Understanding the role of green fuels
Green fuels are essential to decarbonising sectors where direct electrification is not enough. But what are they, how are they produced, and how will they be used in the future energy system?
Green fuels
No "one-size-fits-all" fuel will solve the green transition
Experts across the MissionGreenFuels partnership agree that there is no single “winning” fuel for the future. Instead, a combination of different green fuels will be needed - depending on sector, application, and infrastructure.
Shipping, aviation, and industry each have different requirements. This means the future energy system will rely on multiple fuel types working together to decarbonise where direct electrification is not sufficient.
Back-to-basics
What are green fuels?
Green fuels, also referred to as sustainable or renewable fuels, are produced using renewable energy sources such as wind and solar, or from sustainable bio-resources.
They can replace fossil fuels in sectors where electrification is not feasible, and depending on how they are produced, they can be low-carbon, carbon-neutral, or even carbon-free.
Green fuels are typically divided into two main categories:
e-fuels / Power-to-X
E-fuels are often produced by combining green hydrogen with carbon or nitrogen to create liquid or gaseous fuels such as methanol, ammonia, or synthetic jet fuel.
They are particularly relevant for sectors like shipping and aviation, where energy density and compatibility with existing infrastructure are critical.
Biofuels / Bio-to-X
Biofuels are produced from biomass such as waste, residues, or other biological materials. They can often be used as “drop-in” fuels in existing infrastructure.They are especially important in the short term and in applications where immediate emission reductions are needed.
Biofuels are produced from biomass such as waste, residues, or other biological materials. They can often be used as “drop-in” fuels in existing infrastructure.They are especially important in the short term and in applications where immediate emission reductions are needed.
Note: This is a non-exhaustive list and a simplification of often complex multi-step production processes.There are other lower TRL technologies and pathways not shown in the above diagram. Source: Adaption of Green Power Denmark’s “Recommendations for a Danish Power-to-X Strategy”4, Ramboll analysis
Types of green fuels
Different green fuels serve different purposes. Each fuel has its own characteristics, advantages, and limitations - and will play a role in different parts of the energy system. Below is listed of the primary fuel types in the MissionGreenFuels partnership and their characteristics.
HYDROGEN
Green hydrogen is the cornerstone of all e-fuels. It is produced through electrolysis using renewable electricity and can be used directly in combustion engines or in high-efficiency fuel cells.
Hydrogen has a high energy efficiency (well-to-wake), but its low volumetric energy density makes it less suitable as a primary fuel for shipping and aviation.
AMMONIA
Green ammonia is produced by combining nitrogen with hydrogen through the Haber–Bosch process. Today, ammonia production accounts for around 2% of global energy consumption and is mainly used in fertilisers.
Ammonia is considered one of the most promising green fuels for shipping, but its toxicity and corrosiveness pose significant safety and handling challenges.
METHANOL
Green methanol is produced either by combining captured CO₂ with green hydrogen or by converting biomass into methanol.
Methanol has a higher volumetric energy density than ammonia and is easier to handle. However, as a carbon-based fuel, it emits CO₂ when used. E-methanol is typically more expensive, while bio-based methanol can be more cost-competitive.
SAF
The energy density of fuels such as ammonia and methanol is too low for aviation. Instead, sustainable aviation fuel (SAF) is used as a drop-in replacement for conventional jet fuel, compatible with existing aircraft and infrastructure.
SAF is currently more expensive to produce than other green fuels but is widely expected to become the dominant solution for decarbonising aviation.
Green fuels roadmap
From fossil to green
Green fuels are part of a broader energy system where renewable electricity, hydrogen, CO₂, and bio-resources are interconnected. In this system, CO₂ is not only managed as an emission, but can also be captured and reused (CCU) as a resource in fuel production.
Production, infrastructure, and end-use must develop in parallel — from electrolysis and fuel synthesis to transport, storage, and use in industry, shipping, and aviation. This system perspective is essential to scaling green fuels and integrating them into the future energy system.
Green fuels also strengthen energy security by enabling local production based on renewable energy sources.
The transition to green fuels will happen over time. In the short term, biofuels and drop-in fuels can reduce emissions within existing systems. In the longer term, large-scale deployment of e-fuels such as sustainable aviation fuels, ammonia, and methanol will be needed to fully decarbonise hard-to-abate sectors.
Scaling production, reducing costs, and developing infrastructure are key challenges that must be addressed to enable this transition and turn potential into real-world impact.
This transition will require coordinated action across technologies, infrastructure, and policy.
Explore the green fuels roadmapFunded projects supporting the deployment of green fuels
MissionGreenFuels support projects throughout the green fuels value chain from fuel production to utilisation at the end-user.