The views expressed are those of the author and do not necessarily reflect the position of FORESIGHT Climate & Energy
As the world moves away from fossil fuels and adopts cleaner forms of energy, we are more dependent upon intermittent solar and wind power, which can be abundant at times and absent at others. Consequently, there is a need for energy storage solutions to help bridge the gap. While there are electronic, mechanical, kinetic, and other creative methods to store power, chemical storage has the greatest propensity for widespread use.
Research is underway to investigate which synthetic or organic compounds are best suited for storing and releasing power. From these investigations, results show that of the carbon-free substances with the highest volumetric energy density, which can also be synthesised from renewable energy sources, ammonia appears to be one of the best candidates. The high concentration of nitrogen in ambient air raises the feasibility and economy of combining split water with nitrogen to produce ammonia as a carbon-free hydrogen carrier. This form of ammonia could serve as the primary sustainable energy storage medium for the future. This is evidenced by green ammonia pilot projects mushrooming up around the globe.
Ammonia shows promise as a hydrogen carrier thanks to its high hydrogen density (17.65%), the fact that it forms a liquid at a relatively low pressure of 10 bar or temperature of -33°C, and its well-established distribution network. In contrast, storing hydrogen as gas requires high volume while storing hydrogen as liquid at much lower temperatures involves high energy losses. Produced for over 100 years for use as fertiliser, each year some 154 million tonnes of ammonia are produced and distributed by barges, railroad and long-distance pipelines over thousands of kilometers and offer more efficient energy transmission than electricity power lines.
With its relatively higher capital and operating costs than those of traditional ammonia production, even considering long-term efficiency gains and lower levelised cost of energy for renewable energy, green ammonia will struggle to be competitive with industrial ammonia and therefore its commercial adoption going forward will very much be dependent upon incentives, regulations or predetermined pricing schemes. Nevertheless, market analysts indicate that there is real potential for future adoption of green ammonia not only in traditional fertiliser and industrial markets, but increasingly for energy applications alongside a gradual transition from industrial to green ammonia for the shipping industry.
Realistically, the ability to leverage ammonia as a ubiquitous energy storage medium largely depends on the successful development of new catalysts or techniques to displace the commonly used energy-intensive Haber-Bosch ammonia production process. Because the storage, handling and transportation of hydrogen is notoriously challenging, a range of mature and emerging hydrogen carrier and storage technologies are being studied for potential commercial applications. Similarly, while ammonia shows potential as a fuel for transport applications, limitations in proton-exchange membrane (PEM) fuel cell technology continue to prevent its mainstream adoption. Technological advancements in electrolysis and hydrogen fuel cells are expected to improve ammonia’s round-trip energy efficiency ratio, thus increasing its potential to play a primary role in future energy storage.
For a densely populated country with low potential to produce sustainable energy, Japan is looking to ammonia as the best means for importing renewable energy. In an interview with the Financial Times newspaper, Green Ammonia Consortium director Shigeru Muraki indicated that ammonia shipments, replacing coal or natural gas, could lead to changes of the global energy markets. The Consortium envisions a multi-pronged strategy for the production and use of carbon-free ammonia fuel. Taking into account all cost components, transmission and distribution of hydrogen as ammonia is likely the cheapest mechanism for imports to Japan from Australia.
A feasibility study in Japan involving Saudi Arabian oil company Saudi Aramco is intended to result in a demonstration shipment of carbon-free ammonia to Japan. Japanese power firm JERA, a joint venture between TEPCO and Chubu Electric, issued a roadmap to achieve zero carbon emissions by 2050. In the first half of the 2030s, JERA wants to achieve a 20% ammonia co-firing rate at all its coal plants, and it is seeking to shift to 100% ammonia by the 2040s. Japan’s International Resource Strategy explicitly calls for demonstration projects to promote ammonia as a fuel, in alignment with Japan’s declaration to be carbon neutral by 2050.
The green ammonia market was valued at $17 million in 2019 and is projected to reach $852 million by 2030, at a compound annual growth rate (CAGR) of 54.9% over the period. Increasingly, end-users are willing to pay a premium to use carbon-free ammonia in their transportation, power generation and industrial feedstock products instead of traditionally produced ammonia, in order to help reduce greenhouse gas emissions. The power generation segment is expected to grow fastest as electricity generated from green ammonia will gradually replace gas. Surplus renewable energy, where it becomes available, will drive electrolysis plants to produce carbon-free ammonia as a sustainable fuel for power generation.
Furthermore, the need for long term storage of renewable energy generated via solar panels and isolated wind farms will drive the continued growth of the green ammonia market—a sector which, thanks to various government initiatives, Europe is expected to dominate between 2020 and 2030.
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