BMW study examines renewable fuels and EU transport future

BMW, KIT and partners present a study on renewable fuels, outlining their role alongside electrification in reducing transport emissions across the EU. Read more.

Decarbonising transport cannot be achieved through electrification alone—this is the central conclusion of a new study presented by BMW Group together with the Karlsruhe Institute of Technology (KIT), the German Biomass Research Centre (DBFZ) and FREYBERGER engineering. The focus is on the potential of renewable liquid fuels that can be used within existing infrastructure.

The study examines so-called Carbon Neutral Fuels (CNF), a broad category of fuels with a lower carbon footprint than fossil fuels. These include liquid energy carriers that can replace conventional fuels without requiring modifications to engines or refuelling networks. Alongside hydrogen, such fuels are seen as a key pathway to reducing emissions in transport.

Particular attention is given to feedstocks and production methods. These fuels are derived from waste and residues, including used cooking oils, agricultural by-products, wood-based biomass, sewage sludge and algae. European policy already defines these sources under the category of advanced biofuels, aiming to limit pressure on food systems and land use.

Production technologies vary widely. They include thermochemical processes such as pyrolysis and Fischer–Tropsch synthesis, as well as power-based methods in which hydrogen is produced from water and then combined with CO2 to create synthetic fuels. Pilot projects, including industrial-scale e-fuel production in Chile, demonstrate that these approaches are already moving beyond theory, though volumes remain limited.

The European market context explains the renewed interest in such solutions. Renewable energy accounted for 11.2% of transport energy consumption in the EU in 2024, still far below the 29% target set for 2030. At the same time, advanced biofuels have seen rapid growth, with consumption increasing several times in recent years, even as production capacity remains relatively small.

Regulation is also shaping the sector. The updated Renewable Energy Directive (RED III) sets binding targets for reducing greenhouse gas intensity and increasing the share of renewable energy in transport, including specific quotas for advanced biofuels and synthetic fuels. Additional measures address traceability and sustainability, including limits on feedstocks linked to deforestation and land-use change.

Comparisons with other technologies remain complex. Electric vehicles are significantly more energy-efficient, while synthetic fuels require substantially more electricity to produce. However, renewable fuels are considered particularly relevant for sectors that are difficult to electrify directly, such as aviation, maritime transport and the existing fleet of combustion-engine vehicles.

Automakers are already responding. BMW advocates a technology-neutral approach, combining electric, hydrogen and fuel-based solutions. The company is testing alternatives such as HVO 100 and synthetic fuels, while others, including Porsche and Stellantis, are investing in e-fuel production and engine compatibility to reduce emissions from vehicles already on the road.

The study looks ahead to 2030, 2035 and 2040, analysing feedstock availability, conversion technologies and future fuel demand across the EU. Its conclusion is clear: reducing emissions will require multiple parallel pathways, with renewable fuels playing a complementary role alongside electrification.