Low carbon
intensity ammonia
What is low carbon intensity (LCI) ammonia?
Low carbon intensity (LCI) ammonia refers to a production process for ammonia that has lower carbon emissions than the current conventional route. Ammonia is produced by combining hydrogen and nitrogen using the Haber-Bosch process. Historically, hydrogen production was produced via the carbon intensive route of Steam Methane Reforming. In Low Carbon Intensity (LCI) Ammonia this hydrogen is produced via electrolysis powered by renewable energy sources such as wind, solar or thermal or by implementing carbon capture technologies (CCS).
How can etasca help?
The etasca team has extensive commercial and technical experience across the ammonia value chain – covering all major production routes as well as end-markets.
Interested? contactus@etasca.com
%
expected demand
growth by 2050
<1%
Low carbon intensity ammonia
as a percentage of current
ammonia production
Commercial considerations:
Demand for ammonia is projected to triple by 2050(1) supported by ammonia’s significant potential for new applications – including as an energy carrier or maritime fuel.
- By 2050 – ammonia could represent up to 25% of maritime fuel – supported by International Maritime Organisation emission requirements and investments being made by marine engine producers for cargo ships.
Ammonia is a far more efficient carrier of energy over long distances than hydrogen.
- The liquefaction of hydrogen for transport requires approximately 35% of the energy contained in the hydrogen itself.
Currently around 1% of global ammonia production is “blue” ammonia, e.g., CO2 by-product has been captured and stored.
End-markets typically do not accept higher pricing for low carbon intensity ammonia.
- Therefore, without government support – the higher production cost of blue/green ammonia could erode producer margins.
Technical considerations:
Approximately 98% of ammonia value chain carbon emissions stem from the hydrogen production, which currently is heavily reliant on fossil fuels.
The cost of production premium for low carbon intensity ammonia can vary from 40% to more than 120%(2) depending on the production route, e.g., blue vs green ammonia etc and geography.
- CCS could increase the cost of fossil-based ammonia production by $50 per ton to $100 per ton– with even higher costs for ammonia produced via electrolysis.(2)
Producing green ammonia from electrolysis (or “renewable” ammonia) requires substantial amounts of energy and a step change in electrolyzer capacity.
- In 2021, total electrolyser capacity worldwide was roughly 500 megawatts. Producing renewable ammonia at the scale needed to achieve net- zero would require more than 2000 times the current capacity.
1. WEF: Ammonia Industry Net-zero Tracker (2023)
2. The International Renewable Energy Agency (IRENA)