Whether you agree that carbon dioxide is fueling climate change or not, it is pretty clear that we should be emitting less of this greenhouse gas. The problem with being a more green society is that it costs more than our current fossil fuel-based approach. That could be about to change as new breakthroughs in science and technology are turning carbon dioxide emissions into something that can be utilized to fuel an economic benefit.
The most recent breakthrough in chemistry has found a way to convert carbon dioxide into methanol, which is a simple alcohol that can be used as a transportation fuel among other uses. This new method would use captured carbon to create a fuel that would cost less than gasoline. Further, it could replace the current costly approach, where this captured greenhouse gas is injected into the ground to sequester it by utilizing it to fuel our economy.
Methanol is a high-performing fuel with an octane rating of 100. The original methanol-to-gasoline process was developed by ExxonMobil in the 1970s during the oil crisis. At one point automakers were even developing flex-fuel vehicles capable of running on methanol. Not only that, but it was long favored by the racing industry, fueling the Indianapolis 500 for decades. Overall, it's much cheaper per mile than gasoline or ethanol. Further, unlike ethanol, it wouldn't cut into the corn supply needed for food production.
Methanol has a variety of uses such as in the production of formaldehyde, acetic acid, and other chemicals. Unfortunately, we don't produce a whole lot of it in the U.S. and are therefore required to import about 89% of our supply. Overall, the U.S. represents 10% of the global methanol market, which is growing about 7% per year, meaning there's a lot of opportunity for American companies to increase production.
Refining giant Valero is planning to do just that. The only difference is that it plans to upgrade natural gas into methanol, which is a much more proven approach. Not only would Valero's planned construction of a world-scale methanol plant help meet growing U.S. demand, but its products could serve the growing export market, with Asia an especially strong market for methanol. Valero has expansive export capacity already as it's a leader in exporting gasoline and diesel.
Overall, methanol is a more cost-efficient way to export natural gas as it's a higher-value product and already liquefied. That's part of the reason why there is still a lot of debate as to whether we should allow unabated natural gas exports. Many manufacturers believe we should use our low-cost natural gas to produce a higher-valued product like steel or other chemicals and export those instead. Upgrading natural gas to methanol instead of exporting just raw natural gas is another example of why some suggest we should keep our gas for our own consumption as it would be more of an economic benefit to upgrade gas first.
Taking that a step further and one day exporting our waste greenhouse gasses to the world in a form of viable gasoline substitute would be a real coup. Many cars in Europe already run on gasoline mixed with methanol. That's really the only viable option at the moment as it will be tough for the fuel to break ethanol's current dominance in the U.S. due to the federal subsidies it receives.
A lot still needs to happen to see a greenhouse gas like carbon dioxide someday fueling our cars. First, the playing field needs to be leveled giving a carbon dioxide-based methanol a chance to even compete against ethanol. In addition to that, there would have to be a real concerted effort that this is the fuel the nation wishes to use in the future.
That's no sure thing. Natural gas and electric are vying to be what fuels our vehicles. While both emit less greenhouse gases than the gasoline that currently fuels our cars, neither option solves the problem of what to do with captured carbon other than spending money to have it sequestered. That's why it would be nice to see this greenhouse gas utilized instead of just stored away. It's certainly something to watch, but I don't expect to see any greenhouse gases fueling my car for the foreseeable future.
We might already have our fuel of the future
Instead, I see natural gas playing a much larger role in fueling our economy. From being upgraded to methanol to being used as a transportation fuel, natural gas looks to have a big future. That's why I'm so intrigued by this little-known company which holds the key to the explosive profit power of the coming "no choice fuel revolution." Luckily, there's still time for you to get on board if you act quickly. All the details are inside an exclusive report from The Motley Fool. Click here for the full story!
The article Could This Greenhouse Gas One Day Fuel Your Car? originally appeared on Fool.com.Fool contributor Matt DiLallo has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.