Global market for power-to-x creates an international win-win situation

Global market for power-to-x creates an international win-win situation

Meeting the climate protection targets set by the German government requires a large-scale use of renewable energies. Synthetic fuels from renewable energies (power-to-x) could play an important role in meeting these targets as they offer a number of advantages:

  • they are easy to store;
  • existing energy infrastructure can remain in use;
  • synthetic fuels have a higher energy density compared to electricity, and can thus be used in sectors like aviation;
  • importing synthetic fuels is relatively simple and facilitates a global trade of renewable power.

In a recent study (in German) on behalf of the Institute for Heat and Oil Technology (IWO), Mittelständische Energiewirtschaft Deutschland (MEW) and the Federal Association of Medium-Sized Mineral Oil Companies (UNITI) Frontier and the Institute for the German Economy (IW) analyses the impact an international power-to-x industry might have on the German economy and in power-to-x export regions. The study shows that in a global market for alternative fuels the German economy can assume the role of a technology and engineering know-how exporter.

Germany is already at the forefront of key technologies like the construction of electrolysers. In the long term building up a global power-to-x industry can generate value-added effects of 36.4 billion Euros per year and up to 470,000 new jobs. At the same time export countries will benefit from investments and value creation. This applies to emerging and developing economies, but also to countries that export large volumes of fossil energies.

Frontier regularly advises public and private clients on decarbonisation, energy transition issues, renewable energies and alternative fuels.

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