Global trading of renewable electricity-based fuels and chemicals to enhance the energy transition across all sectors towards sustainability

Abstract

Renewable electricity-based fuels and chemicals are expected to play an ever-growing role in future sustainable energy systems. e-Fuels and e-chemicals are crucial for the defossilisation of hard-to-abate segments in long-distance aviation and marine, as well as industrial feedstocks. This study evaluates the role of e-fuels and e-chemicals in a global energy system transition from 2030 to 2050 by analysing the demand for these fuels, potential for production, and costs. Furthermore, the global trading potential of e-fuels and corresponding benefits are assessed. The wide availability of renewable resources enables the diversification of energy markets compared to the current concentrated fossil fuels trade, leading to lower volumes of traded e-products than currently traded volumes of fossil fuels. South America, sub-Saharan Africa, and Middle East and North Africa regions emerge as important exporters of e-fuels and e-chemicals. This study estimates that 23–32% of the total demand will be traded, depending on the type of e-fuel and e-chemical. Results indicate that global trade will reduce the global average levelised cost of e-fuels and e-chemicals by 4.4–6.8% in 2050, with some regions yielding a reduction of up to 38% compared to a self-supply scenario. Globally, the trading of e-fuels and e-chemicals is estimated to reduce total energy costs by 136 b€ annually. The risk of supply disruptions to importers can be mitigated with diversified portfolio strategies combining different exporting regions. Global trade benefits both importers, as the costs of e-fuels and e-chemicals are reduced, and exporters that benefit from additional income, employment, and tax revenues.