The Audi e-gas plant in Werlte, Germany, is the largest facility to produce synthetic methane from CO2 and hydrogen generated from renewable electricity. The facility began operations in 2013 and has a rated output capacity of around 1 kt/yr. It obtains around 2.8 kt of CO2 per year from the exhaust gas of a biomethane plant in the immediate vicinity. By feeding the synthetic methane into the local gas grid, renewable energy is chemically stored and CO2 emissions from displaced natural gas are avoided (Audi, 2019).

The largest CO2-based fuel plant in operation today is the George Olah Renewable Methanol facility located in Svartsengi, Iceland. The facility, built by CRI in 2012, converts around 5.6 kt of CO2 per year into methanol using electrolytic hydrogen. The required energy comes from the Icelandic grid, which provides electricity generated from hydro and geothermal sources. The CO2 is imported from a geothermal power plant located nearby, where it is a by-product of steam extracted from geothermal reservoirs which would otherwise be vented into the atmosphere. In 2015, CRI expanded its original output capacity of 1 000 tonnes per year to more than 4 000 tonnes per year. The product, called “vulcanol”, is sold on the market in Iceland and abroad where it is blended with gasoline and used in the production of biodiesel. CRI claims that vulcanol reduces CO2 emissions by more than 90% compared to fossil fuels over the complete life cycle of the product (CRI, 2019). The CRI methanol facility is a good example of how lower-emission CO2-derived fuels or chemicals can be competitive in regions with ample and low-cost renewable energy and CO2.

Can CO2-derived fuels deliver climate benefits?

The CO2 footprint of CO2-derived fuels can vary significantly, depending mainly on the energy use, carbon intensity of the energy and the type of displaced product. The use of natural gasbased hydrogen (without CCS) and carbon-intensive electricity from the grid can result in higher life-cycle CO2 emissions for CO2-derived fuels compared to the conventional fossil fuel-based production routes (Al-Kalbani et al., 2016; Reiter and Lindorfer, 2015). To achieve climate benefits, the use of low-carbon energy is critical. In a best case scenario, assuming the use of low-carbon energy and zero energy requirements for CO2 capture and purification, GHG emissions reductions of 0.5 to 1.0 tonne CO2-eq per tonne methanol are possible for both the direct and indirect conversion pathways, which equate to a 74% to 93% reduction as compared to the conventional production route (Artz et al., 2018). Similarly, under ideal conditions, assuming the use of wind electricity and heat integration, GHG emissions reductions of 0.03 to 0.05 tonne CO2-eq per MWh methane were found, which equate to a 54% to 87% reduction as compared to the conventional production route (Artz et al., 2018).

CRI claims that its production plant in Iceland reduces carbon emissions by more than 90% compared to fossil fuels over the complete product life cycle, from extraction and production to end use (CRI, 2019). However, the underlying assumptions are not reported. Furthermore, these emissions reduction potentials pertain to the fuel substitution only; from an energy system’s perspective the maximum emissions reductions are 50% if the CO2 originates from fossil or industrial sources (see previous section).

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