In the decarbonised energy system of the future, synthetic fuels from renewable electricity will be an important supplement to the (more energy-efficient) direct use of electricity from renewables. Lately, there has been increased interest in scenarios that rely on the wide-scale use of synthetic fuels at greatly reduced cost. What assumptions inform these projected cost reductions? To create more transparency in future discussions, Agora Verkehrswende and Agora Energiewende commissioned Frontier Economics to analyse cost reduction paths for synthetic fuels and investigate favourable locations in Germany and abroad for generating the renewable power needed to produce them. This study – together with the Excel tool available on our websites – presents the findings. A further aim of this study is to encourage discussion about how to make synthetic fuel production sustainable and which measures are mostly likely to achieve it.
