Extremely abundant natural resources worldwide for e-fuels production

MGH Energy has carried out a study to estimate the global potential for the production of renewable synthetic fuels, and to identify the countries with the largest and most competitive primary resources.
These synthetic fuels or electro- fuels, also known as e-fuels, are produced from renewable or low-carbon electricity, carbon dioxide (CO₂) or nitrogen (N₂), and hydrogen from electrolysis. According to the International Energy Agency, by 2050, the hydrogen needed to produce e-fuels will be produced overwhelmingly (around 95%) from electricity of renewable origin, mainly wind and solar.
The cost of electricity represents around 50% to 70% of the cost of producing e-fuels. In order to find the locations where e-fuels production will be most competitive, it is therefore necessary to identify the areas with the greatest renewable energy resources.
The mapping of wind and solar regimes across the globe (Global Wind Atlas and Global Solar Atlas) makes it possible to determine which areas have the best potential, both wind (above 9m/s) and solar (above 2200 kWh/m²), for producing the most competitive e-fuels. That said, maritime areas and mountainous areas are not considered because, although they may have significant natural resources, their construction costs make them less competitive than the best- performing flat onshore areas. Finally, in the interests of competitiveness, our study targets the best financing conditions and has therefore not considered countries where the risk premium is too high (above 10% – source Damodaran Online Data).

On this basis, we assessed the global potential for e-fuels production, and identified the geographical areas with the largest and most competitive avaliable resources. This potential was then compared with the needs of maritime transport or those of air transport. In this study, we have considered the process characteristics of the e-methanol production or e-kerosene production, although the results presented could be extrapolated to other synthetic fuels (e-ammonia, e-gas oil, e-GNL, etc.).

We have estimated that the global potential for e-fuel production is 3,500 Mtoe of e-methanol per year or 2,800 Mtoe of e-kerosene per year.

This production is equivalent to 13.5 times the current global needs of maritime transport or 7.5 times those of air transport.

We can therefore conclude that the world’s potential for e-fuels production is very important, both for shipping and air transport, especially when compared with the potential of biofuels, which is limited by the

availability of biomass. This abundant e-fuels resource would be able to decarbonize all air and maritime transport, which justifies the efforts being made worldwide to develop them.

The geographical analysis of the potential for e-fuel production shows strong disparities, particularly between Europe, which is poor in natural resources, and other countries that have considerable wind and solar resources, such as Chile, Australia, Colombia, Namibia and Morocco. These disparities should lead to a potentially decisive turning point in global energy policies and generate new international cooperation. A new era is dawning, and a hydrogen and e-fuel diplomacy is on the way. Some countries, such as Germany and South Korea, have already launched initiatives and partnerships with countries with the greatest natural resources in order to concretely support the development of this new market and secure part of their future supplies.

Morocco holds a privileged place in this new energy diplomacy thanks to its abundant renewable energy resources and its proximity to Europe. Our study shows that the Moroccan e-fuels production potential, alone, could meet almost 50% of the global needs to decarbonize all air and maritime transport combined.