Reaching global net-zero by 2050 targets in the marine and aviation sectors will require large-scale e-fuel production. This IDTechEx article provides an explanation of the current e-fuel space.
An e-fuel (electrofuel) is a synthetic fuel made using green hydrogen from the electrolysis of water in combination with captured carbon dioxide. e-Fuels are compatible with existing infrastructure and are a drop-in replacement for fossil fuels. In the short-to-medium term, IDTechEx forecasts in its "Sustainable Biofuels & E-Fuels Market 2026-2036: Technologies, Players, Forecasts" report that demand for sustainable fuels will be mostly met by lower cost pathways (such as HEFA and other biofuel routes) instead of e-fuels. However, reaching global net-zero by 2050 targets in the marine and aviation sectors will require large-scale e-fuel production. Therefore, development of e-fuel technologies and scaling up of commercial projects is needed now.
e-Methanol is the leading e-fuel
In 2025, e-methanol production reached a new milestone, with Mitsui launching the "world's first commercial-scale e-methanol production" plant in Denmark in collaboration with European Energy. This Kassø e-methanol facility can produce 42,000 tonnes per annum of e-methanol. Consequently, e-methanol is now at a higher maturity than other e-fuels such as e-kerosene or e-methane. It can be used as a drop-in replacement for conventional methanol markets, and e-methanol is also desirable as a sustainable marine fuel. Additionally, global e-methanol production is forecasted to keep rising, with several 100,000 tonne per annum e-methanol plants reportedly already under construction, mostly in China.
China is already well established in the global methanol landscape; it's the world leader for conventional methanol production and consumption. Moreover, China is also the global leader in green hydrogen production (the key feedstock for e-fuels) - with several players such as PERIC and Sungrow now having over 3 GW in electrolyzer manufacturing capacity. e-Methanol production in China can therefore be used towards its own domestic decarbonization goals. It can alternatively be exported into the growing European market for low carbon methanol.
e-SAF: Waiting in the wings
While e-methanol is the most mature, there are also several key technologies being developed for e-SAF (sustainable aviation fuel). These include innovations in reverse water gas shift reactors/catalysts, alternative methods of syngas generation, and new Fischer-Tropsch reactor designs. For example, players such as Velocys and INERATEC have been commercializing microstructured/microchannel Fischer Tropsch reactors for compactness and high efficiency. UK-based OXCCU has developed a novel catalyst that can convert captured CO2 and green hydrogen into hydrocarbons in the jet fuel range using a single-step process. Other e-SAF project developers have ignored the syngas-Fischer Tropsch route entirely and focused on methanol-to-jet instead.
SAF production will become much more diverse post-2030 according to IDTechEx forecasts. Source: IDTechEx
Overall, most of the future e-fuel project pipeline is targeting either e-SAF or e-methanol. IDTechEx forecasts large-scale e-SAF production will start taking flight post-2030 in its "Sustainable Biofuels & E-Fuels Market 2026-2036: Technologies, Players, Forecasts" report.
What about e-methane?
For e-methane, both thermocatalytic and biocatalytic methanation production pathways have been commercialized at a relatively small scale. Most e-methane projects are tied to existing biogas/biomethane plants, as supplying green hydrogen in addition to the CH4/CO2 from anaerobic digestion can reportedly increase methane output by 60% compared to typical biogas upgrading. The largest e-methane plants currently operational produce around 1000 tonnes per year. However, project developers such as TES and Ren-Gas have plans for much larger facilities.
What about e-fuels for cars?
Electric cars beat e-fuels in terms of energy efficiency. However, most vehicles being sold worldwide still run on fossil fuels, demonstrating a need for e-diesel and e-gasoline as a drop-in replacement for full global decarbonization. The early e-fuel project frontrunners (such as HIF's Haru Oni and Infinium's Pathfinder) have mostly focused on e-fuels for road vehicles, suppling players such Porsche and Amazon that have voluntarily supported the development of low-carbon e-fuels.
Regulation will be the biggest driver for e-fuel growth. Given that electric vehicles are viewed as the ultimate green solution for cars, most regulatory support for e-fuels that exists is more geared towards the aviation and maritime sectors. Even so, technology pathways that produce SAF also produce renewable diesel as a byproduct, meaning e-diesel supply will also scale up as SAF demand grows. For example, INERATEC's e-fuel ERA ONE plant that came online in 2025 supplies e-diesel alongside e-kerosene.
Outlook
While it is true that e-fuel production is more expensive than alternative pathways such as HEFA/HVO or alcohol-to-jet, feedstocks restraints for biofuels means e-fuels will be needed in large volumes from the 2030s onward according to IDTechEx's "Sustainable Biofuels & E-Fuels Market 2026-2036: Technologies, Players, Forecasts" report. Regulation has begun to reflect this, especially in the EU and UK, with specific e-fuel sub-mandates. For example, under the ReFuelEU Aviation Regulation, at least 1.2% of all jet fuel supplied to EU airports must be e-kerosene by 2030, increasing to 35% by 2050. FuelEU Maritime has a similar 2% sub-target for renewable fuels of non-biological origin (RFNBO) starting in 2034. According to IDTechEx's forecasting, 9% of global SAF capacity could be e-SAF by 2036.
For more information on this report, including downloadable sample pages, please visit www.IDTechEx.com/Biofuels, or for the full portfolio of energy, decarbonization, and sustainability research available from IDTechEx, see www.IDTechEx.com.
