Global economic and environmental trade-offs of power-to-liquid fuels

Power-to-liquid (PtL) fuels are carbon-based liquid fuels made from hydrogen and carbon dioxide that can substitute fossil fuels in hard-to-electrify mobility sectors, particularly aviation and maritime transport, but their climate benefits depend strongly on how hydrogen, carbon dioxide, and electricity are supplied. Here, we assess global economic and environmental trade-offs for three PtL pathways: power-to-methanol, methanol-to-jet synthetic kerosene, and Fischer-Tropsch synthetic kerosene. We develop a high-resolution, spatially explicit framework that combines energy system optimization, techno-economic and prospective life cycle assessment. Low production costs and low greenhouse gas (GHG) emissions are often geographically misaligned today: renewable-rich regions such as North Africa, southern South America, and the Iberian Islands offer low-cost opportunities, whereas low-GHG grid-connected production is concentrated in regions with low-carbon power systems, such as Canada and northern Europe. Grid-connected production can be cost-effective but loses its climate advantage in carbon-intensive power systems, whereas off-grid renewable production delivers the lowest emissions at a cost premium. Configurations that combine grid electricity with dedicated renewables weaken this trade-off but remain sensitive to residual grid carbon intensity. For synthetic kerosene, Fischer-Tropsch routes are generally less GHG-intensive than methanol-to-jet routes under comparable electricity supply. Carbon pricing, sustainable aviation fuel (SAF) mandates, and fossil-fuel price volatility can narrow the cost gap, but mainly for configurations with low well-to-wake emissions. PtL deployment should therefore be guided by electricity supply, regional siting, and full life cycle impacts rather than fuel labels alone.