Green hydrogen, a solution to decarbonise heavy mobility

Listen to the podcast (in French)

Erik Orsenna

Today we meet with a company manufacturing synthetic fuels, which are obviously very useful for boats or for airplanes.
This company is located in the heart of industrial Germany, in Karlsruhe and is called Ineratec. The boss and founder of this company is called Tim Böeltken.

Tim Böltken

It is a pleasure to be here with you today. As you mentioned, I am Tim Boeltken and I am a trained chemical engineer, with a PhD in chemical engineering. I am the father of one son and this is actually what pushes me to do something for the environment. I am really concerned about where we are heading and in the end, our mission and vision is to provide a liveable future on the planet, not only for our generation but the generations to come. 
This is why we started Ineratec in 2016, which is a deep-tech chemical company working in the field of climate technology and what we do essentially is we build very compact modular machines.

How many are you at Ineratec? Are you already a giant corporation or just a small group, a commando of sorts?

Tim Böltken 

We were officially incorporated in 2016 and we now have approximately 130 people.

Erik Orsenna

That's not bad ! And I imagine that you will still grow.

Tim Böltken

It has grown a lot in recent years but the technology is really needed and needs to be deployed very fast now, so we need to grow even quicker.

Erik Orsenna

Without going into technical detail, how do you make this magic fuel?

Tim Böltken

Everyone is talking about decarbonisation and decarbonising the planet and most of the discussions are just about direct electrification. We talk about battery electric cars and heat pumps, but we have to keep in mind that there are a lot of sectors in the world that cannot be directly electrified, such as aviation, shipping, heavy-duty transport but also the chemical sector. An electron is not a material you can touch and the energy density is not very high. What we do is build machines that enable us to electrify these sectors indirectly by using renewable electricity that is converted into green hydrogen. We use the green electricity to split water, to generate green hydrogen, and then we take the greenhouse gas CO2, which nobody wants and that is just in the atmosphere and our machines convert these two gases very efficiently into synthetic fuels. These are called ‘e-fuels’ or ‘electrofuels’ because they are like the normal fuels that we can all use in our existing infrastructures but it is produced from renewable electricity. That is actually the way to really not decarbonise, but defossilise the sectors that cannot be directly electrified.

Erik Orsenna

It sounds like you are a creator, God himself! Are you completely changing the laws of nature?

Tim Böltken

Interestingly, it is not god-like it is pure chemistry and the processes behind that have been known for ages. We are talking about processes like reverse water gas shift, Fischer Tropsch synthesis, methanol synthesis, which are all well- known, but have only been used in fossil applications over the past 150 years. In the past, we used them with coal or natural gas, so it was a fossil-based feedstock and what we have done is change the feedstock to CO2, carbon dioxide, which nobody wants, and green hydrogen. By doing that we have actually reversed the natural process pathway, so we are generating what were formerly fossil fuels on a renewable pathway. That means we substitute today’s fossil crude oil consumption by a future renewable CO2 neutral feedstock. All the studies show that we need to do this to achieve our Paris climate goals and to ramp up now because betting solely on direct electrification will not achieve those goals and will be more costly than parallel pathways.

Erik Orsenna

In the past transitions have always taken time, sometimes millions of years. Due to human activity, the transition is accelerating, with this accumulation of carbon in the atmosphere. To respond to this acceleration, we ourselves must accelerate the decarbonization. We have talked a lot about space in globalization, we must now tackle time.

Tim Böltken

Exactly, renewable energies have been such a huge success because we were not thinking about economies of scale. Renewable energy is a very modular technology so a lot of people in the world are starting to implement windfarms and solar parks. They were so successful not because for instance, in France somebody said "let us build one huge windmill in the middle of France that will provide power for everyone", but because people all over the world could actually make a start, without waiting for all the regulations to be in place, they actually kept going. Our technology is now modular as well, which means we are rethinking the chemical industry and can take our technology to the sites in the world where you can produce very efficiently and cheaply because you have very good access to renewable energies, wind, solar and water. We can take our technology to those sites and then convert the renewable electricity and the green hydrogen onsite into these synthetic fuels.
The nice thing about these fuels is that they are compatible with the existing infrastructure so we do not need to change the ways we transport the fuels, refine them in existing refineries, and then transport the fuels to the end-users. We have 1.4 to 1.6 billion cars being driven in the world today and they will still be there in 2050 . We have so many planes flying around with existing engines and infrastructure, which actually need these renewable fuels, and ships with normal diesel engines. They all need these fuels because we will not be able to change the entire infrastructure by 2050. You need to keep one thing in mind, building up the entire infrastructure took us 250 years and it would be impossible to achieve a completely new infrastructure in just 25 years because 2050 is right around the corner. We need to consider using the existing infrastructure but making it renewable and this is actually our approach, we keep everything as it is, but we substitute the fossil feedstock with a completely CO2 neutral feedstock.

Erik Orsenna

Your task is gigantic! But are you profitable? And do you find sufficient funding to support you? Financing is all the more difficult to find these days since interest rates continue to climb.

Tim Böltken

Those are very good questions. We started in 2016 and we were bootstrapping the company, which means that the founders, not just me because there were three other founders, decided to only build something that was needed by the world but also by our customers. We were profitable over the early years of our incorporation but then we saw that to really scale-up the technology and pick up speed, we needed investment and to increase our capital. We did that and continue to do that and that means we can invest money in the technology. For example, we are currently investing EUR 40 million in our next-generation project, which will be located in Frankfurt and will be the biggest power to liquid or e-fuel production plant in the world. Of course, it will not be profitable immediately but once we are at-scale and have the technologies rolled out, our business model is extremely profitable.
Of course, this brings us to the financing and you do need the financial sector to finance these technologies, and it is becoming more and more difficult in these uncertain times. Also, money is not as cheap as it was two or three years ago, but the good thing is that there is a shared belief in the financial sector that these climate technologies need to be financed. Of course, the investments are more selective but we now have a very good process and I do not doubt that we will have access to the funding we need to actually deploy our technology on a world scale. 

Erik Orsenna

Among your many shareholders, 2 are of particular interest to me. Safran, which participates in the manufacture of aircraft engines, and ENGIE, which is at the heart of the energy transition. Can you explain to me your direct, effective and I imagine almost daily collaboration with these two very special shareholders?

Tim Böltken

First of all, we not only have two investors, we have a huge selection of different investors and they are divided between financial investors and strategic investors. On the French side in particular, you mentioned two important investors who not only provide money but also actively participate in Ineratec and in bringing the technology forward. These strategic investors are aligned alongside our value chain. For our entire undertaking to be a success, we need partners like ENGIE, that produce renewable energies not only in France or Europe but globally. ENGIE is a huge global player in the production of renewable energies, but also more specifically in the production of renewable hydrogen. That means they also have targets to produce renewable hydrogen on a global scale because we need it to produce renewable fuels. You also mentioned Safran, which is an offtaker of the fuel as a turbine builder providing its products to the aviation industry, which also has decarbonisation or defossilisation goals. In the European Union and the US there are already certain quotas for these synthetic fuels to be used in the future. This is why Safran is also very interested in having the fuels to hand to do turbine testing and optimisation for these fuels and also to be a leading supplier in the future.

Erik Orsenna

What are your biggest challenges now?

Tim Böltken

The challenge is that we do not have the time. We scaled-up from laboratory to industrial scale in less than 10 years but  we do not have an additional 10 years where we can wait for the regulations to be in place and everything set. We need to get going now because otherwise we will miss our 2030 goals and even more our 2050 goals. We actually need to ramp up and our technology must not be the bottleneck, we can go into mass manufacturing and roll out our technology. What we need is access to cheap, green, renewable electricity and hydrogen and an entire process chain needs to built up for that. We need to be faster on that and ease the regulations so that renewable energy parks can be constructed and erected much faster.
We also need a political framework that does not hinder but actually accelerates the ramp up of green hydrogen. This is something we are currently challenging but with all the current regulations you are not really safe on the investment side, particularly in Europe, while other countries or areas of the world are much more pragmatic. For example, in the US there is the Inflation Reduction Act, where billions of dollars are being deployed to ramp up this technology while in the European Union we are still discussing the application of these fuels, if they should only be used for aviation only, aviation and shipping, ban internal combustion engines, etc. The US has just decided that by 2030 they want to have 3 billion gallons of these synthetic fuels, which is actually helping to accelerate this technology and to provide access to funding. However, it is not just the US that can save the world, in the European Union we are the technology leaders and rather than focusing on regulations we should focus on getting things done and implementing the technology, so that we are not just the political leader but also a technology leader because this technology will be needed on a global scale very soon.

Erik Orsenna

There have always been cycles between hot and cold periods. What is happening now is that these transitions are accelerating, with carbon becoming more and more important, and to respond to this accelerating transition we ourselves have to accelerate the decarbonization.

Tim Böltken

Exactly, it is not a battle of technologies, e-fuels, indirect electrification or synthetic fuels against battery electric solutions. We need to deploy all the solutions we have because the common global enemy is burning fossil fuels and we are part of the global infrastructure and economic system. We also need to make sure that the renewable energy, renewable fuels and everything we use are still also affordable. Having access to renewable energy is also an advantage over the competition and the population also needs access to these fuels. We have also seen what happens in different countries if fuel prices rise tremendously and there are riots, etc., so we need to unite everyone behind our huge task of being carbon neutral by 2050. It is a huge task, and we have to bet on several horses in parallel to get things going because, as I mentioned, we have 25 years to make up for everything we have done in the past 150 years.

Erik Orsenna

Given the huge task you have to perform, do you have enough skills? Are young people trained enough in universities to answer these questions?

Tim Böltken

One advantage we have is that we are a spin-off from the Karlsruhe Institute of Technology and we are sitting on two decades of very intensive, in-depth research and development. That means we did not have to do the invention all on our own, we actually had access to IP and know-how. Then, of course, we have access to young students, really bright minds who join us because they do not want to work for a global fossil-based chemical industry but have an impact on life. They join us, we have huge traction for young, bright minds, but also experienced people who help us to scale the company. It is also very important to understand that we do not have to train everyone because the chemical processes are known. Whether you are a chemical, mechanical or electrical engineer with a certain background, you can contribute your knowledge to building Ineratec and we nurture this. Of course, like any high-tech company in Europe, there is a huge demand for highly-trained personnel, and I would not be honest if I did not say there are too few of them, but the only thing we can do is to advertise and say that we really need this technology and the personnel to grow the company further. I am very optimistic about that because I have seen some very good signs and if we really mean it seriously, the future is very bright.

Erik Orsenna

Young people today, as we know, want to give meaning to their work. A company like Ineratec must attract them.

Tim Böltken

Exactly. We have a mission to create a multi-megaton CO2 recycling potential and all the processes we apply are completely green. We are really working towards a liveable planet and we have the vision to really provide access to affordable, reliable, sustainable and post-fossil energy for all. This is precisely something that not only young people but also experienced ones want to work for and we are actually doing our best to provide common ground for them here in our company.

Erik Orsenna

You were created in 2016. For your 10th anniversary in 2026, how many employees do you expect to have?

Tim Böltken

Company growth is not only about hiring people and growing the headcount because the organisation also needs to be stable. We have grown quite a lot over past years and, as I said, from 2016 to 2023 we grew from one to 130 personnel, which is a huge acceleration. My idea is to have around 200 people in the Ineratec core company but of course, with all the financing rounds we are doing we have a number of M&A candidates in our portfolio, so we are constantly looking at the acquisition of supplementary companies that can contribute to our company goals. The company will grow, the structure will grow and we will always have a demand for highly-skilled and trained personnel.

Erik Orsenna

Thank you Tim. I might see you soon, because I am one of the very rare writers, and even rarer academics, who likes to visit factories. I like people who invent, those who produce the future, and if there is someone who produces a sustainable future, it is certainly you!

Tim Böltken

You will always be welcome. Thank you for this interview.