Potentials of electrofuels for decarbonizing long-haul flights: A holistic framework for evaluating the impacts of carbon capture strategies in electrofuel production

Electrofuels (e-fuels) are a promising low-carbon alternative to replace kerosene in aviation. However, widespread adoption of e-fuels would depend on financial mechanisms and decisions made by various actors, including the aviation sector, carbon markets, and energy markets, who try to set prices and shape policies in their favor. To achieve production flexibility and resilience to external shocks like supply delays, integrating e-fuel markets with carbon and hydrogen markets is inevitable. Investigating these market interactions is a key challenge in designing effective policies and strategies for facilitating e-fuel development. For airlines, e-fuel adoption depends on fuel and carbon cost savings, while for energy markets, it depends on the profitability of supplying e-fuels. This article aims to develop a framework for modeling and simulating the effects of financial mechanisms and carbon capture on commercial e-fuel production, bridging the price gaps with kerosene caused by reducing energy prices and scaling up electrolysis and carbon capture technologies. The framework comprises a system description with all stakeholders and their interactions, enabling the simulation of e-fuel production with different carbon capture scenarios. This will help derive policies to promote e-fuels in aviation, considering factors like carbon credits, learning rates, and economies of scale for low-maturity technologies.