Despite Diesel-gate and the billions in penalties and fines to be paid out by the VW Group, Audi appears to be in a state of denial. But appearances can be deceptive. Or perhaps Audi want to extend the life of the internal combustion engine beyond the era of pure electric powertrains because Audi believes, quite correctly, that electric powered cars cannot match the range of diesel or petrol powered cars.

The answer is to develop synthetic diesel from renewable energy supplies. In theory, Audi says they could develop and manufacture a carbon-neutral diesel. Audi’s idea is radical as Elon Musks view of a pure electric future.

So how does it work? Electrolysis. The fuel is created by combing carbon-dioxide, water and electricity, the whole process is powered by renewable energy.

The end result of this industrial process is the creation of a liquid energy carrier termed “blue crude” similar to crude oil. Just like crude is refined into diesel or petrol, blue crude can be refined into liquid e-diesel.

The current pilot facility is based in Dresden, Germany, and involves high-powered electrolysis to split water into hydrogen and oxygen.

Currently, blue-crude production has a long way to go in order to match crude oil production. Crude oil production generates 96 million barrels of oil and liquid fuels per day.

So how much blue crude does Audi’s test facility generate? It’s just 160 litres of fuel (35 imp gal; 42 US gal) a day.

Eventually, Audi intends to produce 400-00litres of e-diesel per year, it’s still a drop in the ocean when you consider refined crude oil can generate 86,0000-litres of liquid fuel in just one barrel alone.