The big e-fuel lie

William Todts — March 31, 2023

The e-fuel lobby’s main backers, the oil industry, are looking to derail mass electrification.

And so, after weeks of drama, the e-fuels saga has ended. Although the FDP and its engine acolytes were quick to declare victory, in reality the 100% zero-emission goal was adopted without changes. Engines were thrown a very weak lifeline, depending on a series of new legal acts. Even if a carve-out is created, e-fuels will be no match for EVs. 

But that’s only half the story. The e-fuel lobby’s backers, mainly the oil industry, are not looking for a fair contest between e-fuels and electric vehicles (EVs) – they are looking to derail mass electrification. They were roundly defeated until a few weeks ago. Thanks to Scholz and the FDP, they now emerge emboldened.

The origin of the e-fuels saga dates back to the post-Dieselgate era. Pre-2015 the oil industry hadn’t worried much about Europe’s CO2 standards. Then Dieselgate, the Paris Agreement and the rise of EVs changed everything. EVs are a mortal threat to big oil – once cars go electric, vans and trucks will follow, and half of oil demand evaporates. That’s why, since 2016, the oil lobby in Europe has ramped up its promotion of “clean fuels” as an alternative to EVs.

Since the Paris Agreement the consensus in Europe is that climate change is real and needs to be tackled. So, unlike in the US, the auto-oil complex can’t simply propose to stick with diesel and petrol. Their proposals need a veneer of climate credibility. By 2016, EU regulators were profoundly disillusioned with biofuels – remember, 50% of biodiesel was palm oil. This is how e-fuels, an old idea, newly promoted by Audi as a niche R&D and PR project, came to the fore.

Much has been said about the utter idiocy of turning scarce green electrons into hydrogen, then combining it with CO2 sucked out of the atmosphere to finally burn it in inefficient petrol car engines. T&E’s now famous graph shows efuels’ mind-bogglingly low efficiency. They only make sense for planes, which have no alternative to decarbonise. So, yes e-fuels are fantasy fuels for cars which is why the oil and engine industry aren’t actually investing in them. They aren’t idiots. 

Fast forward to 2019 when the EU launched the Green Deal. By then companies like Volkswagen, Mercedes and Audi, had committed to electrification, and brand-conscious oil companies (Shell, BP, Total) did not want to be seen attacking one of Europe’s central climate laws. So a new group was created, one that could take the gloves off: the eFuel Alliance. As any objective observer would conclude, an ‘alliance’ created by the oil industry, and backed by the likes of Exxon, Eni and the most retrograde auto suppliers, is little more than astroturf. The Guardian explains this well. 

E-fuel backers then proceeded to launch what appears to be a stunning campaign of corporate disinformation. According to transparency NGO, LobbyControl, the German oil industry federation (Uniti, also the founders of the eFuel Alliance) created a fake “grassroots campaign” (efuelsforfuture), with a Berlin PR agency organising pro e-fuels ‘demonstrations’ and putting banners on petrol stations. 

Despite all of this, EU lawmakers rejected Big Oil’s ploy and approved the CO2 standard for cars.

That’s when the e-fuel gang played their trump card: the FDP. Unabashedly pro fast cars and big engines,  the German ordoliberals were low in the polls and looking for a fight. With the kind permission of Chancellor Scholz, transport minister Wissing went on a veritable stampede, teaming up with the Italian far right to derail an agreement Germany had already consented to.

One could say that the damage is limited. There won’t be more than a handful of cars running on 100% synthetic fuels in 2035. And if the Porsche 911 can be bought as a 100% e-fuel car in 2035, who cares? But the oil industry has now breached the car CO2 standards which had always been about clean engines, not fuels which are regulated separately. They will seek to extend the “climate neutral” label to all fake green solutions including biofuels and push for an opaque creditting scheme so they don’t actually have to ensure cars are running on 100% e-fuels.

That is, if the current pro-climate consensus holds. Some of the corporations behind the e-fuels saga are denying climate change outside Europe. Given half a chance they will rip up the EU Green Deal and the EU car CO2 standards, just like they did with Obama’s climate legacy when Trump came to power.

Some say that electrification will win out anyway. And it will. The question is now one of speed and scale. The oil industry’s game is to slow things down in Europe and build up fossil demand elsewhere. Our goal is to ensure the rise of EVs is so rapid and complete, making EVs affordable for all, in and outside Europe, and thereby wipe out the oil barons’s existing and new markets.

This is not some kind of game we are playing. As the IPCC laid out very clearly, the future of our planet and our children requires us to move out of oil, coal and gas at breakneck speed. That is exactly what we will be working for in the next few years.

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