Biomethanol vs. E-Methanol: What Determines the Cost Crossover?

There is no single electricity price at which e-methanol becomes cheaper than biomethanol. A useful comparison needs two complete production routes, a common delivery boundary and the same financing assumptions.

Start with the correct production pathways

Biomethanol can be made from biomass-derived synthesis gas or biomethane; purchased renewable hydrogen is not an inherent requirement of every route. E-methanol combines hydrogen with a carbon feedstock, commonly captured CO₂. Electricity can supply the energy for hydrogen production and capture, but it does not create carbon.

IRENA and the Methanol Institute’s Innovation Outlook: Renewable Methanol is a 2021 technology reference, not a current price sheet. It describes approximately 0.19 tonnes of hydrogen and 1.38 tonnes of CO₂ per tonne of CO₂-based methanol, and an electricity requirement of about 10–11 MWh per tonne assuming CO₂ is supplied.¹

Make the cost boundary explicit

For an on-site hydrogen case, use:

E-methanol cost per tonne = electricity use × delivered electricity price + CO₂ input × delivered CO₂ price + other operating costs + annualized capital cost per tonne.

If hydrogen is purchased, replace the hydrogen-production electricity and capital components with the purchased hydrogen cost. Adding both would double-count hydrogen production.

For a biomass route, include delivered feedstock on a stated moisture and energy basis, preparation, conversion, utilities, residue handling and annualized capital. Deduct a by-product credit only when its basis and buyer are documented. Capturing or using CO₂ does not automatically create credit revenue.

This is an accounting structure, not a calibrated project model.

A reproducible sensitivity example

To isolate electricity exposure, assume 10 MWh of electricity per tonne of methanol and hold every other input constant. This is a selected scenario, not a measured plant result.

The arithmetic is price multiplied by 10. A USD 10/MWh change therefore changes this component by USD 100/t. None of these values is the total methanol cost.

A simplified crossover can be written as P = (B − R) / E*, where B is the complete biomethanol cost, R is the non-electricity cost of e-methanol and E is its electricity intensity. This only works if B and R are held constant. Actual operating hours, storage and financing may change with the power configuration, requiring a fuller model.

The earlier USD 40/MWh claim and the homepage’s roughly USD 60/MWh intersection did not share a documented calculation. Both have been withdrawn.

Compare the same customer and product claim

Biomethanol and e-methanol may serve the same buyer. Their suitability depends on the applicable sustainability and emissions rules, delivery specification and contract.

For covered shipping activity, FuelEU Maritime has applied since January 2025. It concerns lifecycle greenhouse-gas intensity and does not create a universal price premium for every tonne labelled green methanol.² CORSIA concerns international aviation; it should not be presented as a general marine-fuel requirement.³

The IMO’s 2023 strategy is distinct from adoption of the Net-Zero Framework. The adoption meeting was adjourned in October 2025 into 2026. Do not treat the proposed framework as a settled revenue stream in a project model.⁴

What a useful comparison needs next

Request dated feedstock and electricity offers, a documented mass balance, expected operating hours, capital scope and a buyer’s required certification pathway. Model premiums separately from physical production cost. A supplier or sponsor should be able to trace each input to a quote, engineering assumption or named publication.

Discuss a focused project brief →

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