Technology readiness: Indirect use of clean electricity via synthetic fuels
Shipping
Current status of implementation and existing gaps
In the medium to long term, synthetic e-fuels such as methanol, ammonia and methane could significantly contribute to decarbonising the shipping sector. Ammonia is advantageous as it does not require a carbon source and can be produced where renewable power is available, though its toxicity presents operational challenges. Methanol, while safer to handle, relies on a renewable carbon source, making its large-scale production more difficult.
Examples and initiatives
More than 50 vessels currently operate on methanol. This number is expected to increase as the orders for vessels powered by synthetic fuels and feedstocks grow (DNV, n.d.a).
Aviation
Current status of implementation and existing gaps
Synthetic fuels are likely to play a significant role in the decarbonisation of aviation. In the medium term e-kerosene could be used and in the long term possibly green hydrogen. E-kerosene requires a biogenic carbon source, which makes the scalability of fuel production more challenging. The pipeline for synthetic fuels has been growing steadily. Currently, 56 projects are in the pipeline, with a total capacity of 2.5 Mt/year by 2030 (GENA Solutions Oy, 2025).
Examples and initiatives
SkyNRG and Skellefteå Kraft have announced plans to build a facility capable of producing 100 000 tonnes of e-SAF using biogenic CO2 and renewable electricity from wind and hydropower (SkyNRG, 2024).
Iron and steel
Current status of implementation and existing gaps
Hydrogen-based direct reduced iron (DRI) is close to commercial maturity and becoming widely accepted as an alternative technology within the iron and steel industry. According to IRENA’s project tracker, about 80 Mt of steel per year from hydrogen-based DRI could be produced in the near future.
Examples and initiatives
Successful examples include the pre-commercial demonstration of HYBRIT (Hydrogen Breakthrough Ironmaking Technology); construction of Stegra’s Boden site, with a planned capacity to produce 5 Mt/year of steel from hydrogen-based DRI, expected to be operational by 2026; and the launch of start-ups like Blastr, GravitHy and Hydnum Steel for hydrogen-based steelmaking (LeadIT, 2024a).
Chemical and petrochemical
Current status of implementation and existing gaps
The falling costs of renewable energy have allowed exploration of the use of green hydrogen to produce synthetic hydrocarbons through electrochemical processes. There have been several project announcements for chemical production through this route; however, the main barrier to widespread deployment is cheap, abundant and renewable CO2.
Examples and initiatives
As of March 2025, there are around 120 e-methanol projects in the pipeline, with a production capacity of about 20 Mt (GENA Solutions Oy, 2025).
Cement
Current status of implementation and existing gaps
Synthetic fuels and feedstocks such as hydrogen-based synthetic fuels and e-methanol are still in early research, pilot and pre-commercial demonstration phases. Producing synthetic fuels from hydrogen and captured CO2 requires large amounts of clean electricity, and the energy efficiency of synthetic fuel is still low, making widespread adoption difficult (WEF, 2024).
Examples and initiatives
Cemex and Synhelion are also exploring the integration of hydrogen and e-fuels to decarbonise cement kilns, including the possibility of using synthetic fuels (e.g. e-methanol) produced from hydrogen and CO2 (GCCA, 2024).
Enablers
Enablers (39)
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Policy and regulation
- 1 Sector-specific emission reduction targets
- 2 Carbon pricing mechanisms
- 3 Economic support for green commodities and fuels: Subsidies
- 4 Economic support for green commodities and fuels: Taxation
- 5 Economic support for green commodities and fuels: Carbon Contracts of difference
- 6 Demand stimulation policies: Green public procurement
- 7 Demand stimulation policies: Mandates and quotas
- 8 Demand stimulation policies: Emission reduction standards
- 9 Demand stimulation policies: Phase out of ICE Vehicles
- 10 Carbon limits in end products
- 11 Product definitions, standards, certification schemes and emission accounting frameworks
- 12 Fast-tracked permitting
- 13 Research and development support
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Technology infrastructure and system operation
- 14 Technology readiness: Reduced demand and improved energy efficiency
- 15 Technology readiness: Direct use of clean electricity
- 16 Technology readiness: Direct use of renewable heat and biomass
- 17 Technology readiness: Direct use of sustainably sourced biomass and biofuels
- 18 Technology readiness: Indirect use of clean electricity via synthetic fuels
- 19 Technology readiness: Implementation of CO2 capture, utilisation and removal measures
- 20 Physical infrastructure: Power grids modernisation and expansion
- 21 Physical infrastructure: Electric charging facilities for EVs
- 22 Physical infrastructure: Hydrogen networks
- 23 Physical infrastructure: CO2 capture and storage networks
- 24 Physical infrastructure: Ports and airports
- 25 Digital technologies and infrastructure
- 26 Quality infrastructure
- 27 Supply-side flexibility and demand-side management via smart electrification strategies
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Market conditions business and finance
- 28 Early market creation measures: Offtake agreements and long-term contracts
- 29 Early market creation measures: Industry coalitions
- 30 Early market creation measures: Emerging business models
- 31 Corporate climate commitments and transition plans
- 32 Ecolabels of green products
- 33 Sustainability-linked investments, climate bonds and sustainable finance taxonomies
- 34 Financing programmes and de-risking instruments
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Supply chain skills and community engagement