Green ammonia gaining prominence with environmental policies pushing for a circular economy
By Amit Rawat, Senior Research Analyst, TechVision Practice, Frost & Sullivan
A rapid shift toward renewable energy utilization for producing green hydrogen for ammonia synthesis can pave the way for industries to reduce carbon emissions, meet sustainability goals, and move toward carbon neutrality. Green ammonia offers promising application prospects in the development of clean chemicals and intermediates for safe agricultural products, high-quality marine fuels, and industrial products. Most of the ammonia produced today is based on THE Haber-Bosch process requiring hydrogen and nitrogen as feedstock. The key ingredient, hydrogen, is typically produced using coal gasification and steam reforming of natural gas. Both are energy-intensive methods that lead to massive greenhouse gas emissions and global warming. Conventional ammonia, or brown ammonia production, emits about two tons of carbon dioxide (CO2) across the value chain, whereas green ammonia produced from renewable sources does not emit CO2. As a result, the focus of stakeholders is on the decarbonization of ammonia production using low emission technologies.
The adoption of green ammonia will significantly increase as the environmental policies targeting CO2 emission reductions continue to gain momentum across the globe. With the declining costs of clean energy technologies and growing emphasis on circularity, the companies and policy makers are increasingly focusing on developing hydrogen economy and related infrastructure. For instance, the European Union’s Hydrogen Strategy promotes the development of new low-carbon technologies in line with the region’s clean energy transition and carbon neutrality. The strategy aims to increase domestic production of clean hydrogen that can be used as a valuable raw material for green ammonia.
Middle East governments and private companies continue to invest in joint venture projects to develop the region’s renewable energy sector and increase the use of clean energy for green ammonia production. In 2021, the governments of Israel and Jordan signed one of the largest cooperative agreements, brokered by the UAE, in the Middle East. The agreement will allow Israel to purchase renewable electricity from a solar power plant in Jordan, and Jordan will be able to purchase water from a desalination plant in Israel. The agreement will enable Israel to meet its target of reaching 30% renewable energy utilization by 2030 and also solve the severe water shortage in Jordan. The establishment of cross-country renewable energy trading infrastructure will also prove beneficial to hydrogen and ammonia producers who will have access to low-cost clean energy.
In addition to the Middle East, North Africa is also emerging as a key center for establishment of export oriented green hydrogen and ammonia hubs. Fertiglobe, the result of a strategic partnership between the Abu Dhabi National Oil Company (ADNOC) and OCI, will establish a 100 MW polymer electrolyte membrane (PEM) electrolyzer-based plant at Egypt Basic Industries Corporation (EBIC) in Ain Sokhna, Egypt. Once commissioned, the plant will be the world’s largest independently owned green hydrogen production facility and utilize produced hydrogen as feedstock for synthesizing 90,000 tons of ammonia
Due to the high hydrogen content of ammonia, it can be used as a zero-carbon fuel alternative. Liquid ammonia, which has a higher energy density than liquid hydrogen, is easier to store and transport. Additionally, the thermal properties of ammonia such as boiling temperature and condensing pressure are comparable to propane, making it a viable fuel option. As ammonia is a weak base, it can be easily balanced with weak acids such as acetic and citric acids. Ammonia has a calorific value lower than other fuels, making it less likely to ignite if accidentally released, making it a safer option. In recent years, new fuel cell technologies such as protonic ceramic fuel cells, PEM fuel cells, and energy-efficient molten carbonate fuel cells are gaining attention from industry players for the valorization of green ammonia as a fuel for marine applications.
Due to the presence of nitrogen, ammonia also has a significant application as a fertilizer in the agriculture sector. Green ammonia can be transformed into different fertilizers by treating it with different acids at different temperatures and pressures. Urea is the most commonly used fertilizer due to its high nitrogen content compared to other fertilizers. Utilization of green ammonia offers significant decarbonization opportunities to refineries and fertilizers plants enabling sustainable agriculture.
Stakeholders in the ammonia production and renewables sector are forming strategic partnerships to invest in infrastructure to produce green ammonia using renewable energy and scale up production. For example, Norwegian Aker Clean Hydrogen, an integrated ammonia, hydrogen, and methanol producer, is working with renewable energy developer Statkraft to produce green ammonia and bring related technology to the Indian and Brazilian markets to meet the demand from the steel and fertilizer industries. Companies can take advantage of favorable government measures in line with climate goals and increase domestic production of green hydrogen and ammonia. For example, the Indian government recently announced a hydrogen policy to help green hydrogen/ammonia companies build renewable energy capacity on their own or with the assistance of other technology developers who are experts in the field.
The use of green ammonia in the production of agrochemicals and industrial chemicals is expected to increase; however, the current production scale cannot meet the demand. As a result, companies in the chemical manufacturing space are likely to adopt a hybrid model that includes fossil fuel-based ammonia and renewable energy-based ammonia to comply with government policies in the short term. Ammonia producers are working with renewable energy developers and research universities to develop small-scale renewable energy power plants and related technologies. The companies are also actively seeking public and private funding to produce green ammonia and scale up production. For example, Hive Hydrogen and African Oxygen Ltd.’s Green Ammonia Project, based on renewable solar energy, is targeting production of 156 KT by 2025. The companies will establish a new green ammonia plant in Nelson Mandela Bay, South Africa. Hive is backing all the growth plans and is seeking funding opportunities with the assistance of project partners. The renewable power supply will be procured from the Coega Special Economic Zone.
As the focus shifts to expanding green ammonia production and reducing reliance on imports over the next four to five years, the need for additional on-site storage and transportation infrastructure will increase. As green ammonia production increases and it becomes available as a marine fuel in the international market, shipping companies can work together to develop new infrastructure. For instance, Japan’s ITOCHU signed a MOU (memorandum of understanding) with South African chemical and energy company Sasol in September 2022 to jointly develop a green ammonia market and supply chain with focus on its utilization of green ammonia as a marine bunker fuel.
With the advent of hydrogen economy, green ammonia with its wide application potential, criticality to several sectors and potential to decarbonize hard to abate industries is emerging as a key hydrogen carrier and storage solution. However, significant challenges remain in the widescale adoption of green ammonia, especially as a fuel. For instance, while green ammonia is carbon neutral, its combustion results in the emission of nitrogen oxides (N2O). N2O has approximately 298 times global warming potential compared to CO2 while NOX can cause ozone formation at ground level resulting in respiratory issues. On the production side, there are several challenges such as cost and efficiency of electrolyzer for hydrogen production and loss of useful energy during ammonia synthesis by the Haber-Bosch process. Governments and industry participants must focus on the overall value chain to minimize energy losses and pollution potential to make green ammonia a viable solution for decarbonization. To meet the high demand and achieve sustainability goals, ammonia manufacturers will increase their R&D investment and focus on improving catalysts and ammonia separation methods (at low temperature and pressure), reducing energy consumption, and increasing production efficiency in the green Haber-Bosch or decarbonized Haber-Bosch process.