A couple of weeks ago Audi made an announcement claiming to have invented a process that manufactured diesel solely from water, carbon dioxide and renewable energy sources. This new sustainable diesel was christened e diesel. Former Oil Drum colleague Robert Rapier (RR) has already run some energy and cost numbers on the process to reveal it in its true colours. Robert I feel was rather conservative in his analysis. In this post I use Robert’s back of envelope calculations as a starting point to expose some of the harsh thermodynamic, economic and social realities.
- Using European electricity prices, the energy cost of e diesel at the refinery gate would be of the order €1.8 litre – excluding manpower, capex, profit, distribution costs and taxes. Adding in the latter might easily take the price to €3 / litre, much higher than Audi’s estimate of €1 to 1.5 € per liter. This compares with a refinery gate price for FF diesel of the order €0.65 per liter. e diesel may cost 2.7 to 4.5 times as much as traditional diesel.
- The energy return on energy invested (ERoEI) for the process is at best 0.5. For every BTU of e diesel produced about 2 BTUs of electricity are consumed. E diesel is an energy sink or energy conversion where at least 50% of the energy is lost along the way.
- To convert Europe to run on e diesel would require a 12 fold increase in todays “new renewable” infrastructure and would result in a doubling of the energy consumed in the transport sector.
While claims are made that Audi have invented a process it appears they have simply repackaged existing and well known chemical engineering techniques.
The end point involves reacting carbon monoxide (CO) with hydrogen (H2). To get to this point carbon dioxide (CO2) is concentrated from air and hydrogen (H2) is produced by passing electricity through water (electrolysis). RR speculates that the CO is produced via the water-gas shift reaction:
CO2 + H2→CO + H2O
Hence there are three main stages to this process that each carry an energy and financial penalty as detailed below.
Figure 1 The audi process uses well established chemical engineering processes.
RR provides a good description of the Fischer – Tropsch reaction that is employed:
25H2 +12CO→C12H26 +12H2O
This shows how the process produces as much water as it does e diesel. It is not rocket science to understand if you begin with water, destroy it by electrolysis, then simply recreate it, a considerable amount of energy is going to be wasted en route.
Energy Costs and ERoEI
RR describes the energy and finance costs required to produce 1 tonne of e diesel and his figures form the foundation of this analysis. Those needing further information on how these figures were derived should consult the RR article. There are three main components to consider.
1) The energy required to separate CO2 from air. 3.2 tonnes of CO2 are required to make a tonne of e diesel and an energy cost of 250kWh per tonne is identified giving a total of 800 kWh.
2) The energy required to make H2 from water. 294 kgs of hydrogen are required to make 1 tonne of fuel. At this point RR does not give the energy used but simply quotes the cost $4 / kg. Converting that to electricity at 6.9c per kWh (US price) works out as 4 / .069 *294 = 17,044 kWh to make 294 kgs of H2.
3) The thermal energy used in the conversion process is 1750kWh per tonne of CO2 (3.2 tonnes) = 5600 kWh.
CO2 separation = 800 kWh
Hydrogen production = 17,044 kWh
Thermal energy for conversion = 5,600 kWh
Total = 23,444 kWh per tonne
And so how much energy does a tonne of diesel contain? It turns out that a tonne of diesel is not so very different to a tonne of crude oil in terms of energy content and a tonne of crude contains 12 MWh of energy equivalent . What we see here is that 1 tonne of e diesel that used 23.4 MWh to produce contains about 12 MWh of energy. The energy return on energy invested is 0.5 (excluding manpower, capital and transportation energy costs).
Figure 2 Energy Return on Energy Invested (ERoEI) = energy procured divided by the energy used to procure energy. Legacy fossil fuels have had ERoEI over 50 but this has declined over the years as the grade of reserves being tapped has declined meaning that more men, machines and energy are required to extract fuel today. The value of 9 for fossil diesel comes from ref 2. This combines crude oil extraction and refining energy costs.
This process is not an energy source but an energy conversion. Renewable electricity is converted into liquid fuel. An analogy would be a coal fired power station where coal is converted into electricity. 50% efficiency is typical for conversions and is quite good. The trouble for Audi is this. Coal is dirt cheap and not much good for anything else and the power station upgrades its energy to the Rolls Royce of energy flow, i.e. despatchable electricity. Audi’s process takes the Rolls Royce of energy – electricity, and one of the most expensive versions of that electricity ever invented – wind power, and converts it to diesel. E diesel has high value because it is a stable, storable, energy dense liquid fuel but it is not made from coal dust, it is made from gold dust. This of course works through in the economics.
The cost calculation below simply converts the energy used into Euros and cents using an industrial electricity price of €0.09 per kWh for Germany .
CO2 separation = 800 kWh * €0.09 = €72/ tonne
Hydrogen production = 17,044 kWh * €0.09 = €1534/ tonne
Thermal energy for conversion = 5,600 kWh * €0.09 = €504/ tonne
Total = 23,444 kWh per tonne * €0.09 = €2110 / tonne
1 tonne = 308 US gallons = 1,165 litres 
23,444*0.09c = €2110 / ton = €6.85 / gallon or €1.81 / liter (Germany)
This is a bit higher than the €1 to €1.5 per liter claimed by Audi. At face value, with diesel retailing at €1.24 / liter in Germany  this price of €1.81 / liter does not seem to be a game killer. But here’s the rub. For a start I use the mean price of electricity, made cheap in Germany by burning coal. Arguably a significantly higher electricity price should be used since the input price should be for wind or solar power that are well above the average. Furthermore, this calculation is for the energy cost alone and excludes manpower, capex, profit and distribution costs. Adding in all those other costs, it is not difficult to imagine the real cost of e diesel coming in at over €3 per liter. And then there is tax.
The price paid for diesel at the pump in Europe is enormously distorted by taxes. The refinery gate price for diesel in Europe is of the order €0.66 . Hence e diesel is at least 2.7 times as expensive, perhaps 4.5 times more costly than conventional diesel. And that is a game killer, especially since it’s unlikely that governments will be able to levy taxes on the CO2 neutral fuel.
Impact on Society
The EU currently gets about 6% of its primary energy from other new renewable sources. This compares with 35% from oil that is used mainly in transport. To replace crude oil with new renewable e diesel would require a 12 fold uplift in wind turbines and solar panels, just to provide the transport sector with fuel. It is a 12 fold and not 6 fold uplift since the Audi process is only 50% efficient – twice as much energy is required.
Figure 3 Primary energy consumption in the EU in 2013 .
In summary 1) converting the whole of Europe’s vehicle fleet to run on e diesel would double the energy used by the transport sector 2) the cost of e diesel is likely in the range 2.7 to 4.5 times more expensive than conventional diesel, 3) it would require a 12 fold increase in the current wind and solar deployment to provide the necessary “carbon free” electricity and 4) it’s unlikely that governments will be able to levy taxes on the new fuel and would therefore lose significant revenues that flow into their coffers from the fossil fuel industries. At the end of the day it makes more sense to put renewable electricity into a Tesla battery.
 BP Statistical Review of World Energy 2014
 A Set of Coherent Indicators for the Assessment of the Energy Profitability of Energy Systems
 statista – the Statistics Portal
 Fuel Prices in Europe