Synthetic fuels: a story of supply and demand

By Tom Cheesewright 11 Oct 24 Reading time: 4 mins

“Batteries are just a stop-gap technology. We’ll all be running our cars on synthetic fuel in a few years.”

I read something like this every week on social media. And I sigh. Because while synthetic fuels are absolutely part of our future, they are not the future for passenger cars.

What is meant by ‘synthetic’ fuels?

To explain why, first you must qualify what you mean by synthetic fuel. Taking the broadest definition, this means fuels with no fossil component – that is, they’re not derived from oil. There are a few ways to make fuels like this. 

First you can brew them from food. Bio-ethanol, the product of this process, is already a standard part of our fuels. It makes up anywhere from 5-85% of the stuff you put in your tank, depending on what you’re driving and where you are in the world. 

Second, you can make biodiesel out of vegetable oils. Ideally both processes are based on waste – either food waste or production residues. But the reality is that this makes the process more expensive, so typically a lot of biofuels come from specially grown biomass. And this is where you run into your first problem.

Growing food is a land-, water-, and energy-intensive process. With climate change disrupting crop productivity, there is already a lot of competition for land. Turn it over to fuel production, and both the food and the fuel become more expensive. And even if we decided that was worth it, we simply don’t have enough land in the right places to meet fuel demand.

How else can we make synthetic fuels?

Surely there are more sophisticated ways to make hydrocarbons? Well yes, we can mash hydrogen atoms together with carbon dioxide plucked from the air. An incredibly green process in theory. Except that we don’t yet have very efficient means to capture carbon (apart from photosynthesis – and then you’re back to growing plants), and nor do we have a good supply chain for “green” hydrogen. Both things will come, but the runway is longer than anyone would like.

Most of our hydrogen today is made from fossil fuels. Making “green” hydrogen by splitting water requires a lot of renewable energy. And we just don’t have enough at the right price. Even when we do, that old problem of efficiency returns. 

Extracting hydrogen from water is about 70-85% efficient today. There are technologies on the near horizon that might take this to 95%. But even then, you’re generating energy, to make hydrogen, to combine it with carbon, to then burn it in an engine that is only 30% efficient. The combined losses when compared to just sticking the electrons straight in your car are enormous.

Who will pay more for synthetic fuels?

Even if all those issues could be resolved though, there’s another problem: other industries have greater need for synthetic fuels.

The biggest demand for sustainable fuel comes from aviation. Right now, we produce 0.2% of the amount of SAF (sustainable aviation fuel) that we need to reduce the carbon emissions of aircraft – something the industry is committed to do. We’re a decade away from battery-powered passenger planes of any scale, so the airline industry is willing to pay more for a litre of aviation fuel than you want to pay for petrol. 

We will run cars on synthetic fuel. Classic cars. Race cars. But not family cars. Those will be electric, and powered by batteries, which are the most economically practically, scientifically viable option for the foreseeable future.

A note on battery power

For full transparency, I am an EV (electric vehicle) nerd. So much so that I built my own. Part research project, and part passion project. Building it, and progressively upgrading it, has taught me a few things about batteries. 

The first battery pack that I bought, second-hand, cost me £800 and gave me 7.6 kilowatt-hours (kWh), a measure of the amount of energy stored in the pack. The second pack that I bought – from a similar but more recent donor car – also cost me £800. But it gave me 12kWh. A quick scan of auction sites and I can now get 50kWh for £2,000. 

In the space of four years, the price per kilowatt-hour has gone from around £100 to around £40. Packs are not only cheaper, they are also more energy dense (more stored per kilogram), and power dense (more input/output capacity). The result is a rapid advancement in the range, cost, charging speed, and performance of EVs. Today you can buy a new EV with an approximately 200-mile range that charges in 26 minutes for £22,000. Imagine how much that will improve in another four years.

Tom Cheesewright / Guest writer

Tom Cheesewright is an applied futurist working with governments and global brands to help them to see the future more clearly and respond with innovation. He is the author of two books on foresight and the future, High Frequency Change, and Future-Proof Your Business, and a regular media commentator with thousands of contributions to TV and radio.