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Future fuels: What will the sector look like in 2050?

Every Friday over the course of 5 weeks, Eurofuel will present the "Future Fuels" in the framework of the EU Sustainable Energy Days.

By 2050, we need to decarbonise heating.

Liquid fuels can contribute to the energy transition for heating and ensure and inclusive recovery. They are a sustainable and affordable alternative for households located in off-grid areas (17% Europeans). The campaign will present the following topics:

1. Liquid fuels for heating: why we need them even more for the energy transition (10 September 2021)

2. What are they (FAME, HVO, PtX)? (17 September 2021)

3. How sustainable are they? (24 September 2021)

4. The liquid heating fuel industry and boilers manufacturers have tested the solution - how does it work? (1 October 2021)

5. What will the sector look like in 2050? (8 October 2021)

 

 

 

Future fuels: What will the sector look like in 2050?

#FutureFuelsFriday – part 5

Liquid fuels offer a cheaper, less disruptive and more consumer-friendly transition for many households in Europe. To meet the EU targets (European Climate Law, 2020/0036(COD): 55% reduction (compared to 1990 levels) of CO2 emissions in 2030, and zero emissions in 2050), the sector ambitions to be climate-neutral by 2050. How will we get there?

 

The liquid heating fuel sector will contribute to meet the EU climate targets

There is no fossil boiler: a boiler runs with what you put in it, provided it meets quality requirements. Today there are a wide range of fuel and blending options that can be incorporated progressively.

Boiler manufacturers and the liquid fuel industry are working together to ensure the compatibility between these alternative fuels and the heating systems, so that the quality requirements are met. This will allow each boiler to decrease its emissions by 55% in 2030 (compared to 1990 emissions), and by 100% in 2050, thus in line with the EU targets.

Based on the boundary conditions (availability and affordability), we can achieve 100% renewable or low carbon liquid fuels by 2050: starting from 33% as from 2026, reaching 100% in 2050.

What does this mean for the liquid heating fuel sector?

To assess the future of liquid fuels for heating, we have considered two different scenarios, which are illustrated in the graphs below:

Disclaimer: Out example models reflect what we expect at European level: some member states will go faster (for example Finland, where there is already an uptake of HVO for heating), others will go slower depending on the national boundary conditions such as the authorisation to put the product on the market.

There will be a decrease in the number of liquid fuel boilers on the market, with the deployment of other systems (district heating, heat pumps…). However, for many consumers, these alternatives will not work, and they will still rely on a liquid fuel boiler. We anticipate a total number of 8 million boilers in 2050 with the right boundary conditions (enabling scenario).

Looking at the total sales of liquid fuel, the energy transition requires a progressive phasing out of domestic heating oil. This has to take place while we increase the share of renewable component into the mix. We anticipate the decrease of total liquid heating fuels to be from 42 million tonnes in 2020, to 8 million in 2050 with the right boundary conditions (enabling scenario).

 

It appears that the most enabling policy framework (the “enabling” scenario) would lead to the “8 – 8 – 0” solution:

• The number of boilers for liquid fuel in the market will be at a level of around 8 million systems in 2050
• The domestic heating oil market will be at app. 8 million tons of liquid fuel per year in 2050
• All oil heating systems will be supplied with 100 % renewable or low carbon liquid fuel, with “0” CO2-emission in 2050

Such an enabling policy framework would allow 8 million households to use liquid fuel for heating and provide a concrete contribution to achieve climate neutrality by 2050! This is half of today’s market: households for which there is no viable alternative to liquid fuels, the “hard-to-abate” ones.