Abstract

The report examines the role of sustainable fuels in achieving net zero emissions, particularly in hard-to-abate sectors such as transport and industry. It finds that demand for low-emission fuels must double by 2030 and again by 2050 under the IEA Net Zero Emissions by 2050 scenario, yet no major fuel pathway is currently on track. The absence of internationally consistent sustainability definitions and metrics is identified as a key barrier to investment and scale-up.

Chapter 1. Introduction

Sustainable fuels complement electrification and energy efficiency by enabling decarbonisation where direct electrification is not feasible. These fuels also support energy diversification and security. The report highlights wide variation across fuel pathways, including biofuels, hydrogen and hydrogen-based fuels, in terms of costs, maturity and emissions performance. Biofuels are currently the most developed option but face feedstock and sustainability constraints. Low-emission hydrogen supply remains limited, while hydrogen-based fuels face cost and CO₂ feedstock constraints. The chapter establishes the need for common criteria to enable fair comparison across fuels and regions.

Chapter 2. Carbon accounting: Standards, regulations and certification systems

This chapter maps existing carbon accounting frameworks and certification schemes for sustainable fuels. It finds common use of lifecycle assessment methods, but significant divergence in system boundaries, treatment of land-use change and inclusion of transport emissions. For biofuels, greenhouse gas (GHG) intensities vary widely depending on feedstocks, regional factors and methodological choices, with land-use change being the largest source of disagreement. For hydrogen, 34 certification schemes exist, with over half requiring emissions below 33 gCO₂-eq/MJ, yet most exclude transport and distribution emissions. The report identifies data gaps, inconsistent scopes and governance differences as barriers to interoperability. It suggests that aligning schemes around shared technical standards, such as ISO methodologies, could improve transparency and comparability.

Chapter 3. GHG emission drivers and improvement potential

The report analyses key drivers of emissions across fuel supply chains. For biofuels, emissions are driven by feedstock cultivation, fertiliser use, land-use change and process energy. Switching to low-emission energy, sustainable farming practices and carbon capture can significantly reduce emissions, with some pathways achieving near-zero or negative emissions. Typical corn ethanol emissions are around 45 gCO₂-eq/MJ, but could fall below 20% of fossil gasoline emissions with best available practices. For hydrogen, emissions depend on electricity carbon intensity for electrolysis and capture rates plus upstream emissions for fossil-based routes. Transport and conversion can contribute up to 85% of total emissions for traded hydrogen. Hydrogen-based fuels inherit these drivers and are sensitive to the source of CO₂ feedstock. The chapter also notes growing attention to non-GHG impacts, including biodiversity, water use and socio-economic factors, which are increasingly addressed through certification schemes.

Chapter 4. Conclusions and policy considerations

The report concludes that supply-chain GHG intensity at the point of delivery provides a robust, technology-neutral basis for comparing sustainable fuels. It recommends including production, transport, distribution and complete oxidation emissions within system boundaries, and treating indirect land-use change and other pathway-specific impacts through complementary policies. Establishing minimum GHG intensity thresholds, combined with tiered labelling systems, could reward better performance and drive continuous improvement. The report also emphasises the need for international cooperation, harmonised methodologies and stakeholder engagement to reduce market fragmentation, attract investment and support the gradual transition to net zero fuel systems.