Green Ammonia – the needed solution to combat climate change?
Russia’s attack war against Ukraine has spurred developments in the European energy mix that took most of us by surprise. Therefore, the need to move forward with the plans for a green hydrogen-based economy is now more crucial than ever. Green ammonia is among the best solutions for a speedy transition to the carbon-neutral Europe. It is economically feasible and its combustion contributes directly to carbon-neutrality targets. The most promising future destinations for ammonia include its use as marine fuel.
It is touted as the solution to cutting emissions from shipping. It is said to be one of the only scalable fuels able to achieve the reduction targets of the Paris Agreement. It is set to be built on a multiple hundred megawatt scale in Oman, Australia, Portugal and India. It is not hydrogen – but it could well be.
At the face of it, ammonia is a relatively strange alternative for climate-friendly technology. In the European Union, 35 metric megatons of GHG emissions stem from the fertilizer industry, where the production of ammonia accounts for the vast majority, approximately 30 Mt. Most of these emissions are due to the production of gray hydrogen through Steam Methane Reformation (SMR), which is an essential part of the Haber-Bosch process, the foremost method of ammonia production globally.
The global average emission factor for ammonia production is around 2,6 tons of CO2 per ton NH3 making it one of the more emission-intensive chemical production processes today. Since approximately 1,8 percent or 500 million metric tons of the world’s total CO2 emissions are caused by ammonia production, the reductions attained through greening the process are not insignificant. They might be a central way to make large parts of the world economy carbon neutral.
From gray to green ammonia
The easiest way to make ammonia green is to plug the conventional technology for its production, the Haber-Bosch process, into a source of green hydrogen, which cuts away the GHG emissions from its production process completely. As the production process for the hydrogen determines the environmental friendliness of the ammonia production process, the color spectrum used to denote potential technologies is the same: gray, blue, turquoise, yellow, pink and green.
Blue and turquoise hydrogen production are carbon-neutral applications of the Haber-Bosch reaction, particularly the SMR process, by which the hydrogen needed for ammonia synthesis is separated from natural gas and the carbon is reacted with oxygen to form carbon dioxide. Yellow, pink and green hydrogen, on the other hand, rely on electrolysis to produce hydrogen with the help of an electrified membrane. While yellow hydrogen is made with electricity from the grid and pink hydrogen is made with the help of nuclear energy, green hydrogen is produced with renewable energy, making it emission-free.
The most promising future destinations for ammonia include its use as marine fuel, which would allow for significant and rapid emission reductions in a field of strategic importance and high emission-intensity.
Ammonia is used widely in industrial applications around the world
Ammonia is used for a number of important applications world-wide, although perhaps none so important than the production of fertilizers. Ammonia, nitric acid, phosphorus, calcium nitrate and potassium are among the most important additive sources of plant nutrition today, forming an array that has allowed for gains in agricultural yields supporting human culture and society as we know it. Beyond them, ammonia has a variety of other important uses in applications such as a refrigerant, a key ingredient in many plastics and dyes, as well as in NOx emission control through the SCR process.
The most promising future destinations for ammonia include its use as marine fuel, which would allow for significant and rapid emission reductions in yet another field of strategic importance and high emission-intensity, since marine shipping today accounts for 3 percent of the world’s GHG emissions. Although much remains to be done, ships and engines are being both retrofitted and redesigned globally to contend with the 2018 pledge of the IMO and the shipping community to reduce shipping GHG emissions by 50 percent by 2050.
Solutions planned to be implemented before mid-2020’s include both fully ammonia-powered engines and LNG engines retrofitted for ammonia use, which will grow the demand for ammonia in a global market further. One example is the concept developed by Elomatic (ARLFV), which allows the LNG-fueled vessel to be converted to ammonia-powered at a minimum cost once green ammonia is available.
Market analysts have predicted that the value of the ammonia market is set to grow from nigh on USD 72 billion in 2021 to over 110 billion by 2028, spurred particularly by population growth in East Asia. In the future, green ammonia may be used even more broadly.
World population with and without synthetic nitrogen fertilizers
Green ammonia allows a rapid transition into a hydrogen economy
Green ammonia has, at least in the short and medium run, benefits that make it a good companion to hydrogen. Perhaps the most obvious of these is its economic feasibility. While the winnings from emission cutbacks accrue from transforming the hydrogen production process, hydrogen itself is notoriously difficult to store for long periods. As the world’s smallest molecule, it permeates tanks and pipelines at the rapid rate of approximately 1 percent/day. These features in the composition of the hydrogen molecule make it necessary for produced hydrogen to have a carrier in order to be feasible for global supply chains. Today, the most central suggestions for these carriers are synthetic methane and liquid fuels, produced from captured carbon dioxide, and green ammonia.
The benefits of green ammonia vis-à-vis its competitors are, on the one hand, its relatively quick ability to reach price parity with gray ammonia and, on the other hand, its lack of carbon. The price of ammonia is strongly tied to the availability of affordable natural gas, which has been subject to a volley of shocks since 2020, including two prolonged winters, one destructive hurricane season, high competition for LNG in Asia and sub-par electricity generation from hydropower in Europe and the US – in addition to the uncertainties posed by the global pandemic. A volatile and high market price and a steadily tightening regulation against the use of methane as an alternative to other fossil fuels are, at least presently, allowing green ammonia to bridge the gap to its fossil alternative sooner.
Perhaps more importantly, however, ammonia is a wholly carbon-free alternative for both a fuel and a hydrogen carrier, which allows its combustion to contribute directly to carbon-neutrality targets that fix many of the parameters of business today and will continue to do so in the foreseeable future. It is perhaps no wonder that many of the largest green hydrogen projects on a global scale already include capacities for ammonia conversion, such as the 600 MW project by Meridian Energy in New Zealand, Yara’s multiple projects in Norway and the H2 Magallanes project in southern Chile.
Due to both the price and the scarcity of natural gas, global interest in green ammonia abounds and attracts cooperation between companies in the European Union.
The Nordics have a lot to offer to green ammonia production
Although Finland has not published a separate hydrogen strategy, opting instead to include hydrogen as a part of its overall energy strategy, there are many advantages to basing hydrogen and ammonia production domestically. Some of these are obvious, such as the highly competitive price of electricity, the strong electricity infrastructure, and the ambitious goals for wind power production capacity, which will chase 5000 MW by the end of 2022, and 10 000 MW by 2025. Others are more idiosyncratic, such as the option to recover waste heat from the electrolysis process to be injected into Finland’s sprawling district heating networks or the ready availability of clean water.
The capacity of Finland, and of other northern European states, to drastically reduce the emissions and consequently the economic risks of ammonia production also has impacts on the security of supply in Europe. Hydrogen and ammonia production in the European states has relied strongly on the availability of Russian natural gas, which has long been an energy security issue and has, since February 2022, become the sign of an era of world politics headed steadily for obsolescence. The European Union and its member states must now restructure their ammonia demand to contend either with a hopefully less volatile supply of methane from China, India or the US – or they must concentrate on new, domestic production that is better shielded from international crises altogether.
Global interest has arisen
Due to both the price and the scarcity of natural gas, global interest in green ammonia abounds and attracts cooperation between companies in the European Union, as well. A number of significant investments are being planned in combining hydrogen and ammonia production, such as the ACE Terminal project, whose plans were recently announced for Rotterdam port by a Dutch consortium.
The terminal will be central to the port’s efforts to offer a large-scale hydrogen network at Maasvlakte, including green and blue hydrogen and ammonia availability from companies such as Uniper, Horisont Energi and Chariot – tying together projects on two continents at the center of Europe. Concentrating the trading of ammonia in Europe at Rotterdam will be a clear step in the direction of establishing open markets.
The window for joining in this development is wide open for Finland and for the other Nordic states, and it will likely allow us to transition to a carbon-neutral economy sooner than other synthetic fuels will. Boosting the creation of a hydrogen-based economy through ammonia comes recommended not only by its financial benefits, but also by the very real concerns over the security of supply exacerbated by the war in Ukraine.
Smelly old ammonia may be a strange recruit in the fight against global climate catastrophe, but it is a readily available one – and we could stand to win some time.