Current and future cost of e-kerosene in the United States and Europe

The authors examine the potential role of e-kerosene in aviation decarbonization, from an economic perspective. E-kerosene, a sustainable aviation fuel (SAF) compatible with current combustion engines and fueling infrastructure, is produced by the combination of carbon dioxide (CO₂) with hydrogen derived from water electrolysis. If renewable electricity is used for electrolysis, e-kerosene could have almost zero greenhouse gas (GHG) emissions. The International Civil Aviation Organization (ICAO) sees SAFs as crucial to achieving GHG emissions reduction in aviation and in recent years some government bodies have provided support for SAFs, especially e-kerosene. The aviation industry also has included e-kerosene in its decarbonization planning and has begun e-kerosene production. The authors estimate the costs of e-kerosene production in the United States and the European Union (EU) from 2020 to 2050. Renewable electricity is presumed as the energy source for e-kerosene production and is assumed CO₂ to be provided from a point source. The authors estimate the average e-kerosene production cost in the US to be $8.80 per gallon (€2 per liter) in 2020, decreasing to $4 per gallon (€0.9 per liter) by 2050. The estimated e-kerosene production cost in the EU is $12.40 per gallon (€2.8 per liter) in 2020, decreasing by 2050 to $6.70 per gallon. The EU has higher costs because of more expensive renewable electricity. Although the authors assume low CO₂ costs and a combination of technologies that gives the lowest e-kerosene cost, e-kerosene is not expected to be cost-competitive with fossil kerosene before 2050. The estimates show that the 2020 production cost of e-kerosene is 7 times more (U.S.) or 10 times more (EU) than that of fossil kerosene. This price gap will substantially decrease to 1.5 times more (U.S.) or 2.5 times more (EU) by 2050. Financial incentives for large-scale adoption of e-kerosene are therefore needed to enable its role in aviation decarbonization in the near term. A carbon price of $400 per tonne CO₂e in the US or $630 per tonne CO₂e in the EU could make e-kerosene cost competitive by 2030, with a decrease to $110 per tonne CO₂e (United States) or $350 per tonne CO₂e (EU) by 2050. High incentives in the near term can help prepare the way for cheaper and more plentiful e-kerosene production in the long term.

• Record URL:
  https://theicct.org/wp-content/uploads/2022/02/fuels-us-europe-current-future-cost-ekerosene-us-europe-mar22.pdf
• 
• Summary URL:
  https://theicct.org/publication/fuels-us-eu-cost-ekerosene-mar22/
• Corporate Authors:

  International Council on Clean Transportation (ICCT)

  1500 K Street NW, Suite 650
  Washington, DC  United States  20005

  Aspen Institute

  Washington, D.C.    20037
• Authors:
  • Zhou, Yuanrong
  • Searle, Stephanie
  • Pavlenko, Nikita
• Publication Date: 2022-3

Language

• English

Media Info

• Media Type: Digital/other
• Features: Figures; References; Tables;
• Pagination: 15p
• Serial:
  • Working Paper
  • Issue Number: 2022-14
  • Publisher: International Council on Clean Transportation (ICCT)

Subject/Index Terms

• TRT Terms: Alternate fuels; Costs; Forecasting; Jet engine fuels; Kerosene; Production
• Geographic Terms: European Union; United States
• Subject Areas: Aviation; Energy; Finance; Planning and Forecasting;

Filing Info

• Accession Number: 01843620
• Record Type: Publication
• Files: TRIS
• Created Date: Apr 25 2022 10:07AM