Danish P2X project could overtake all competitors: Expected annual production of 68 million litres of e-jet fuel from 2025

Last year, DCC & Shell Aviation delivered green aviation fuel to Air Alsie in Sønderborg. At the time, it was the controversial HEFA fuel. From 2025, it may be pure e-fuel instead. Illustration: DCC & Shell Aviation

68.4 million litres of green jet fuel per year from 2025, produced using electricity and captured CO2—some of it from the world’s largest direct air capture plant.

This is the ambition of the P2X project Arcadia eFuels, which will soon be able to announce the location of its future Danish plant, which will contain the entire production chain for the finished e-kerosene.

The fuel will be produced by making syngas through reverse gas-water shift reaction with hydrogen produced from electrolysis and captured CO2, converting the gas to hydrocarbons via the Fischer-Tropsch process, and refining them.

The electricity used for electrolysis will be procured in the regular electricity market by means of power purchase agreements (PPA), which ensure an equivalent renewable energy capacity.

The resulting e-kerosene is a so-called SAF—sustainable aviation fuel—and can be used to directly replace fossil jet fuels in the aircraft tanks.

“We have a very ambitious schedule to get our plant up and running towards the end of 2024 and produce around 55,000 tonnes of FT-SPK jet fuel per year. I’m pretty sure it’s going to be the biggest plant of its kind in the world,” says Arcadia eFuels CEO Amy Hebert, who used to work at Haldor Topsoe.

Substitute for five percent of Denmark’s jet fuel

If the plant is completed on time, the Prime Minister’s dream of a 100 percent green domestic route by 2025 and completely green domestic flights by 2030 is theoretically possible, although it probably cannot be done so quickly in practice.

The reason is that existing aircraft engines and fuel systems are made for fossil fuels, and they are only approved for fuel blends that contain a maximum of 50 percent of SAF.

Various tests are underway to change this, but aviation safety is notoriously slow. One of the questions is whether the integrity of seals in older aircraft can be preserved if fuel does not contain aromatics.

Therefore, a tabletop exercise in which domestic air services pay for fuel corresponding to their consumption to be added to all aviation fuel refuelled at home is a more likely solution.

And with an annual consumption on Danish domestic routes of a total of 22 million litres of jet fuel in 2019, before the corona crisis, Arcadia eFuels’s expected output of 68 million litres will more than satisfy the demand.

In 2019, when air travel was last “normal”, Denmark used approximately 1.3 billion litres of jet fuel. Thus, Arcadia eFuels’s production can substitute about five percent of all jet fuel refuelled in Denmark with a green alternative.

Biogas upgrading for CO2

Arcadia eFuels has devised a project that will contain virtually all of Power-to-X’s complicated elements in a large system—which, of course, must be able to be replicated again and again.

The company is currently in the process of securing power purchase agreements for the 350 MW it will use for its production, based solely on renewable energy.

Then there is the location—it is still a secret, but soon a town council somewhere in Denmark will vote on the plant on the local level.

One thing is for sure though—it has to be near a biogas plant.

Although it is also possible to capture CO2 from other sources, a share of the approximately 270,000 tonnes of CO2 that must be combined with hydrogen to make the syngas every year will, according to the plan, be captured from biogas upgrading.

This is biogenic CO2, which is already part of the carbon cycle. Today, it is just released into the atmosphere, except for the relatively small amounts that are captured for cooling, for example.

If it is used in an aircraft engine along the way, it has no extra effect on the climate—and can even serve to displace a similar fossil emission.

“We have signed a letter of intent for that part, and it will be among the things we will publish soon,” said the CEO of Arcadia eFuels.

The world’s DAC capacity will increase several fold

10–30 percent of the project’s CO2 consumption deserves specific mention. The company will capture it from the air, using so-called direct air capture (DAC). The hope is to get funds for the plants via the CCUS subsidy pool worth DKK 16 billion.

If we succeed in getting that part of the project on track, we will have the world’s largest capability for CO2 capture from the atmosphere.

The currently largest DAC project was launched in Iceland in September and will capture 4,000 tonnes of CO2 per year. All of the world’s current DAC projects, including the Icelandic one, capture 12,000 tonnes of CO2 each year.

Arcadia eFuels’s plant will thus more than double the world’s total DAC capacity, even at its lowest projections.

“It’s going to be wildly expensive, so we can’t use it to capture the whole amount we’ll need. That would make the project unfundable. But we want to demonstrate direct air capture, so we will capture a certain portion of it. We can’t just wait for the technology to be perfect—then we will never solve the world’s problems,” Amy Hebert says.

She is very much aware of the fact that this is the weakest part of the plan due to the hefty electricity price of capture and the current stage of the technology.

“But if it succeeds, our DAC will be six to seven times larger than the Icelandic one. And at the same time, our electrolysis process is also becoming one of the largest in the world. It’s a very interesting project. Because it’s about as big as we can manage on electrolysis and electricity,” Amy Hebert says.

Four to five times as expensive as jet fuel

Arcadia eFuels has not yet settled on the electrolysis technology—it could be PEM or alkaline, depending on the price and availability of the RE electricity. However, it will not be Haldor Topsoe’s SOEC electrolysis. It is not ready for this first plant.

“But we don’t just want to build a single plant. We want to build two or three a year once we get the first one running. We really hope to be able to use it when we reach plant two, three, or four. Because it provides higher efficiency, which can reduce the costs—it’s just not quite ready for the first one,” she says.

The plant in an unknown location in Denmark will also contain Fischer-Tropsch reactors in an area the size of several football fields. The refining of jet fuel must also take place on site.

As yet, the calculations of the energy conversion to the finished fuel have not been reviewed by third parties, and the same applies to its CO2 footprint.

But the CEO’s expectation is that the finished e-kerosene will cost four to five times the price of fossil jet fuel if the company does not receive state aid or other funding.

“I’m not particularly worried about that in the short term, and neither are our customers. Right now there is great demand and very little supply. But it’s clear that it’s not sustainable in the long term,” Amy Hebert says.

“This plant is the first of its kind, so it will naturally be expensive. But we will continue to work on the technology, the integration of the various elements, get a more mature electrolysis technology, reduce the renewable energy price, and so on, so that it can become cheaper,” she says.

Payback period three to five years

As with most start-ups, it’s hard to get an insight into the finances and the project’s real chances of turning into something. But it seems very realistic.

Several knowledgeable sources that Ingeniøren has talked to point out that the technology is available and mature enough, and that the production rate should probably be achievable.

They point out that the expected payback period for this type of plant, which will cost more than a billion DKK to build, is as short as three to five years.

“I think there are many now who say they can deliver such a factory. And there are also many who want to own it and invest in it. And with the government’s proposal that we do this, we also have the last part—that is, a guaranteed customer. So I think the next thing that needs to happen is that someone should be given the opportunity to build that factory. And everyone is waiting for someone to take the first step,” says Henrik Wenzel, professor of environmental and energy systems at the University of Southern Denmark.

The demand is incredibly high. The only “green” aviation fuel available right now is the so-called HEFA, which is produced from vegetable oil.

It has the potential to become the next greenwashing scandal because HEFA has the same sustainability issues as first-generation biofuels—seizing farmland for fuel production.

Fuel supplier wants to purchase every single drop

A call to DCC & Shell Aviation, Denmark’s largest supplier of aviation fuel that provides fuel to, among others, Copenhagen Airport, also indicates that Arcadia eFuels will be able to easily sell their e-kerosene if they get the production going.

They are well aware of Arcadia eFuels’s expectation that the price could be four to five times as high as regular jet fuel. Nevertheless, they signed a letter of intent to take every single drop.

“We have signed a cooperation agreement that when they one day produce a liquid fuel, we are very interested in purchasing it and distributing it to Danish airports. Their price is very much the same as we see on the market. Depending on the raw materials and the production method, it’s four to five times the price of commercial jet fuel,” says Sune Petersen, head of sustainability and strategy.

According to Amy Hebert, Arcadia eFuels expects to finance around 60 percent of the construction costs via loans—talks are underway with Danmarks Eksportkredit and the European Investment Bank.

At the same time, the company is leaning towards different public support schemes—the fuel producer has three specific funds in mind. The final investment decision will be taken towards the end of 2022.

The consortium Green Fuels for Denmark, led by Ørsted, will also produce green jet fuel, but it will not be ready until at least 2027. Norwegian company Nordic Electrofuel expects to begin constructing a smaller plant that can produce 10 million litres of e-kerosene this year, with production starting in 2024.