Near-Term Potential of Biofuels, Electrofuels, and Battery Electric Vehicles in Decarbonizing Road Transport

We develop a framework for comparing carbon-neutral synthetic fuels (CNSFs)

with battery electric vehicles (BEVs) as alternatives to reducing CO2 emissions

from light-duty vehicles. CNSFs can be divided into fuels produced from

biomass via gasification and electrofuels produced from CO2 and water using

electricity. We develop CNSF cost estimates for first-of-a-kind plants operating

at commercial scale. Although already competitive over short distances, we find

that longer-range BEVs are likely to remain more expensive than CNSFs even if

low (
$125/kWh) battery costs are achieved, and all three options would

require carbon prices in excess of $130/tCO2 or oil prices in excess of

$100/bbl to become commercially viable relative to petroleum. The viability

of electrofuels ultimately depends on access to low-cost, ultra-low-carbon power

systems or sources of zero-carbon electricity with high annual availability.

Priorities should include deploying a portfolio of CNSF technologies to help

 

appraise decarbonization pathways, economies of scale, and learning by doing.