KGAL invests in Arcadia’s green hydrogen-based fuel plant
KGAL, the independent investment and asset manager, announced yesterday that following its first close, the new Article 9 impact fund KGAL ESPF 6 has invested in Arcadia eFuels’ hydrogen-based production facility in Vordingborg, Denmark.
From mid-2026, the plant is expected to produce approximately 68,000 tonnes of climate-neutral synthetic aviation fuel (eSAF) a year using self-produced green hydrogen. Arcadia eFuels will be producing eSAF on a scale that aligns with the EU’s recent decision to introduce a mandatory quota for sustainable aviation fuel.
“From aviation and logistics to the steel and chemical industries, from water treatment to agriculture – almost anywhere that direct decarbonisation through green power reaches its limits, green hydrogen can be the solution,” said Michael Ebner, Managing Director, KGAL Investment Management. “Given the multitude of possible applications, there is enormous potential”.
KGAL aims to tap this potential for institutional investors with KGAL ESPF 6, an Energy Transition Fund focused on new hydrogen infrastructure projects in the EU-27 and the UK. A further 30 green hydrogen and energy transition projects are in the pipeline – two of which in advanced negotiations.
The production of green hydrogen from renewable energies is currently still more expensive than the environmentally harmful production of grey hydrogen from natural gas. Support mechanisms and the regulatory framework play important roles in developing a hydrogen economy and managing the new KGAL fund. This
While research is being conducted on e-aircraft, the eventual electrification of aviation will still take decades. Green hydrogen, on the other hand, can be produced from renewable energies via electrolysis and then converted into climate-neutral e-kerosene. E-kerosene is one of the Sustainable Aviation Fuels (SAFs) that, according to an EU decision will have to be in the tank of all EU-departing flights in the future.
The blend will have to include at least 2% of SAF as early as 2025, rising to 6% in 2030 and 70% in 2050. Today,the global production of SAF accounts for only 0.15 percent of kerosene consumption. KGAL’s investment in Arcadia eFuels will increase adoption of decarbonised fuel for the aviation industry, as the company builds large scale production facilities to meet the demands of today and for the future. Arcadia eFuel’s Vordingborg facility will be one of the first large scale production facilities devoted to eSAF.
“The demand for eSAF will increase exponentially and we will be among the first to deliver,” comments Thomas Engelmann, Head of Energy Transition, KGAL. “What is more, Arcadia’s management has decades of experience in the refinery and chemical business. Our partners know the market and the technologies down to the last detail”.
The plant’s annual production of 68,000 tonnes could send an Airbus A320 from Munich to London about 15,000 times. Potential customers include fuel suppliers and distributors, as well as airlines and initial agreements have already been made. “Arcadia is fulfilling the promise of creating the world’s future fuels to power the world while protecting the environment,” said Amy Hebert, CEO, Arcadia eFuels.
