Cristina Leon Vera | 19/02/2026
The so-called e-fuels, currently in development, could represent a significant reduction in CO2 emissions. However, large amounts of this gas are required for their production, in addition to water.
The journey towards more sustainable energy sources is long and has multiple paths. One of them proposes replacing the current fossil fuels with artificially produced fuels that emit much less CO2 during their combustion. They are the so-called synthetic fuels, whose research and development has been underway for several years. Although their main advantage is that they can be used in current combustion engines without the need for modifications, they also present numerous rough edges to be smoothed out before becoming a viable alternative.
One of the drawbacks is its high production cost. Although the process is simple to explain, it is costly to execute. To produce e-fuels, two main raw materials are used: water and CO2. The process consists of four phases:
- Hydrogen production: This is carried out through an electrolysis process that separates oxygen and hydrogen from water. This operation needs a large amount of energy, which comes from a renewable source, such as solar or wind.
- Obtaining CO2: It can be extracted directly from the atmosphere—a technique that is still very costly—or recycled from the emissions of other industrial processes.
- Chemical synthesis: Hydrogen and CO₂ combine through processes such as Fischer-Tropsch synthesis to form synthetic hydrocarbons, both liquid and gaseous (e.g., methanol).
- Refining: Finally, the product is refined to create specific fuels, such as synthetic gasoline (e-gasoline) or synthetic diesel (e-diesel).
If we analyze this process, the advantages of using synthetic fuels become clear. They are suitable for sectors that are difficult to electrify, such as aviation or maritime transport; their carbon footprint is nearly neutral, as they use clean energy in their production and reuse CO₂ from other industries; and, above all, they are compatible with the current vehicle fleet and the existing network of gas stations, addressing one of the major challenges of electrification.
But not everything is as promising as it seems. In practice, the synthetic fuel production model still faces multiple challenges that must be resolved for this option to become a viable alternative.
Punta Arenas (Chile), the pilot to follow in this race
These obstacles have already become evident in the ambitious pilot project deployed by Porsche and Siemens Energy in Punta Arenas (Chile), alongside the local company HIF Global. There, two of the most relevant German industrial companies have invested seriously in synthetic fuels as part of their R&D strategy. In 2023, they inaugurated a large-scale pilot plant intended for the production of e-fuels. Porsche uses them in their competition vehicles, with the aim of assessing their long-term viability in commercial cars. The initial goal is to produce 130,000 liters of e-fuel, with the aim of scaling up to 55 million liters.
The plant, called Haru Oni—which means “land of winds”—is located at one of the southernmost points of the Andean country, precisely in search of wind. It is an ideal place to install Siemens Energy wind turbines, capable of providing the energy needed for low-cost green hydrogen production, thanks to this abundant natural resource. Water supply is also not an issue in the region, which is located in a glacier area and at the confluence of three oceans (Pacific, Atlantic, and Antarctic). If necessary, a desalination plant could meet the water needs. However, in other locations, the high demand for water—an essential resource—could become a significant limitation.
The first major hurdle lies in obtaining CO₂. Currently, carbon dioxide produced by a brewery and other industrial facilities is used, since direct capture of atmospheric CO₂ remains technologically complex and economically unfeasible. If production is scaled up significantly (Haru Oni’s ultimate goal is to reach 550 million liters of e-fuel), the demand for CO₂ could exceed local availability.
But the biggest challenge of the project is transporting the fuel once produced. Being located in such a remote place, transporting thousands or millions of liters to Europe, Asia, and the rest of the Americas requires shipping, which on one hand greatly increases the cost at the destination and on the other hand undermines the zero-emissions goal, since these cargo ships still use fossil fuels.
This gives rise to the first paradox: to deliver clean energy to the final destination, it is still necessary to use polluting energy in transportation, which is environmentally counterproductive.
The second paradox is even more complex: if a massive adoption of these fuels were achieved, we would have an industry dedicated to reducing CO₂ emissions, yet dependent on that same CO₂ as a raw material. This implies that, at least in certain areas, carbon-emitting industries would still be necessary to feed the e-fuel production cycle. For now, the project in Chile continues to progress, has brought significant economic benefits to the region, and serves as a global testing ground. Time will tell whether synthetic fuels become a fully established alternative or remain a complementary option in the future energy mix.
