecofuels would be applied to progressively decarbonise aviation and navigation, with a view to cutting up to 50% of CO emissions.₂ of both sectors by mid-century.

More than half a trillion of investment until 2050

The production of ecofuels for all transport, road, sea and air, will require an investment of 400,0000 to 650,000 million. By 2050, 150 million tons of ecofuels could be available annually, which would avoid the emission of 400 million tons of _CO2 per year. Approximately half of them would be lignocellulosics, while the other half would be provided by synthetic fuels and, to a lesser extent, hydrogen.

Total neutrality of carbon emissions in transport by mid-century would be achieved by capturing and confining carbon (CCS) from refining processes from non-fossil feedstocks to final fuels, i.e. CCS would reduce the total volume of CO₂ – it would account for negative emissions – because it would be applied in an already neutral process.

_{CO2 market} for transport and computation of the entire life cycle

To meet its roadmap, FuelsEurope calls for the creation of a market for clean fuels, with a clear carbon price signal, to facilitate investment. In road transport, this could be achieved through co-rights trading₂ -the system applied to electricity- or with legislation on carbon intensity throughout the life cycle -from the well to the wheel-, with fuel suppliers as obligated subjects and the possibility of establishing commercial credits between them.

The current accounting rules on _CO2 emitted by vehicles should also be amended, correcting the current tank-to-wheel approach, so that consumers know precisely the _CO2 intensity of their mobility options and facilitate the conversion of vehicle manufacturers.

Regulatory stability, the simplicity of European regulations and the application of a taxation that values carbon intensity would be other relevant measures, particularly the latter, because the exemption or reduction of taxes on ecofuels would achieve the double objective of keeping fuel prices affordable and favoring investments.

Renew the fleet of vehicles

AOP, the Spanish branch of FuelsEurope, puts the accent on another element: the renewal of vehicles, since Spain has one of the oldest car parks in Europe, with an average age of 12.7 years. Replacing one of these vehicles in circulation with a new one saves 30% of CO₂: “With much more efficient engines and much less emitters, the reduction of greenhouse gas emissions will not depend only on the penetration of the electric car,” says the refinery employer.

Source: The Economist