Porsche announced last week a deal with Siemens Energy to develop a carbon neutral biofuel. The construction of its first pilot plant for this endeavor is under way in Chile.

The concept is to generate green hydrogen to turn it into biofuel. Porsche chose Chile as the location for its first windmills and pilot plant.

The windmills will provide electricity used to turn water into hydrogen fuel and oxygen. This 100% clean hydrogen will in turn be transformed into methanol to create a biofuel with no greenhouse emissions.

This biofuel could be used first to power Porsche’s racing cars, but by 2026, Siemens Energy envisions producing 550 million liters of this new 100% green biogas.

Fellow German carmaker Audi has been working on such questions for several years.