The methanol economy is a suggested future economy in which methanol replaces fossil fuels as a means of energy storage, ground transportation fuel, and raw material for synthetic hydrocarbons and their products. It offers an alternative to the proposed hydrogen economy or ethanol economy.
In the 1990s Nobel prize winner George A. Olah started to advocate the methanol economy  and in 2006 he and two co-authors (G. K. Surya Prakash and Alain Goeppert) published a book around this theme. In these publications, they summarize the state of our fossil fuel and alternative energy sources, their availability and limitations before suggesting a new approach in the so-called methanol economy.
Methanol is a fuel for heat engines and fuel cells. Due to its high octane rating it can be used directly as a fuel in flex-fuel cars (including hybrid and plug-in hybrid vehicles) using existing internal combustion engines (ICE). Methanol can also be used as a fuel in fuel cells, either directly in Direct Methanol Fuel Cells (DMFC) or indirectly (after conversion into hydrogen by reforming).
Methanol is a liquid under normal conditions, allowing it to be stored, transported and dispensed easily, much like gasoline and diesel fuel is currently. It can also be readily transformed by dehydration into dimethyl ether, a diesel fuel substitute with a cetane number of 55.
Methanol is already used today on a large scale (about 37 million tonnes per year) as a raw material to produce numerous chemical products and materials. In addition, it can be readily converted in the methanol-to-olefin (MTO) process into ethylene and propylene, which can be used to produce synthetic hydrocarbons and their products, currently obtained from oil and natural gas.
Methanol can be efficiently produced from a wide variety of sources including still-abundant fossil fuels (natural gas, coal, oil shale, tar sands, etc.), but also agricultural products and municipal waste, wood and varied biomass. More importantly, it can also be made from chemical recycling of carbon dioxide, which Carbon Recycling International has demonstrated with its first commercial scale plant. Initially the major source will be the CO2 rich flue gases of fossil-fuel-burning power plants or exhaust from cement and other factories. In the longer range however, considering diminishing fossil fuel resources and the effect of their utilization on earth's atmosphere, even the low concentration of atmospheric CO2 itself could be captured and recycled via methanol, thus supplementing nature’s own photosynthetic cycle. Efficient new absorbents to capture atmospheric CO2 are being developed, mimicking plants' ability. Chemical recycling of CO2 to new fuels and materials could thus become feasible, making them renewable on the human timescale.
Methanol may be viewed as a compact way of storing hydrogen. One m3 of methanol at ambient pressure and temperature contains 1660 Nm3 (normal cubic metres) of hydrogen gas (H2). This may be compared to liquid hydrogen where one m3 of liquid hydrogen (LH2) at -253°C contains only 788 Nm3 of hydrogen gas 
Uses of methanol in a methanol economy 
Fuel uses 
In an economy based on methanol, methanol could be used as a fuel:
- In internal combustion engines (ICEs)
Methanol has a high octane rating (RON of 107 and MON of 92), making it a suitable gasoline substitute. It has a higher flame speed than gasoline, leading to higher efficiency as well as a higher latent heat of vaporization (3.7 times higher than gasoline), meaning that the heat generated by the engine can be removed more effectively, making it possible to use air cooled engines. Methanol burns cleaner than gasoline and is safer in the case of a fire, but has only half the volumetric energy content of gasoline (15.6 MJ/L vs. 32.4 MJ/L).
- In compression ignition engines (diesel engine)
Methanol itself is not a good substitute for diesel fuels. Methanol can, however, be converted by dehydration to dimethyl ether, which is a good diesel fuel with a cetane number of 55-60 as compared to 45-55 for regular diesel fuel. This improves its cold-start ability in winters and reduces its noise. Compared to diesel fuel, DME has much lower emissions of NOx and CO and emits no particulate matter, SOx. Methanol can also be, and is in fact already, used to produce biodiesel via transesterification of vegetable oil (SVO).
- In advanced methanol-powered vehicles
The use of methanol and dimethyl ether can be combined with hybrid and plug-in vehicle technologies allowing higher gas mileage and lower emissions. These fuels can also be used in fuel cells either via onboard reforming to hydrogen or directly in Direct Methanol Fuel Cells (DMFC).
- For electricity production
- As a domestic fuel
Methanol and DME can be used in commercial buildings and homes to generate heat and/or electricity. DME can be used in a commercial gas stove without modifications. DME can also be blended with LPG and used as a cooking or heating fuel as is already the case in China. In developing countries methanol could be used as a cooking fuel, burning much cleaner than wood and thus mitigating indoor air quality problems.
Raw material for chemicals and materials 
Methanol is already used today on a large scale as raw material to produce a variety of chemicals and products. Through the methanol-to-gasoline (MTG) process, it can be transformed into gasoline. Using the methanol-to-olefin (MTO) process, methanol can also be converted to ethylene and propylene, the two chemicals produced in largest amounts by the petrochemical industry. These are important building blocks for the production of essential polymers (LDPE, HDPE, PP) and like other chemical intermediates are currently produced mainly from petroleum feedstock. Their production from methanol could therefore reduce our dependency on petroleum. It would also make it possible to continue producing these chemicals when fossil fuels reserves are depleted.
Methanol production for a methanol economy 
The methanol needed in the methanol economy can be synthesized not only from a wide array of carbon sources including still available fossil fuels and biomass but also CO2 emitted from fossil fuel burning power plants and other industries and eventually even the CO2 contained in the air.
Today methanol is produced exclusively from methane through syngas. Although conventional natural gas resources are currently the preferred feedstock for the production of methanol, unconventional gas resources such as coalbed methane, tight sand gas and eventually the very large methane hydrate resources present under the continental shelves of the seas and Siberian and Canadian tundra could also be used. Besides methane all other conventional or unconventional (tar sands, oil shale,etc.) fossil fuels could be utilized to produce methanol.
Besides the conventional route to methanol from methane passing through syngas generation by steam reforming combined (or not) with partial oxidation, new and more efficient ways to produce methanol from methane are being developed. These include:
- Methane oxidation with homogeneous catalysts in sulfuric acid media
- Methane bromination followed by hydrolysis of the obtained bromomethane
- Direct oxidation of methane with oxygen
- Microbial or photochemical conversion of methane
The use of methane or another fossil fuel for the production of methanol using all the above mentioned synthetic routes has a potential drawback: the emission of the greenhouse gas carbon dioxide CO2. To mitigate this, methanol can be made through ways minimizing the emission of CO2. One solution is to produce it from syngas obtained by biomass gasification. For this purpose any biomass can be used including wood, wood wastes, grass, agricultural crops and their by-products, animal waste, aquatic plants and municipal waste. There is no need to use food crops as in the case of ethanol from corn, sugar cane and wheat.
- Biomass → Syngas (CO, CO2, H2) → CH3OH
More importantly, methanol can also be produced from CO2 by catalytic hydrogenation of CO2 with H2 where the hydrogen has been obtained from water electrolysis. Methanol may also be produced through CO2 electrochemical reduction, if electrical power is available. The energy needed for these reactions in order to be carbon neutral would come from renewable energy sources such as wind, hydroelectricity and solar as well as nuclear power. In effect, all of them allow free energy to be stored in easily transportable methanol, which is made immediately from hydrogen and carbon dioxide, rather than attempting to store energy in free hydrogen.
- CO2 + 3H2 → CH3OH + H2O
- CO2 +2H2O + electrons → CO + 2H2 (+ 3/2 O2) → CH3OH
The necessary CO2 would be captured from fossil fuel burning power plants and other industrial flue gases including cement factories. With diminishing fossil fuel resources and therefore CO2 emissions, the CO2 content in the air could also be used. Considering the low concentration of CO2 in air (0.037%) improved and economically viable technologies to absorb CO2 will have to be developed. This would allow the chemical recycling of CO2, thus mimicking nature’s photosynthesis.
Advantages over other energy storage media 
In the process of photosynthesis, green plants use the energy of sunlight to split water into free oxygen (which is released) and free hydrogen. Rather than attempt to store the hydrogen, plants immediately capture carbon dioxide from the air to allow the hydrogen to reduce it to storable fuels such as hydrocarbons (plant oils and terpenes) and polyalcohols (glycerol, sugars and starches). In the methanol economy, any process which similarly produces free hydrogen, proposes to immediately use it "captively" to reduce carbon dioxide into methanol, which, like plant products from photosynthesis, has great advantages in storage and transport over free hydrogen itself.
Advantages over hydrogen 
Methanol economy advantages compared to a hydrogen economy:
- Efficient energy storage by volume, as compared with compressed hydrogen. And when hydrogen pressure-confinement vessel is taken into account, an advantage in energy storage by weight can also be realized. The volumetric energy density of methanol is considerably higher than liquid hydrogen, in part because of the low density of liquid hydrogen of 71 grams/litre. Hence there is actually more hydrogen in a litre of methanol (99 grams/litre) than in a litre of liquid hydrogen, and methanol needs no cryogenic container maintained at a temperature of -253°C .
- A liquid hydrogen infrastructure would be prohibitively expensive. Methanol can use existing gasoline infrastructure with only limited modifications.
- Can be blended with gasoline (for example in M85, a mixture containing 85% methanol and 15% gasoline).
- User friendly. Hydrogen is volatile and requires high pressure or cryogenic system confinement.
- Less losses : making storage systems hydrogen leakage proof is a lot more difficult then preventing leakage from methanol. With liquid hydrogen heat will evaporate liquid, giving expected losses up to 0,3% per day in storage tanks due to release of overpressure (see Chart Ferox storage tanks Liquid oxygen).
Methanol economy advantages compared to ethanol 
- Can be made from any organic material using proven technology going through syngas. There is no need to use food crops and compete with food production. The amount of methanol that can be generated from biomass is much greater than ethanol.
- Can compete with and complement ethanol in a diversified energy marketplace. Methanol obtained from fossil fuels has a lower price than ethanol.
- Can be blended in gasoline like ethanol. In 2007, China blended more than 1 billion US gallons (3,800,000 m3) of methanol into fuel and will introduce methanol fuel standard by mid-2008. M85, a mixture of 85% methanol and 15% gasoline can be used much like E85 sold in some gas stations today.
Methanol economy disadvantages 
- High energy costs associated with generating hydrogen (when needed to synthesize methanol)
- Depending on the feedstock the generation in itself may be not clean
- Presently generated from syngas still dependent on fossil fuels (although in theory any energy source can be used).
- Energy density (by weight or volume) one half of that of gasoline and 24% less than ethanol
- Corrosive to some metals including aluminum, zinc and manganese. Parts of the engine fuel-intake systems are made from aluminum. Similar to ethanol, compatible material for fuel tanks, gasket and engine intake have to be used.
- As with similarly corrosive and hydrophilic ethanol, existing pipelines designed for petroleum products cannot handle methanol. Thus methanol requires shipment at higher energy cost in trucks and trains, until a whole new pipeline infrastructure can be built.
- Methanol, as an alcohol, increases the permeability of some plastics to fuel vapors (e.g. high-density polyethylene). This property of methanol has the possibility of increasing emissions of volatile organic compounds (VOCs) from fuel, which contributes to increased tropospheric ozone and possibly human exposure.
- Low volatility in cold weather: pure methanol-fueled engines can be difficult to start, and they run inefficiently until warmed up. This is why a mixture containing 85% methanol and 15% gasoline called M85 is generally used in ICEs. The gasoline allows the engine to start even at lower temperatures.
- Methanol is generally considered toxic. Methanol is in fact toxic and eventually lethal when ingested in larger amounts (30 to 100 mL). But so are most motor fuels, including gasoline (120 to 300 mL) and diesel fuel. Gasoline also contains many compounds known to be carcinogenic (e.g. benzene). Methanol is not a carcinogen, nor does it contain any carcinogens. However, methanol may be metabolized in the body to formaldehyde, which is both toxic and carcinogenic. Methanol occurs naturally in small quantities in the human body and in edible fruits.
- Methanol is a liquid: this creates a greater fire risk compared to hydrogen in open spaces. Methanol leaks do not dissipate. A methanol-based fire burns invisibly unlike gasoline. Compared to gasoline, however, methanol is much safer. It is more difficult to ignite and releases less heat when it burns. Methanol fires can be extinguished with plain water, whereas gasoline floats on water and continues to burn. The EPA has estimated that switching fuels from gasoline to methanol would reduce the incidence of fuel related fires by 90%.
- Methanol accidentally released from leaking underground fuel storage tanks may undergo relatively rapid groundwater transport and contaminate well water, although this risk has not been thoroughly studied. The history of the fuel additive methyl t-butyl ether (MTBE) as a groundwater contaminant has highlighted the importance of assessing the potential impacts of fuel and fuel additives on multiple environmental media. An accidental release of methanol in the environment would, however, cause much less damage than a comparable gasoline or crude oil spill. Unlike these fuels, methanol, being totally soluble in water, would be rapidly diluted to a concentration low enough for microorganism to start biodegradation. Methanol is in fact used for denitrification in water treatment plant as a nutrient for bacteria.
See also 
- Alcohol fuel
- Carbon neutral fuel
- Dimethyl ether
- Ethanol fuel
- Methanol fuel
- Synthetic fuel
- Vegetable oil economy
- George A. Olah (2005). "Beyond Oil and Gas: The Methanol Economy". Angewandte Chemie International Edition 44 (18): 2636–2639. doi:10.1002/anie.200462121. PMID 15800867.
- George A. Olah (2003). "The Methanol Economy". Chemical Engineering News 81 (38): 5. doi:10.1021/cen-v081n051.p005.
- George A. Olah, G. K. Suray Prakash, Alain Goeppert (2009). "Chemical Recycling of Carbon Dioxide to Methanol and Dimethyl Ether: From Greenhouse Gas to Renewable, Environmentally Carbon Neutral Fuels and Synthetic Hydrocarbons". Journal of Organic Chemistry 74 (2): 487–498. doi:10.1021/jo801260f. PMID 19063591.
- Beyond Oil and Gas: The Methanol Economy , George A. Olah, Alain Goeppert, G. K. Surya Prakash, Wiley-VCH, 2006
- Product Focus: Methanol, Chemical Week May 23, 2007, Page 29
- "First Commercial Plant". Carbon Recycling International. Retrieved 11 July 2012.
- Source: WPI-080905 (Westerink Procédé Industriel)
- Table of energy densities by weight and by volume for various energy sources
- Methanol's Allure, Kemsley, J., Chemical & Engineering News, December 3, 2007, pages 55-59 
- Energy Density of Methanol (Wood Alcohol)
- Methanol is a developmental and neurological toxin, though typical dietary and occupational levels of exposure are not likely to induce significant health effects. The a National Toxicology Program panel recently concluded that blood concentrations below approx. 10 mg/L there is minimal concern for adverse health effects. Other literature summaries are also available (see, for instance, Reproductive Toxicology 18 (2004) 303–390).
- http://www.methanol.org/pdfFrame.cfm?pdf=Methanol_humantox_rev.pdf, Methanol in fuel cell vehicles Human toxicity and risk evaluation (Revised), Statoil, 2001
- http://www.antizol.com/mpoisono.htm,"Methanol poisoning overview",Mechanism of toxicity
- http://www.epa.gov/otaq/consumer/08-fire.pdf, Methanol Fuels and Fire Safety, EPA 400-F-92-010
- http://www.methanol.org/pdf/evaluation.pdf, Evaluation of the fate and transport of methanol in the environment, prepared by Malcolm Pirnie, Inc. for the Methanol Institute, 1999
- A discussion of the Methanol Economy with George Olah Recording of a program broadcast on NPR.
- Methanol Institute
- Recent information about methanol and its uses Greencarcongress.com
- Recent information about DME Greencarcongress.com