What the Loophole Is — and Why It Matters Beyond Aviation

The contested interpretation would allow green hydrogen injected into conventional biofuel hydrotreating processes to be credited as if it had produced e-SAF — a Power-to-Liquid RFNBO product. Critics argue this conflates two fundamentally different production pathways and dilutes the additionality principle that underpins RFNBO certification under RED III. For PtL synthetic-petrol developers targeting road transport, the precedent is acutely sensitive: if RFNBO accounting can be stretched in aviation, regulators and competitors may attempt similar manoeuvres against the EU’s 2035 ICE exemption framework, which requires verifiably carbon-neutral e-fuels, not blended proxies.

The 2035 ICE exemption — secured after intense lobbying by OEMs including Porsche and backed by projects such as HIF Global’s Haru Oni plant — hinges on a strict definition of what counts as a renewable fuel of non-biological origin. Any softening of that definition in the SAF sub-mandate sets a template that regulators, member-state transposition lawyers, and certification bodies will cite across all RFNBO use cases, including pump-dispensed synthetic petrol.

Road-Transport Implications: Horse Powertrain, Pump Economics and AI Calibration

The road-transport synthetic-petrol case rests on precise fuel-quality guarantees. Horse Powertrain’s D20 methanol range-extender — 105 kW, 47% fuel-to-energy efficiency, Euro 7-compliant — illustrates how tightly modern ICE architectures are calibrated to specific fuel properties; AI-assisted engine calibration and pump-level demand modelling are already being used by powertrain developers to optimise combustion mapping for 100%-renewable fuels and to project regional rollout economics. A regulatory framework that allows off-spec hydrogen pathways to masquerade as RFNBO feedstocks would introduce uncertainty into the very fuel-specification chain these systems depend on.

The efficiency objection to e-fuels in road transport deserves a frank statement: a PtL powertrain converts roughly 13–20% of upstream renewable electricity into motion, versus 70–80% for a battery-electric vehicle — approximately five times more electricity per kilometre. That is the core argument of Transport & Environment and the ICCT, and it is not trivial. The honest answer is that e-fuels are not competing with BEVs for new urban cars; their value lies in serving the approximately 1.4 billion combustion vehicles already on the road, long-haul heavy trucking, and sectors where battery energy density remains prohibitive. Pump-parity economics with natural hydrogen — geological H₂ requiring no electrolysis electricity — could further improve the cost picture if white-hydrogen supply scales.

Regulatory Integrity as a Commercial Asset

EASA’s 2026 ReFuelEU annual report confirmed that EU SAF supply reached 1.1 Mt (2.8%) in 2025, surpassing the mandatory 2% threshold — a milestone that validates compliance infrastructure but also raises the stakes for sub-mandate definitions. If the Commission accepts hydrogen-in-hydrotreatment as e-SAF, the 2030 and 2035 sub-mandate ratchets become easier to game, deflating the investment signal for genuine PtL capacity.

For synthetic-petrol stakeholders, the open letter is a useful compliance bellwether: the more rigorous the RFNBO gatekeeping in aviation, the more defensible the 2035 ICE road exemption becomes in future review cycles. Project developers, legal teams and policy officers should track the Commission’s formal response as a leading indicator of how strictly RFNBO additionality will be enforced across all transport modes.

Sources

• EU sustainable aviation fuel supply exceeds 2025 ReFuelEU Aviation target | EASA

Featured image via Unsplash.