Solutions for visualizing, understanding, and streamlining carbon emissions from various angles, such as business sites and products, corporate activities, and consumer behavior.
Efforts to conserve energy have been underway for several decades, but in recent years, the methods used have become more sophisticated, including AI and other technologies and billing methods based on usage. These solutions optimize energy usage.
Solutions related to batteries and hydrogen, such as electrification (EV) of mobility (means of transportation) such as cars and buses, which used to be fueled by gasoline, to reduce CO2 emissions, and to extract hydrogen for industrial use and to encourage its practical application.
Solutions related to batteries and hydrogen, such as electrification (EV) of mobility (means of transportation) such as cars and buses, which used to be fueled by gasoline, to reduce CO2 emissions, and to extract hydrogen for industrial use and to encourage its practical application.
Solutions that contribute to the fixation and absorption of CO2 in the atmosphere through forest protection and forest management, and offset the amount of greenhouse gas emissions that cannot be fully reduced through the purchase of carbon credits.
One solution is to reduce emissions in society as a whole by recycling metals, plastics, and other resources and products at various stages of economic activities.
Pioneering the Power-to-X Future: Launch of the World's First Commercial e-Methanol Plant
e-Methanol is synthesized using green hydrogen—produced from water with renewable energy—and green CO2 derived from biomass. Compared to traditional production methods, it is said to reduce greenhouse gas (GHG) emissions by over 95%. Mitsui & Co. has launched the world's first commercial-scale e-methanol production in Denmark in collaboration with European Energy. In this article, we speak with the project team to learn about the basics of e-methanol, the unique features of the plant, and the outlook for the future.
Mitsui is advancing this landmark project—the first and largest commercial production of e-methanol globally—through a joint effort between two of its business divisions. One is the Methanol & Ammonia Division of the Basic Materials Business Unit, which specializes in trading of methanol and participates in the methanol production business. The second is the Division IV of the Infrastructure Projects Business Unit, which excels in infrastructure and facility development. While this is a globally significant project, what exactly is driving the growing attention toward e-methanol?
EU Maritime Sector at the Forefront of Growing Low-Carbon Fuel Demand
--There's increasing interest in low-carbon fuels such as e-methanol. Could you explain the background behind this trend?
Miyamoto: In Europe, decarbonization efforts are accelerating and regulations are tightening. One well-known initiative is the "Fit for 55" policy package, which aims to reduce GHG emissions by 55% compared to 1990 levels by 2030. As part of this, the EU has been strengthening and expanding the EU Emissions Trading System (EU-ETS), which has been in place since 2005.
In terms of low-carbon fuel developments, the scope of the EU-ETS was expanded in January 2024 to include the maritime sector. Now, carbon pricing applies to GHG emissions from ships entering and leaving EU ports. Additionally, the "FuelEU Maritime" regulation, which mandates GHG reductions in marine fuel, has also come into effect from January 2025.
Yusufu Diaw Miyamoto
Europe & Australia Business Dept., Div. IV, Infrastructure Projects Business Unit, Mitsui & Co.,Ltd.
Joined in 2024. Involved in new business development in Europe, including the Kasso project.
--Are these regulations particularly strict for the shipping industry?
Miyamoto: The targets under FuelEU Maritime increase every five years. The initial reduction target in 2025 is just 2% compared to 2020 levels, so the immediate impact is relatively minor. However, by 2030 the target increases to 6%, and it continues to double roughly every five years—reaching an 80% reduction by 2050 compared to 2020 levels. Because of this, serious long-term efforts are essential.
Main Types and Characteristics of Low-Carbon Fuels
--What kind of low-carbon fuels are available for use in ships?
Fukuzawa: There are four main types: low-carbon methanol (including bio-methanol and e-methanol), biodiesel, LNG, and low-carbon ammonia.
Low-carbon fuels for ships
--Could you briefly explain the characteristics of each?
Fukuzawa: Biodiesel can be used without major modifications to existing ships. However, the supply of feedstocks such as used cooking oil is limited, and costs are rising.
On the other hand, using low-carbon methanol, LNG, or green ammonia typically requires ship modifications or the construction of new vessels. Also, LNG and ammonia are gases at room temperature, so they must be stored and transported under low temperatures or high pressure. Ammonia additionally requires careful handling due to its toxicity and odor.
In contrast, low-carbon methanol is a liquid at room temperature, making it easier to handle and transport.
Eiji Fukuzawa
Deputy General Manager, Low-Carbon Chemical Business Development Dept., Methanol & Ammonia Div., Basic Materials Business Unit, Mitsui & Co.,Ltd.
Joined the company in 2007. He has worked in global commodity chemical trading, power generation projects in the Middle East, and methanol production and sales development in the U.S. Since September 2023, he has been engaged in enhancing operations for the Kasso project and developing low-carbon methanol businesses globally.
--Methanol is a familiar fuel, but I'm surprised it can power ships.
Fukuzawa: It is possible for ships to operate almost entirely on methanol. However, the quantity of methanol required to travel the same distance is about 2.5 times that of heavy oil in volume. In other words, its energy density is less than half that of heavy fuel oil.
--So the fuel tank would need to be 2.5 times larger?
Fukuzawa: In theory, yes. In practice, a dual fuel (DF) ship is used, where two types of fuel tanks are installed, and fuels are used selectively. For example, heavy fuel oil and methanol, or heavy fuel oil and ammonia.
--With these four main fuel types, how are shipping companies forming their strategies?
Kaneko: It depends on the type of vessel, the route it sails, when the ship is built, and when the increasingly stringent regulations come into effect. Building a ship is a major investment in both time and money, and fuel procurement costs vary, so each company is taking a different approach. As suppliers, we are also observing market trends closely as we consider investment strategies.
Taiha Kaneko
Manager, Low-Carbon Chemical Business Development Dept., Methanol & Ammonia Div., Basic Materials Business Unit, Mitsui & Co.,Ltd.
After graduating from university, worked in the legal department of an automobile manufacturer. Joined Mitsui & Co. in December 2023 and is currently supporting the start-up of the Kasso project.
--These are clearly complex decisions. Container ships call at ports all over the world. How broadly do EU regulations apply?
Fukuzawa: Any vessel calling at a port in an EU member state must comply with the regulations. Ships operating exclusively between member state ports are subject to regulation for 100% of their fuel consumption. For those arriving from outside the region—such as from Asia—50% of the fuel used on the voyage is covered. In short, intra-European routes are regulated in full, while voyages between Europe and other parts of the world are regulated at a 50% level.
--Will this trend spread to other countries in the future?
Fukuzawa: The International Maritime Organization (IMO), a specialized agency of the United Nations, reached a basic agreement on reducing GHG emissions in April this year, and it is expected to be adopted in October. In addition, an intergovernmental negotiation called the "Green Shipping Corridor" is underway to study GHG emission reductions in shipping routes between the two countries.
Types of Low-Carbon Methanol and the Advantages of e-Methanol
--There are two types of low-carbon methanol: e-methanol and bio-methanol. What are the differences?
Kaneko: The difference is in the manufacturing process. Conventional methanol is made from natural gas. Bio-methanol is produced by thermally fermenting biomass such as food waste, straw, wood chips, or municipal waste to obtain carbon monoxide, carbon dioxide, and hydrogen, which are then synthesized into methanol.
e-Methanol is unique in that it uses renewable energy. It is produced by combining hydrogen obtained through water electrolysis using renewable electricity with green CO2 derived from biomass.
Comparing e-methanol and bio-methanol
--What are the advantages of e-methanol?
Kaneko: Its GHG emission reduction rate. While bio-methanol varies depending on feedstock, it typically reduces emissions by 70–80% compared to fossil fuels. e-Methanol, depending on production conditions, can achieve reductions of around 95%.
Moreover, the EU mandates the use of RFNBOs (Renewable Fuels of Non-Biological Origin) in the transport sector. For example, under the European Commission's Renewable Energy Directive III, member states are required to ensure that at least 1% of transport fuels come from RFNBOs by 2030. Additionally, FuelEU Maritime will mandate that 2% of marine fuels be RFNBOs starting in 2034.
Bio-methanol cannot meet this requirement, and e-methanol has an advantage in meeting future regulations.
--Mitsui invested in "Solar Park Kasso APS" together with European Energy for the production of e-methanol. What was the reason behind this investment?
Fukuzawa: We have long been in the methanol business. In the United States and Saudi Arabia, we produce a total of more than 3 million tons of methanol annually using traditional methods. However, with the rising decarbonization movement—particularly in the EU—we expect long-term demand for e-methanol to grow, starting with marine fuel and expanding to land and air transportation, as well as chemicals. That's why we chose to invest in the EU, the anticipated center of demand.
Power-to-X: Converting Renewable Energy into Gases, Liquid Fuels, and Chemicals
--What kind of company is European Energy?
Furuyama: They are a developer that builds and operates renewable energy power plants. Their business model is based on generating revenue from electricity sales and capital gains from selling developed power plants to financial investors and other buyers.
Naoya Furuyama
Deputy General Manager, Europe & Australia Business Dept., Div. IV, Infrastructure Projects Business Unit, Mitsui & Co.,Ltd.
Joined the company in 2011. Has experience in logistics infrastructure, New Downstream businesses in Japan, and on-site/off-site PPA projects using renewable energy. Since August 2024, he has been responsible for new business development in Europe, including the Kasso project.
--What is the background behind the creation of Solar Park Kasso?
Furuyama: In countries where renewable energy is thriving, there's growing interest in "Power-to-X" projects. The idea is to convert renewable energy into more value-added, low-carbon fuels and chemicals. Both European Energy and the Danish government are actively engaged in such efforts, which led to the launch of Solar Park Kasso.
--This plant is described as the world's first and largest e-methanol production facility. What are its key features?
Furuyama: One standout feature is that the plant is located adjacent to a solar power facility owned by Solar Park Kasso. Solar power generation fluctuates with sunlight conditions, and electricity prices can even become negative depending on supply-demand dynamics. We adjust the operation of the e-methanol plant based on solar power output and electricity prices to optimize operations and reduce production costs.
The Kasso e-methanol facility in Denmark – Image courtesy of European Energy
--Is the adjacent solar power plant used exclusively for the e-methanol facility?
Furuyama: It is partly used for e-methanol production, but surplus power is also sold to the grid at times. Conversely, the plant sometimes purchases power from the electricity market when needed.
--Where is the carbon dioxide used as feedstock sourced from?
Furuyama: We use "green CO2" produced by fermenting livestock manure collected from nearby farms. Denmark is a dairy farming country, and the location of the plant is one of the areas where green CO2 can be easily collected.
Driving Project Success Through Methanol Expertise and Integrated Capabilities
--What is the role of Mitsui in this project?
Kaneko: European Energy had no prior experience handling methanol. They are relying on our expertise in it, including marketing and commercial knowledge.
Currently, we are working with various divisions at Mitsui, including our Mobility Division II, which specializes in shipping, to engage with potential customers such as shipping and chemical companies.
Furuyama: Our Infrastructure Projects Business Unit also brings strengths in areas such as HSE (Health, Safety, and Environment), management, construction execution, solar plant operation optimization, and financial efficiency. These capabilities are actively contributing to the project.
Fukuzawa: We have a proven track record not only in renewable energy, but also in chemical plant development. At Solar Park Kasso, we are delivering the value of Mitsui's comprehensive capabilities.
--In addition to Mitsui, major global companies like global shipping leader Maersk, LEGO Group and pharmaceutical giant Novo Nordisk are also buyers. How are they using e-methanol?
Kaneko: Both LEGO Group and Novo Nordisk use it as a feedstock for polyoxymethylene (POM), a high-strength material. LEGO uses POM in components like axles that connect tires on LEGO bricks. Novo Nordisk plans to use it for insulin pens and other medical devices.
--What are your future plans?
Fukuzawa: The global momentum for decarbonization is here to stay. We intend to leverage the knowledge we've gained through our methanol business to meet the rising demand for low-carbon solutions. This is also our opportunity to embrace the Power-to-X movement. These represent two new frontiers for us.
To do that, we're focused on ensuring the success of the Solar Park Kasso project.
Leaving a Better Planet for Future Generations
--Lastly, what is your dream that you would like to achieve through this business?
Kaneko: One of methanol's strengths is its versatility—it's used in everything from daily goods to fuel. Most methanol today is fossil-based, but I envision a future where e-methanol replaces it and becomes widespread, even in everyday products.
Fukuzawa: I hope that e-methanol, with its eco-friendly production process, becomes more familiar and accessible. When that day comes, I'd love to proudly tell my children, "I was involved in the world's first commercial e-methanol plant"(laughs).
Furuyama: I, too, want to leave a better planet for our children. I feel fortunate to be involved in a project that contributes to that goal. It's also a privilege to be part of a team taking on the challenge of a world first. I am committed to seeing this project succeed.
Miyamoto: This is only my second year at Mitsui, but I am grateful for the opportunity to be involved in large-scale and meaningful projects, and I want to help spread the use of e-methanol throughout society and pass it on to the next generation.
