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SWEN Capital Partners invests in e-fuels producer Arcadia 

Published: 12 January 2023

The investment will allow Arcadia eFuels to develop the world’s first commercial facility to produce low carbon e-fuels for the aviation sector. 

The production of sustainable fuels is key to the decarbonisation of the aviation sector | Photo by Arcadia eFuels

Paris-based SWEN Capital Partners has invested in Danish startup Arcadia eFuels (Arcadia) to develop its PtX-facility, reported to be the world’s first commercial facility to produce low carbon e-fuels for the aviation sector. 

The investment, which is being made through the Swen Infrastructure Fund Transition 2 (Swift 2), was described as providing the development capital required to reach final investment decision.  

Arcadia said this meant the company could start on the front end engineering designs for the e-fuels production sites with the aim of starting construction by late 2023/early 2024.  

Arcadia, which intends to own and operate these sites, with the first in Vordingborg in southeastern Denmark scheduled to begin operations in 2026, said they planned to have two more plants in operation by 2026/2027 and were working on sites in the US, UK as well as other EU countries.  

The company will use its sites to produce, market and sell low carbon e-fuels such as e-kerosene, e-diesel and e-naphtha to the aviation industry to help reduce the sector’s CO2 emissions. 

Swift 2, launched in 2021, aims to invest in companies and assets focused on renewable gas production, including investments in biogas/biomethane farms and developers, green H2 developers and biofuels/e-fuels developers.

“Although flying less must be a priority, we will keep on traveling long distances in the foreseeable future. It is therefore of utmost importance to produce sustainable aviation fuels with the lowest carbon footprint. Recombining green hydrogen from wind and solar, with much desired biogenic CO2 for example out of the biomethane industry where Swift2 is a European champion, provides a solution, which is being promoted by the EU under its ReFuelEU Aviation initiative,” said Olivier Aubert, managing director at SWEN Capital Partners.  

The challenge of decarbonising aviation 

The aviation sector accounts for around 2.5% of global CO2 emissions but air travel, as well as being among the most carbon intensive forms of transport, has been notoriously difficult to decarbonise using existing technologies.  

Speaking to Impact Investor, Amy Hebert, CEO of Arcadia eFuels, said the technology to produce green hydrogen and biogenic CO2 was now at a stage that “made sense to start commercial production of e-fuels using green H2 and bio CO2 as raw materials”. 

“As we are using biogenic CO2 as a raw material, the e-kerosene is a net-zero carbon fuel, so close to 100% CO2 reduction,” she added. 

SWEN Capital Partners and Arcadia say that increasing public and political pressure to curb carbon emissions, the airline industry’s own pledge to meet net zero carbon emission by 2050, and pending EU legislation mandating the use of sustainable aviation fuels, specifically eKerosene by 2030, was also throwing a spotlight on the need for greater investment in low carbon aviation fuel to reduce CO2 emissions and combat climate change. 

E-fuels are produced by using renewable electricity to make green hydrogen, then combining hydrogen with carbon dioxide from direct air capture and/or other biogenic carbon sources to produce syngas. The syngas is then processed and refined into e-fuels such as e-kerosene, e-diesel, and e-naphtha.  

“We believe e-fuels are the fuels of the future since they allow society to use existing infrastructure and engines but with net zero CO2 emission fuels instead of conventional fossil fuels.  To make a more significant impact, there needs to be large investment in e-fuels facilities and much more affordable renewable electricity,”  said Hebert.   

The output of each plant is approximately 100m litres per year or 75,000 metric tonnes of e-fuels, and Arcadia plans to build between two to three plants per year globally. Hebert said this volume represented approximately 10% of Copenhagen airports annual demand. 

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