What is synthetic fuel? artwork

What is synthetic fuel?

Do you really know?

July 13, 2026

For a number of years now, we’ve been hearing that the future of transport is electric, in particular due to the impact of fossil fuels on global warming.
Speakers: Bababam
**Bababam** (0:04)
What is Synthetic Fuel? Thanks for asking. All week long, we're looking at 10 new terms and concepts that are certain to be on everyone's lips in 2023
For a number of years now, we've been hearing that the future of transport is electric, in particular due to the impact of fossil fuels on global warming. But there are a number of drawbacks, including cost, battery life, battery recycling and charging time, which means some people are reluctant to get on board. There are also fears that the switch to electric vehicles won't be quick enough to meet environmental objectives. Some experts believe that the fastest way to reduce CO2 emissions from transport is to use fuels synthesized from organic materials that are carbon neutral and can power existing vehicles.
Some of the major players in the automotive industry are getting on board, including Porsche, who want 80% of their new sales to be all electric vehicles by 2030, with the other 20% running on synthetic fuels. It hopes to bring its e-fuel to market in 2023 How are synthetic fuels made? Up until recently, the idea of a carbon neutral combustion engine was pure fantasy, but synthetic fuels are a game changer. The manufacturing process actually captures CO2, meaning it's possible to make petrol or diesel powered cars carbon neutral, limiting their impact on global warming. Let's take a quick chemistry lesson. In simple terms, you take water and separate the hydrogen and oxygen which make it up. You keep the hydrogen, then trap the CO2 molecules that are contained in the air. You mix the filtered CO2 with hydrogen to create synthetic methanol, which is transformed into fuel to power cars. The process relies on electrolysis to split water into its component elements. That means a lot of electricity is required, which is why Porsche invested 20 million euros in creating a pilot plant in the Punta Arenas area of southern Chile. It's the windiest area in South America, and that force can be converted into electricity using wind turbines. The plant was officially opened in December 2022, and Porsche is aiming to produce 130,000 liters of synthetic fuel per year in its pilot phase, then ramping up to 55 million liters by the middle of the decade, and reaching 550 million liters two years after that.
Great, I'm heading to the petrol station to fill up on synthetic fuel. Not so fast. Synthetic fuel won't be available to the general public, at least not right away. Porsche will be using their e-fuel for racing cars first, before gradually extending its reach. Bear in mind it won't come cheap either. Porsche says that production costs will be $2 per liter, so we should expect a retail cost at least twice that much.
Another barrier is that synthetic fuel isn't even authorized in Europe yet. Many countries are preparing for bans on the sale of internal combustion vehicles, set for 2035 in the EU and 2030 in the UK. As of yet, no exemptions have been made for synthetic fuels, although that could change in the coming years. There you have it. Now you know what synthetic fuel is. In under three minutes, we answer your questions and help you understand the true meaning behind the trends, concepts and acronyms that are making headlines. Listen along and you will really know for sure.
Bababam.

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