Powerfuels: Call for dialogue on market development for electricity-based fuels


The Global Alliance Powerfuels, a cross-industry alliance of companies and associations, has called for dialogue on the development of a global market for electricity-based, renewable fuels.

According to a Global Alliance discussion paper, powerfuels, along with energy efficiency and the direct use of renewable energy, are a key contribution to achieving the climate targets agreed in the Paris Agreement.

The technology is ready for the market and could quickly become more efficient and cost-competitive through economies of scale.

In addition, it offers worldwide potential for the development of new markets and value chains.

Andreas Kuhlmann, spokesman for the Global Alliance Powerfuels said: “Powerfuels can be a missing link for energy transition and climate protection, because they can close the gap in reducing greenhouse gas emissions if energy efficiency and renewable electricity alone are not enough.

“To build a global market for powerfuels, we need to think bigger and act boldly. Climate change is urgent and success depends on innovations being developed, pilot projects being implemented and international cooperation being strengthened. With our discussion paper we want to advance the dialogue on this future topic in politics, business, science and society. Interested parties from all over the world are cordially invited to participate.”

Climate-neutral alternative to crude oil and natural gas in all sectors

According to the Global Alliance discussion paper, there are four main reasons for powerfuels’ importance for climate protection:

1. They offer a climate-neutral option for applications with no viable alternatives to fossil fuels.

2. They enable transport and trade of energy from wind and sun worldwide.

3. They can be stored for the long term and used flexibly in existing energy infrastructures. This can help to reduce the transformation costs of energy transition.

4. They can replace fossil energy sources in existing consumer equipment in the short term and thus significantly accelerate the reduction of greenhouse gas emissions.

According to study scenarios of the World Energy Council, the worldwide demand for powerfuels could reach 10,000 to over 40,000 terawatt hours in 2050. By way of comparison, global consumption of crude oil and natural gas amounted to around 90,000 terawatt hours in 2017. To ensure that the capacities are available in time, the Global Alliance suggests to build up the market for this technology now and to change the economic framework conditions. At the same time, the increase in energy efficiency and the direct use of renewable electricity must be further promoted.

Potential for suppliers, consumers and technology providers

Powerfuels offer new value creation potential for various countries and companies. Countries that have been heavily dependent on revenues from the export of crude oil and natural gas can use powerfuels to develop a sustainable export alternative. At the same time, countries with good solar and wind conditions have the opportunity to enter the global energy market. Examples include Chile, Morocco and South Africa.

With powerfuels, consumer countries can achieve their climate targets, diversify their energy supply and implement their energy transition more flexibly. Pioneers are primarily industrialized regions with high energy demand and high greenhouse gas emissions, such as the EU, the USA, Canada, Japan and China. Japan has already strongly focused its energy policy on hydrogen. Powerfuels open up a new future market for suppliers of technologies and know-how. Germany, for example, has high technological and economic potential and has built the largest number of pilot plants to date.

The discussion paper “Powerfuels: A missing link to a successful global energy transition. Current state of technologies, markets, and politics – and start of a global dialogue” as well as further information on the Global Alliance and the opportunity to participate in the dialogue can be found at www.powerfuels.org.

About Global Alliance Powerfuels

Powerfuels are gaseous or liquid fuels generated from renewable energy sources such as wind or solar power. The renewable electricity drives an electrolysis process that produces hydrogen from water. The hydrogen can either be used directly or further processed into energy sources that can replace conventional gas or oil as required, be it as fuel in transport or for heat and electricity generation or as raw material in the chemical industry. The conversion processes are known under terms such as power to gas and power to liquid.

The founding members of the Global Alliance include Audi, Mitsubishi, Shell, Uniper and the German Energy Agency.