Abstract The last two decades saw the emergence of a new multi-source, multi-market fuel, Dimethyl Ether or DME. Prior to 1990, DME had only found limited commercial use as an aerosol propellant along with propane and butane as a green replacement for the chlorofluoro-hydrocarbons which were outlawed because of their detrimental impact on the ozone layer. DME is an environmentally benign, non-toxic, biodegradable product with physical properties similar to LPG. Global DME annual production capacity is approximately 10 million metric tons and actual market use is reported to be about 3 million metric tons – a remarkable increase from the 200,000 metric tons market demand in the early 2000s. Nearly all of the DME is produced in China from coal-derived methanol via the well known catalytic dehydration process where two molecules of methanol react to form one molecule of DME and one molecule of water. DME is the fastest-growing methanol derivative, yet is still an emerging business with lots of upside opportunities combined with significant challenges. A number of other DME plants are in different stages of development around the world including Egypt, Middle East and Indonesia, all of them natural gas based. Sweden is the leader in the development of bio-DME produced through the gasification and conversion of black liquor, a byproduct in Sweden's paper and pulp industry. Nearly all of today's DME is used as a blend stock for LPG which in turn is primarily used for cooking and heating. At blending levels below 20 vol %, the existing LPG blending facilities, local distribution infrastructure and end-use equipment can be used with minimal (if any) modifications – making for easy marketing. Currently, efforts are underway to commercialize DME as a high-quality diesel alternative. Technical issues such as new fuel injection systems and new fuel additives have been solved and solutions are currently being tested in fleets. This review will describe the history, status and future of DME as a global fuel alternative and how it has and will be changing the global methanol industry.
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