XFuel

Co-authored with Nick Grossman

Transportation, including road, rail, air, and marine, has a greater reliance on fossil fuels than any other sector. It accounts for 37% of CO2 emissions from end-uses. Electrification has been the preferred strategy to decarbonize small passenger vehicles, but electrification becomes more difficult as the mass and the range of the vehicle increase. 

There is currently no agreement on which decarbonization methods to adopt for long-haul transportation. Some options are hydrogen, ammonia, e-fuels, biofuels, onboard nuclear (for ships), or point source carbon capture. It is likely that we need a portfolio of all of these solutions to meet massive and growing demand. But immediate and large-scale decarbonization can be achieved by drop-in low-carbon fuels that (1) integrate with the well-established existing infrastructure and (2) are cost-competitive with today’s fossil fuels – in most transit industries, fuel represents a large portion of costs (35% on average). 

Biofuels, which are produced from organic material, fit both criteria. However, biofuels are only as sustainable as the feedstock used to produce them. The use of some feedstock, such as palm and corn, can contribute to food insecurity and biodiversity loss, while the use of other sources can actually reduce net emissions released into the atmosphere. An example of a more climate-friendly source of biofuels is sustainable waste biomass from construction, agriculture, and forestry. Utilizing waste biomass for biofuel production solves two climate problems: accessing clean fossil-free fuel and limiting emissions from biomass incineration or decay. Deadwood alone emits around 10.9 gigatons of carbon annually – equal to approximately 115% of fossil fuel emissions. And this is what XFuel, our recent investment from our Climate Fund, is doing.

XFuel produces sustainable low-carbon drop-in fuels for the road, marine, and aviation transport sectors. Their biosynthetic fuels are made from solid biomass waste sources such as manufacturing, construction, forestry, and agriculture. Using modular and scalable biorefineries, XFuel can produce high-grade and cost-competitive fuels that integrate with existing infrastructure and engines without requiring significant capital investment. XFuel’s technology can deliver fuel with more than 85% GHG savings. Current R&D efforts show a potential to deliver carbon-negative fuels in the future. 
We are excited to back XFuel and the compelling team led by Nicholas Ball. We are co-investing alongside AENU (ex-Pirate Impact Capital), SOSV, and existing investors. If you’re interested in being part of XFuel and working on a massive global opportunity, the team is actively hiring.

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