Power-to-liquids: the economics?

The data-file models the economics of converting renewable electricity (wind or solar) into low-carbon liquid fuels, by electrolysing water into hydrogen, electrolysing CO2 into CO, then re-combining the products into longer chain hydrocarbons, e.g., using Fischer Tropsch or other methods.

Our base case estimates are for costs between $400-600/bbl ($10-14/gallon). The thermodynamics are somewhat crazy. Input assumptions are based on our other models and can be flexed to stress-test the economics.

It seems very challenging for this power-to-liquids technology to ever reach cost-parity with conventional hydrocarbons, or below $3/gallon. However, if money were no object, they could yield effectively zero carbon transport fuels for hard-to-abate sectors such as trucking or aviation.

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