As a result of the COVID-19 pandemic, motor racing fuel demand has suffered with many events canceled or postponed. Despite a solid rebound in 2021, fuel demand associated with the world’s major motor racing events is forecast to decline. Although there has been significant growth in the industry, the increasing number of racing events is largely offset by fuel efficiency improvements. Short distance rallying fuel demand is expected to see a slight decline in the coming years, as electrification is being pursued in this segment. Low-carbon fuels are seen as the gold standard in hard-to-electrify competitions.
Motor Racing Fuel Demand
In the last five years, the number of international motor racing events increased, especially in the automotive segment, with the Middle East taking much of the spotlight. However, environmental concerns have pushed the motor racing industry to speed up greenhouse gas (GHG) emission reductions at most recognized international events. The introduction of fuel consumption limitations has optimized fuel use, while electric technology has further improved internal combustion engine overall performance by reducing fuel consumption and maximizing power generation. As a result, European and North American racing fuel demand is forecast to decline, while the Middle East is seeing significant demand growth after the Dakar rally moved to Saudi Arabia in 2020.
Low Carbon Fuels Consumption in Motor Racing Competitions
Not all racing events are equally suitable for full electrification. Almost half of the major competitions announced a shift to low carbon fuels in the past few years, mainly through biofuels and hybrid technology. In long-distance racing-type events, battery-fueled vehicle performance is constrained by limited storage capacity and high logistical costs for power supply and power generation. Biofuels, however, have been used for several years now in some of the major U.S.-based long-distance racing-type events (e.g., IndyCar, Nascar) and, together with synthetic fuels, are projected to lead most of the FIA (International Automobile Federation) and FIM (International Motorcycling Federation) decarbonization strategies through 2030.
By the end of 2022, low carbon fuel demand across major global racing events is estimated to account for 28% of the total share, almost tripling low carbon fuel content in total demand compared with 2015 levels. Moreover, further growth is projected through 2030, with Formula One and Moto GP series switching to 100% synthetic fuels and progressive biofuel and synthetic fuel standardization in long-distance racing-type events such as the Dakar Rally.
In 2022, the introduction of low-carbon fuel in Dakar's T1 vehicle class is expected to raise fuel costs significantly. Depending on fuel choice, prices could increase more than twentyfold for gasoline-fueled vehicles and by a factor of 2.5 for diesel-fueled engines. Transportation costs, however, are not expected to change substantially. Supply chain networks are in place as special fuel blends for top contenders are already exported from Europe currently, where some of the larger low-carbon fuel producers are located. In the two-wheeler segment, low carbon fuels rollout is not expected to cause a significant disruption in fuel costs. High-performance motorcycling fuel prices typically exceeds 6 EUR/liter, nearing P1's sustainable fuel supplied to the WRC.
Unlike top international competitions, in regional classes, typically tight budgets will prevent the introduction of low carbon fuels or hybrid technology. In the long-term, cost reductions are projected for synthetic fuels, particularly when made from green hydrogen, making this fuel more attractive for low-budget racing-type events.
Currently, specifications for racing fuels are set by FIA and FIM fuels regulations, particularly for gasoline, diesel, biodiesel and hydrogen. The FIA regulations also include specifications for advanced sustainable (AS) petrol and diesel, where AS fuel comprises solely AS components that are composed of certified compounds and refinery streams, and fuel additives. An AS component is one that is derived from a carbon capture scheme, such as e-fuel, (approved by the FIA), municipal waste, or non-food biomass, that achieves a GHG emissions savings, relative to fossil-derived gasoline, of at least 65%. An AS petrol must contain a minimum of 70% AS component, while an AS diesel is a biodiesel, HVO or diesel from a carbon capture process that complies with the AS fuel definition.
The FIA and FIM fuel specifications are similar to the European Committee for Standardization (CEN) standards i.e. EN 228 for gasoline, EN 590 for diesel, EN 15940 for paraffinic diesel and EN 14214 for biodiesel. Comparing with EN 228 for gasoline, both FIA and FIM specifications set RON at a minimum of 95.0 and maximum of 102.0, while EN 228 sets only a minimum level of RON 95. In addition, the FIA regulations set a limit for methanol blending at 3.0 vol%, but not for other oxygenates like ethanol and ethers. On the other hand, the FIM regulations set the same limits as EN 228 for all oxygenates but also specify that the only other oxygenates permitted are paraffinic mono-alcohols and paraffinic mono-ethers (of 5 or more carbon atoms per molecule) with a final boiling point below 210°C. Furthermore, the FIA regulations indicate that octane boosting nitro compounds are not permitted and hence set a limit for nitrogen at 500 ppm max, while FIM regulations set it at 0.2 wt% max.
Current Select FIA and FIM Gasoline Specifications
Stratas Advisors’ Views
Motor racing fans will be thrilled by an increasing number of all-electric events. Short-distance racing-type competitions will benefit from electric-powered vehicles' instant torque and power. However, there is still a long way to go on overall battery performance for all-electric powertrains entering the long-distance racing segment. Synfuels and biofuels, however, are expected to play a significant role in long-distance racing-type cars and motorcycles through 2030. Production costs are expected to decline somewhat due to large-scale deployment, while many green credentials can be currently scored for a manageable price premium.