Marcelo Daller, plant manager for the HIF Global Haru Oni demonstration e-fuels plant in Chile. He says the wind in southern Chile is the key to creating the fuel.Mark Richardson/The Globe and Mail
It’s windy down here near the southern tip of Chile. It’s a powerful wind, strong enough to challenge the opening of the heavy doors on the Porsche Panamera I’m driving; strong enough, if I’m not careful, to slam the door on my leg.
Marcelo Daller, however, calls it a “high-quality wind.” For 6,000 hours every year, roughly 70 per cent of the time, day and night, the wind blows with enough strength to turn the blades of a giant turbine, which creates enough power to supply energy to the synthetic fuel plant I’ve come to see. The rest of the time, especially in summer, it’s often blowing even harder, above the 90-kilometre-an-hour threshold for the turbine. Other places have strong winds, but they’re not as consistent as the wind here.
Daller is the plant manager for the Haru Oni demonstration plant, which is operated by HIF Global LLC and has a US$74-million investment from Porsche AG. Right now, it’s capable of producing just 350 litres of synthetic gasoline a day, but when the full-size plant nearby is complete, with 60 wind turbines and a large-scale carbon-capture facility, the plan is to produce 66 million litres of e-fuel every year, and capture 230,000 tons of carbon dioxide from the air each year.
“It’s the consistency [of the wind] that is the difference,” says Daller. “If it’s too strong, we slow down the turbines or we stop them, but most of the time, it’s good wind for providing the power for what we need to do.”
Synthetic fuel made from carbon and hydrogen is not new, but the process for manufacturing it is constantly being refined to be more affordable and truly carbon-neutral. HIF (Highly Innovative Fuels) Global is a Chile-based e-fuels (electricity-based fuels) company that plans to build and operate this production facility in Patagonia this year. Construction is set to begin next year on larger facilities in Texas and Tasmania. When all three plants are operational in 2027, the plan is for them to produce 150,000 barrels of e-fuel each day and remove 25 million tons of carbon dioxide each year from the atmosphere.
HIF’s major shareholder is Chile’s AME (Andes Mining and Energy), and one of AME’s senior executives is an old college friend of Thomas Friemuth, the Porsche AG vice-president responsible for the Panamera sedan.
“When he told me of the potential for e-fuel, I knew it was a technology that Porsche should be involved with,” says Friemuth. “Electric cars are very good, but not everyone wants to drive an electric car, and we’ll still have [gas-powered] cars for many more years – new ones and older ones that stay on the road for another 20 years at least. And you know, e-fuel is the only fuel that is actually carbon-neutral. Electricity is not.”
Friemuth is referring to the likelihood that the electricity that powers modern electric vehicles is created by burning coal, oil or gas. Electricity created by renewable resources like water, wind or solar is essentially clean, like nuclear power, but e-fuels can go a stage further by being made from carbon that’s removed from the polluting carbon dioxide that’s in the air. E-fuels can power gasoline engines while actually cleaning more air than their already-cleaner emissions produce.
The demonstration facility here in Chile does not have a carbon-capture machine, but it will before the end of the year, says Daller. When it does, it will remove carbon from the air and mix it with hydrogen, separated through electrolysis from ocean water, to create methanol. Everything will be powered by the consistent energy provided by the wind. The methanol will be synthesized into e-fuel, which can then be processed into gasoline, jet fuel or marine fuel and shipped from the nearby deep-water port to Europe. The planned facility in Texas will supply North America, and the facility in Australia will supply Asia.
The major challenge for e-fuels is their cost. Large scale production is essential, but even then, the cost could still be greater than simple refinement of still-plentiful oil. “There’s no way that synthetic gasoline can get as cheap as crude oil,” says Marcos Marques, Porsche’s project manager for e-fuels, who did not provide the projected cost for HIF’s fuel.
A spokesperson for Canadian company Carbon Engineering told The New York Times in 2019 that production costs alone for e-fuel could be about US$4 for an American gallon, which is about $1.42 a litre, before shipping and taxes.
“We think that as the pricing is mainly dominated by taxes and regulations, (government) needs to come in and make it competitive,” says Marques. “We need government support. Either they make crude oil more expensive, or they support the synthetic fuel.”
Even then, the process is not straightforward. Carbon Engineering Ltd., which manufactures carbon capture technology in Squamish, B.C., is not involved with the HIF facility and declined an interview, but did provide a statement to The Globe and Mail.
Mark Richardson fills up a Porsche Panamera with electricity-based fuel created at the plant.Mark Richardson/The Globe and Mail
“[It’s] important to note, carbon reduction activities – including using low carbon intensity synthetic fuels – are still likely to have some residual emissions,” said Chief Executive Daniel Friedmann. “High-quality carbon removal solutions, like Direct Air Capture, can be used in parallel as a mechanism to address those residual emissions to achieve true net zero. Ultimately, a suite of viable carbon reduction and removal tools will play a critical role in the world’s decarbonization toolkit.”
The whole point is that e-fuel is a direct alternative to gasoline, processed to be the equivalent of premium fuel. No engine modifications are needed. This is why Porsche invited me (an automotive journalist and most definitely not a chemist) here to the bottom of South America.
Mark Richardson drives a Porsche Panamera around the scenic Torres del Paine National Park in Chile.Mark Richardson/The Globe and Mail
I filled up a Panamera e-hybrid with e-gasoline at the demonstration plant and went for a 500-kilometre drive around the scenic Torres del Paine National Park; the sedan performed exactly as I would expect it to with a tankful of Premium gas – no hiccups, no lack of power, and no additional consumption – and I was quickly distracted by the snowy mountaintops and strange wild animals into forgetting about its synthetic fuel.
The short-term market for e-gasoline is massive, as the world’s governments regulate gas-powered vehicles into submission and replace them with electric vehicles. Its long-term future is quite different though, when those gasoline-powered vehicles no longer exist. After 2050 or so, when the demand for automobile fuel declines, the market will be for clean aviation and marine fuel, for aircraft and ships that cannot run so practically on electricity alone.
“At least, we’ll still be able to drive our gasoline cars,” says Friemuth, who owns a classic Yenko Camaro at home in Germany. “Not everyone wants to drive an electric car.”
The writer was a guest of the automaker. Content was not subject to approval.
Editor’s note: An earlier version of this article stated that when the full-size Haru Oni plant is complete, it will produce 66 million litres of e-fuel every day. In fact, the goal is for the plant to produce 66 million litres per year. This version has been corrected.