Liquid fuels based on renewable electricity (power-to-liquids or e-fuels) have an important role to play in contributing to greenhouse gas reduction in transport - especially in sectors where there is limited capacity to become fully electrified, such as shipping and aviation.
Although e-fuels are technically well researched and widely available, lack of economic viability is currently a barrier to industrial-scale production and market take-up.
Frontier Economics is currently working on a comprehensive study on behalf of Germany’s Ministry of Transport and Digital Infrastructure (BMVI) on the development of a support scheme for industrial-scale production of electricity-based liquid fuels (power-to-liquid, PtL) - in particular PtL paraffin. Renowned law firm, Freshfields Bruckhaus Deringer, is supporting Frontier from a legal standpoint and Nova Institute will provide technical expertise.
As part of the project, the Ministry has launched a market test today. With the call for non-binding project outlines, the Ministry intends to gather feedback from market participants. Based on the results, a binding competitive funding procedure is expected to start in early 2022. Frontier is advising the Ministry throughout this process.
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