Techno-economic analysis of hydrogen-to-eSAF supply chain optimization in Switzerland from Renewable Energy production
This project conducts a comprehensive what-if techno-economic analysis to explore how different assumptions impact the viability of e-SAF production in Switzerland. The dual objectives are to decarbonize a major share of aviation fuel consumption by 2040 and to strengthen the country’s energy sovereignty through domestic renewable integration. This study optimizes an integrated hydrogen-to-eSAF supply chain, including on-site renewable electricity generation, water electrolysis for hydrogen, CO2 capture, and syngas synthesis. A cost modeling and optimization framework was developed to minimize e-SAF production costs under Swiss geographic and climatic constraints. Economic evaluations were performed to assess financial viability with a target internal rate of return (IRR) of 7%, consistent with moderate-risk infrastructure debt strategies. The objective is to produce 0.7 million tonnes of e-SAF annually, representing around 50% of Switzerland’s estimated jet fuel demand by 2040. However, reaching this target would necessitate a substantial amount of renewable energy input (40–41 TWh/year, nearly 70% of the country’s annual electricity consume nowadays) and significant capital investment. Economically, even under optimistic future cost assumptions, the modeled e-SAF supply chain cannot achieve the IRR objective without significant support. To bridge this gap, policy interventions such as production subsidies would be necessary to make the project financially viable. Monetizing by-products and surplus electricity was shown to improve the economic outlook. In fact, the by-products of e-SAF synthesis significantly boost revenue and can reduce the required direct subsidy. Under the base scenario, achieving cost competitiveness with kerosene would require a e-SAF price of approximately 2 CHF per kg, representing a 3.5 fold increase over current kerosene prices. A secondary strategy explores a business model in which the plant’s main revenue comes from selling electricity, with e-SAF production utilizing excess energy as a form of long-term energy storage. A selling price of 1.69 CHF per kg of e-SAF would be necessary to match the IRR of a power plant operating with comparable infrastructure and curtailing excess energy production. Overall, the analysis highlights that while a hydrogen-to-eSAF supply chain is technically feasible, it remains economically challenging. Strategic policy support and continued technological improvements are crucial for e-SAF to become a competitive and scalable solution for sustainable aviation in Switzerland.
Techno-economic analysis of hydrogen-to-eSAF supply chain optimization in Switzerland from Renewable Energy production.pdf
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