Profile: Nordic Blue

“Diesel is dead and the only question is how long it will take”. So rang out a sub-head in the Financial Times on 1 August. All I can say is – don’t believe everything you read in the FT these days. For despite all the hullabaloo about Tesla and electric cars generally, fully electric car sales in the EU today account for less than 1% of total new car sales. And I know that France and the UK have both pledged to end sales of new petrol and diesel engines from 2040 – but that is more than two decades away. In 2039 I might well decide to buy a new diesel car – if only because the herd will be going for all-electric vehicles and the pump-price of diesel may well collapse as a result. It’s going to be mid-century, at the earliest, before we see all-electric cars dominating our roads. So – very far from dead, although perhaps slowly expiring.

Which is good news for one of the most recent members of the Social Stock Exchange, Nordic Blue Crude, soon to be renamed Nordic Blue Renewables. This Norwegian-based company, which shares my conviction that it’s premature to start writing the obituaries for diesel, is shortly going to start mass production of synthetic diesel, which provides a reduction in CO2 emissions of 85% (including the building of plant, otherwise the reduction is 100%), and a reduction in NOx (nitrogen oxides) compared to conventional diesel. According to the German technology company Sunfire, which develops and manufactures steam-electrolysers and is one of Nordic Blue’s partners, “about 3,000 products, which are currently made from crude oil, could be manufactured on the basis of Blue Crude [as the synthetic fuel is known] – from chewing gums and credit cards to sneakers and smartphones all the way to climate-neutral fuels”. The production process breaks down water into hydrogen and oxygen through reversible electrolysis via a steam-electrolyser. The hydrogen is then mixed with CO2 under pressure and in high temperatures. The resulting liquid is transparent, free from sulphur and has a very high cetane number of around 70, meaning fast ignition. With cars eradicating their emissions of CO2, Nordic Blue is going to give the conventional combustion engine a considerable extension of life. And over the course of the next two decades, the technology that Nordic Blue uses will inevitably advance. Like I said – it’s premature to give the final victory to electric-powered vehicles.

Gunnar Holen is CEO of Nordic Blue. I asked his view about the electric car revolution. Did he regard it as a threat to his incipient business? “Electric cars are no doubt a very good thing but it takes time to get a lot of them on the roads. There are only about 1.2 million hybrid and electric cars around compared to some 1.2 billion traditional vehicles. Our contribution to a cleaner world is that all those traditional vehicles can use our fuel without any adaptation being necessary, as well as airlines, shipping and other transport.”

Nordic Blue is in the preparation stage of its development. It has started engineering work on a plant at Herøya, a peninsula about 160 kilometres south-west of Oslo. Herøya has a large industrial park which contains one of Norsk Hydro’s major plants. Construction of the plant should start in April 2018 and production to commence in 2019. “We are in the process of raising finance at the moment and the initial target is €70 million for the first plant, which will produce 10 million litres,” says Holen. The larger aim is to have a capacity at Herøya of 100 million litres. That initial production volume would be sufficient to supply 13,000 cars with full tanks and thus avoid 21,000 tonnes of CO2 emissions.

One incentive for any would-be investor in Nordic Blue is the possibility of an eventual public flotation, although as Holen points out, that very much depends on the wishes of new investors who will have a greater say in the company’s strategic direction.

But if the supremacy of the all-electric vehicle has been vastly over-blown, one yearned-for consequence of the arrival and commercialisation of Nordic Blue is the likely death of palm oil biodiesel, which for Europe since the turn of the century has become a huge fuel source. Despite the Roundtable on Sustainable Palm Oil, the depredations caused by palm oil cultivation, driven on by the rapid growth of bio-diesel demand, are depressing to read of. Nordic Blue’s Impact Report states: “According to the World Wildlife Fund, an area equivalent to the size of 300 football fields of rainforest is cleared every hour to make way to produce palm oil.” With as much as 45% of all palm oil used in the EU going into biodiesel, we need Nordic Blue’s synthetic fuel in order to help preserve endangered habitats and species. To quote the company’s Impact Report: “In summary, our renewable fuels are a sensible CO2 neutral option at a time when the world is struggling to be environmentally friendly in a rational manner and to meet international convention targets.”

 

 

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