E-fuels: a strategic opportunity that requires action. By Cleantech for Iberia, ECODES, T&E

It's clear that achieving decarbonization in the aviation and maritime sectors is no easy task. As extremely heavy modes of transport, direct electrification isn't viable in certain cases. Decarbonizing medium- and long-haul aviation and large-tonnage vessels on open and interoceanic routes is undoubtedly one of the greatest challenges of the energy transition we are immersed in as a society.

Mitigating greenhouse gases in these sectors requires nothing less than developing a new alternative to fossil fuels. Furthermore, this alternative must be energy-dense enough to power ships and aircraft, truly scalable to meet the demand of these sectors, and, of course, truly sustainable and carbon-neutral.

Advanced biofuels might intuitively seem like a good solution. However, we know that their availability is very limited, that they face fierce intersectoral competition for their use (chemical, petrochemical, food, etc.), and, even more seriously, their scarcity has led to massive fraud through the importation of energy and food crops brought in bulk from various corners of the globe.

The potential of e-fuels

Consequently, due to the limited role of truly sustainable biofuels in decarbonizing these sectors, synthetic fuels for aviation and marine, combined with demand reduction measures, are the only solutions in sight. These are fuels created from scratch with additional renewable electricity, through the electrolysis of water to obtain hydrogen (the so-called green hydrogen). This emission-free electrolytic hydrogen is then mixed with another molecule—usually CO₂—to synthesize a fuel with net-zero emissions over its life cycle.

In this context, driven by the energy crisis following Russia's invasion of Ukraine in 2022, the RePowerEU initiative marked the beginning of a new direction in terms of ecology and energy security, based on green hydrogen derivatives. The European Union got to work: it introduced synthetic fuels—known as RFNBOs in EU jargon—and set supply targets by revising the Renewable Energy Directive (RED III) and the RefuelEU Aviation and FuelEU Maritime regulations, establishing specific usage targets for each sector.

However, we are in 2025, and any minimally informed observer knows that we are still far from making synthetic fuels a reality on a commercial scale before 2030.

Funding and regulatory gaps

To successfully drive the deployment of these new green fuels, it is essential to have clear and stable regulations beyond 2030, sufficient electricity connection points to support production plants, and adequate refueling infrastructure at ports. These elements are essential to provide certainty to investors and accelerate the adoption of these truly sustainable solutions.

For now, funding is lacking. Private investors, faced with uncertain legislation, are still lacking confidence in the European plan. Public support from the EU, through the European Hydrogen Bank, does not cover the structural gap represented by the cost of operating a plant of this nature. It is important to remember that this is a new, immature technology, and it will require public support.

While this need has been recognized in the US—through the IRA—or in China, through public debt leverage, in Europe projects still lack sufficient financing to get off the ground.

Europe: between ambition and reality

Rather than prioritizing strategic and co-localized uses of green hydrogen—those with the greatest impact on industrial decarbonization—Europe has opted for a maximalist vision of the hydrogen economy, announcing targets of 20 million tons of hydrogen use by 2030, influenced in part by the logic of natural gas and its traditional role as an "energy carrier."

The focus shifted from the fundamentals: building strong industrial ecosystems around prioritized and viable demand. Today, the development of this entire ecosystem is in question, and with it, the effectiveness of the European approach.

Although the EU's progress is undeniable, it is time to accelerate the transition. The efforts made so far—such as RED III and the RePowerEU Plan—demonstrate that the path is possible, but it is key to strengthen industrial financing mechanisms and adapt the regulatory framework to scale solutions more quickly.

It is urgent to activate strategic levers

The window of opportunity remains open: prioritizing strategic projects, simplifying permits, and ensuring clear incentives can make a difference in this crucial decade.

For example, it seems essential to introduce contracts for difference (CfD) within the European Hydrogen Bank and/or integrate them into initiatives such as the German Global H₂ Bank. Establishing a certain and predictable price with the introduction of an intermediary would reduce risks for both producers and buyers, achieving the long-awaited offtaker and facilitating the medium-term contracts required by plants to guarantee their viability.

In parallel, the Spanish government—probably through the IDAE—should leverage PERTE instruments to strengthen OPEX support, breathing new life into these projects in their early years of operation, when costs are highest and demand has yet to consolidate.

Spain, at the crossroads of leadership

In 2025, the aviation and maritime sectors are undoubtedly the best candidates to boost the e-fuels ecosystem. Yet, projects, which require at least three or four years between construction and operation, still lack the necessary guarantees to reach a final investment decision.

Therefore, it is urgent to open a space for joint reflection between public institutions, industrial stakeholders, and civil society organizations to overcome the barriers that prevent Spain from becoming a European leader in the sector. The signatories of this column are prepared to push for the creation of sectoral pathways, and we have already begun. We trust that public authorities are also ready to intensify their actions.

Signatories:

Cleantech for Iberia (a platform that promotes innovation in clean technologies to position the Iberian Peninsula as a leader in Europe's ecological transition)

ECODES (an independent foundation based in Spain promoting sustainable development through partnerships between public, private, and social sectors)

TEA (European organization that advocates for effective policies to decarbonize transport and reduce its environmental impact)

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