Ammonia Energy Live February – 2021

Last week we presented the first episode in our monthly webinar series: Ammonia Energy Live. Every month we’ll explore the wonderful world of ammonia energy and the role it will play in global decarbonisation – with an Australian twist. 

To kick things off we wanted to set the scene for 2021 and give you a sense of where the ammonia transition is at – key projects, key milestones and things to be excited about going forward. And, since this is an Australian-focused series, we wanted to explore what’s important about Australia to the ongoing work of the AEA.

To answer these questions we welcomed AEA Executive Director Trevor Brown. Trevor was interviewed by Andrew Dickson (Asian Renewable Energy Hub/CWP Renewables) and Darren Jarvis (INCITEC Pivot), both founding members of the AEA Australia Committee. 

AD: For those that don’t know you Trevor, can you please tell us a little about yourself and how you came to be associated with ammonia and with the AEA? 

TB: About ten years ago I became very interested in climate change and what I could do. Naturally, I ditched my job as a theatre producer and retrained in finance: that’s how you solve climate change, right?

Fast forward a couple of years and a friend-of-a-friend needed help with a slide deck for an investment pitch, this was an electrochemical ammonia synthesis start-up. I was really interested straight away. This industry sector is responsible for 1% of global GHG emissions and no-one was talking about the potential to decarbonise ammonia synthesis? I thought: other people can focus on wind, solar, and batteries but here is something I can really focus on.

I came across the NH3 Fuel Association and started volunteering for them, helping to run the website and organize the conferences, and joined the Board of Directors in 2012. We re-launched as the Ammonia Energy Association in 2018 as an industry body, as opposed to the mainly academic group we’d been originally, and hired me as Executive Director in 2019.

AD: When did the lightbulb go off in your mind that ammonia can move beyond being a fertiliser & becoming a form of energy?

TB: When I met John Holbrook, the founder of the NH3 Fuel Association. He was the champion of solid-state electrochemical ammonia synthesis, and a real mentor. The ammonia energy movement was put on the map largely through John’s efforts.

I have to admit, I truly spent five or six years trying to step away from this ammonia stuff — but every time I tried to get away, something interesting would happen: it was a snowball effect that made it impossible to step back.

DJ: What do you see as the importance of ammonia to the global Energy Transition?

TB: This is all about climate change – we’re trying to eliminate emissions. First, you electrify everything you can. After that you realise there’s a whole lot of things you can’t easily electrify, like steel or container ships. Molecules are needed to power these things.

The very first molecule you make is hydrogen, and you use it directly and immediately if you can. Lovely molecule. But if the application you have isn’t local or immediate, if it requires long-distance transport or long-term storage, then hydrogen has lots of limitations. At that point you’re going to make your hydrogen molecule into a slightly more complex. Ammonia is one of the prominent alternatives, and it has the tremendous advantage that it doesn’t contain carbon.

With ammonia you end up with a stable, transportable renewable energy commodity you can trade globally – that’s a future for energy markets that hasn’t existed before. If you want a hydrogen fueling station then build it. If you want a network of 20,000 hydrogen fueling stations, build it with ammonia.

AD: Can you paint the picture of the key developments you’ve observed in the last 10 years, the inflection points, for ammonia energy?

TB: The single most important thing has to be the Japanese SIP Energy Carrier project. If you’re going to run your society on hydrogen, where does all the energy come from? They were looking at liquefied hydrogen, LOHC and ammonia as three options for energy imports. The conclusion? Ammonia was the cheapest way to import huge volumes of hydrogen energy. They then realised that if you didn’t have to crack the ammonia back to hydrogen, if you could use the ammonia as a fuel directly, you’d have an even more advantageous energy import system.

There’s been others, like:

That last one was pretty seismic. The IMO said they needed a carbon-free fuel molecule (and a lot of it) to which the AEA raised its hand and said: “Hey, we’ve got some ideas you can borrow!”

AD: What are the applications that are a great fit for ammonia energy?

TB: There is a difference between great fits and realistic business cases going forward, so I’ll talk about the realistic business cases.

Ironically the first one isn’t a great or logical “fit”, but it’s a realistic business case: Japan’s plan to co-fire ammonia in coal-fired power stations. From a strictly climate perspective you think “really?”, but it’s more complicated than that. If you have a 1GW coal-fired power station with a long economic lifetime ahead of it and you can start co-firing it with 20% ammonia next year to achieve instant emissions reductions, that’s a good result. There’s a tremendous amount of momentum behind this idea thanks to Japanese efforts.

Any future net-zero grid is going to need peaker plants, and we now have grid operators looking at feeding gas turbines with ammonia fuel blends (current front runner is 70%-30% ammonia-hydrogen blend obtained from cracking pure ammonia). Stationary power (diesel genset) is another big potential market, with alkaline fuel cell producers currently looking at opportunities in remote and backup power generation.

And obviously, fertilisers. We have a 180Mt global market that needs to decarbonise on the trajectory of the Paris Agreement. We have thirty years to go from 100% to 0% emissions, and we’re just on the starting blocks.

Lots of big, realistic opportunities.

DJ: Good segue with fertiliser here: the key challenge for developing ammonia energy projects is offtake and willingness to pay (as I’m sure our audience agrees). What is your assessment of the business case for ammonia for energy?

TB: The key thing the business case requires is something we don’t have yet: certification. We need a way to demonstrate that the ammonia product we’ve got has a certain carbon intensity. This gives producers, consumers, and supply chain partners confidence. It also allows you to demonstrate a premium for low carbon ammonia.

DJ: In terms of demand for those premiums, where are they showing today? What sort of end-uses and niche markets do we see that actually have market premiums available? 

TB: The maritime sector is going to have to do some price identification pretty quickly. We’re going to see the first significantly-sized ammonia vessels on the water by 2024-5. The Viking Energy vessel from Eidesvik, Equinor and Yara (2MW fuel cell, 5,000 tonne per year ammonia consumption) is fairly small, but Grieg/Wartsila’s new announcement for a bigger ammonia-powered carrier with the same delivery date increases demand. As more vessel projects get announced we’re going to see that consumption demand increase pretty quickly. 

In Japan power generation terms, a 1GW coal-fired power plant co-firing 20% ammonia will consume 500,000 tonnes of ammonia per year. Japan is planning to have one of these operational in 2024-5. They expect to have six operational by 2030 – that’s 3 million tonnes of low carbon ammonia into that market by 2030. They’re big numbers.

NEOM in Saudi Arabia is another one: Air Products has the off-take contract to deliver 1.2 million tonnes of low-carbon ammonia per year into hydrogen markets, where it’ll be cracked back into high-purity hydrogen for PEM fuel cell applications in trucks and buses.

So the demand for a premium, low or zero-carbon ammonia product is clearly going to be in the millions of tonnes, and – crucially – supply won’t be a problem. 

AD: We’ve already touched on certification, but what are the key other things that are needed to unlock the potential of ammonia?

TB: We’re just about to enter a phase where the key technological developments aren’t just on paper, they’ll be demonstrated in real life: 

  • two-stroke (MAN ES) & four-stroke (Wartsila) ammonia-powered marine engines. You’ll be able to go and see with your own eyes ships that run on them. Come back in three years and they’ll be on the sea. 
  • GWs of coal co-firing will be operational within a few years. 
  • large scale gas turbines are a little further away from commercialisation but on the right track.

High purity cracking still needs to be demonstrated at scale, but CSIRO, Fortescue and Hyundai are charging ahead with that one in Australia. And, within a few years we’ll see ammonia-powered fuel cells demonstrated at scale.

On the non-technology side of things certification is obviously critical, but safety considerations are another key item. It’s a matter of taking existing standards from the agricultural, refrigeration, and chemical sectors (amongst others) and reworking them for energy applications – that work is already underway, for the maritime sector, power sector, and others.

DJ: There is a great focus on ammonia for energy globally, yet the AEA has chosen to make Australia the home for its first regional office – why is that?

TB: About a third of our members are either Australian-based or are very active in the Australian market. Australia also has a great business case: there’s a lot of high quality renewable energy resources.

Australia has this long-standing culture of being an energy exporter. But, what does it mean to be an energy exporter in a Paris-aligned world? Ammonia provides the pathway for that. Australia’s a tremendously vibrant place for project development, so it’s a natural fit for ammonia energy and the AEA.

AD: So how can the AEA contribute to the development of the ammonia energy industry, particularly here in Australia?

TB: There are specific projects we’re working on, like certification, but more generally we create connections across regions and sectors to accelerate the process. Demystifying ammonia for those unfamiliar with it and bridging the gaps in knowledge is key. Put all these contributions together and ultimately you’re making it easier for first movers to take risks. We need to work together to reduce and eliminate emissions, so let’s make it easier for more people to move in the right direction.

Register here to view a recording of the event. Ammonia Energy Live will be presented on the last Thursday of every month, 2PM AEDT.

Details are still to be confirmed for our March event, but it will feature Yara and their plans to produce green ammonia at their Western Australian plant, as well exploring recent maritime fuel announcements. Register here – even if you can’t make the event live, we’ll send you a link to watch the recording shortly after the event finishes.

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