Tasmania chosen as eFuel production base

PORSCHE is covering its options relating to the choice between electricity and internal combustion through a 12.5 per cent investment in Chile-based company, Highly Innovative Fuels Global (HIF) which proposes to build a new ‘eFuel’ production plant in Tasmania.

The German performance brand has invested $A100 million for its stake in HIF, which has a submission before the Tasmanian government to build the plant near Burnie commencing 2024.

HIF Asia Pacific, a wholly owned subsidiary of HIF Global, has filed a Notice of Intent with the Tasmanian Environment Protection Authority (EPA) seeking approval for the facility.

The company is hoping for a positive answer from the EPA as Tasmania is the preferred location for building the new production plant, which is predicted to cost nearly $1 billion to become a full-blown facility – potentially with Tasmanian government investment.

HIF Australia chief executive officer Ignacio Hernandez said the company sought areas that had abundant supplies of renewable energy (notably wind) as well as existing infrastructure for the construction of its production plants. 

It has already commenced construction of the Haru Oni pilot plant in Punta Arenas and, in addition to Australia, plans to next set up facilities in the United States where construction is expected to start next year.

Production of eFuels from hydrogen and CO2 using wind energy is expected to start at the Chilean Patagonian facility later this year.

The pilot plant is expected to produce around 130,000 litres of eFuels in 2022, after which its capacity will be expanded in two stages to around 55 million litres by 2024, and around 550 million litres by 2026.

Porsche is targeting a wholesale price of $US2.00 per litre once production has ramped up, but how much it will cost the consumer will vary based on how governments decide to tax it.

Synthetic eFuel (methanol-based and including LPG), enables the nearly CO2-neutral operation of combustion engines because the CO2 used to create the fuel is drawn from the atmosphere.

Compared to conventional fossil fuels, which have between 30 and 40 components, synthetic fuels have as few as eight. There are fewer contaminants in eFuel, so it’s better for engines and the environment. Porsche says it reduces emissions by around 85 per cent compared to today’s unleaded.

HIF says the plant will “use renewable energy and electrolysis to produce green hydrogen”.

“CO2 will be captured from a biogenic source and via a process of synthesis will combine the CO2 and hydrogen to produce eFuels.” 

“The eFuel will create a way for existing infrastructure and engines to become carbon neutral by continuously reusing and recycling the CO2.”

Porsche wants to ensure its ICE models, such as the 911 sportscar, could still be driven and enjoyed in future, while emitting up to 85 per cent fewer emissions, by virtue of running on sustainably produced “unleaded”. 

Michael Steiner, a Porsche board member said that although electrification was the German brand’s overarching strategy, eFuel could play an important role to help the automotive sector transition from fossil-based to sustainably-made fuels – there are still 1.3billion ICE-powered vehicles on the globe.

HIF Global is a holding company of internationally active project developers of eFuel (electricity based fuel) production facilities.

Members of the conglomerate include, among others: car manufacturer Porsche, multinational oil and gas giant Exxon Mobil and German industrial heavyweight Siemens Energy.

Barbara Frenkel, who is a member of the executive board for procurement at Porsche AG said, "Porsche is moving into an attractive business area with its stake in HIF Global, which has been an excellent partner. Synthetic fuels offer attractive prospects across many sectors, from the automotive industry to the aviation and shipping sectors.” 

“We see ourselves as pioneers in eFuels and want to drive the technology. This is one building block in our clear, overall sustainability strategy,” Mr Steiner said. 

As the automotive world rapidly transitions towards e-mobilty, eFuels remain of particular interest to industries for which electrification is not viable such as aviation and shipping and to a lesser extent, heavy road transport.

In a similar fashion to ethanol, eFuel can also power modern ICE (Internal Combustion Engine) vehicles either on its own, or when blended with fossil fuel-based petrol.  

Through its investment in HIF Global, Porsche is participating in an international financing round alongside the Chilean company Andes Mining & Energy (AME) and the American companies EIG, Baker Hughes Company and Gemstone Investments.

In total, an amount in the low nine-figure USD range is flowing into HIF Global LLC.