Up until now, ammonia has primarily served the fertilizer and chemical industry with limited regards to carbon emissions. The hydrogen within the ammonia molecule is commonly produced using fossil fuels; this process accounts for 1,2 % of the global CO2 emissions. Rather than usi
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Up until now, ammonia has primarily served the fertilizer and chemical industry with limited regards to carbon emissions. The hydrogen within the ammonia molecule is commonly produced using fossil fuels; this process accounts for 1,2 % of the global CO2 emissions. Rather than using fossils fuels, electrolysis with renewable energy could be used to produce “green” carbon-free hydrogen and ammonia. The transition could decarbonize the ammonia industry and reduce carbon emissions drastically. Considering future emission restrictions and emerging new technologies, the techno-economic cost of green ammonia is expected to decrease. Accordingly, the the research question to be answered was: What are the effects of techno-economic induced cost reductions on the potential for green ammonia in the current and future global ammonia market? This report investigates the production and import costs over several global-oriented supply chains using a supply chain model. Rather than predicting the future, the aim is to gain an insight into the future of the global ammonia market. The scope of this thesis considers world scale ammonia production facilities with a capacity of 2200 ton NH3 per day. Due to their potential to become a producer or consumer of green and grey ammonia, the following countries are examined in more detail: Australia, Brazil, Chile, China, India, Japan, Morocco, Mexico, the Netherlands, Norway, Oman, South Korea, Trinidad & Tobago, United Kingdom, United States. The supply chain model distinguishes between the “grey” (with hydrogen from natural gas through SMR) and “green” (with hydrogen from electrolysis on renewable energy) production process. The supply chain model that is used to gain insight into the future global ammonia market models a green ammonia production process. The following components are included in the model: a 1,5 GW electrolyser (78 % efficient, 2020), 100 MW Haber-Bosch reactor, 57 MW air separation unit, and a 94 MW fuel cell (60 % efficient) for a location that has 5000 FLH. The modelled production plant is sized according to the full load hours in a given country and implemented electrolyser efficiency according following a learning curve (75 % in 2020 to more than 82 % from 2030. In future research, it would be more exact to optimize the production plant’s exact sizing using the available resources at one specific location. Results show that up until 2030 importing grey ammonia is cheaper than domestically producing green ammonia. In addition, due to the sensitivity of the ammonia industry to carbon leakage, a strong CO2 policy is essential to the transition. The main cost drivers for green ammonia are the hydrogen buffer and firm up power of the Haber-Bosch reactor and air separation unit; both are directly related to the cost of the renewable energy, which in turn is strongly dependent on the weather conditions. Currently, Morocco, Chile and China are considering the domestic production of green energy as it is expected to become cost-competitive with domestic grey production of ammonia by 2020. The analyses show that in addition to these countries, Australia, the United States of America and Oman show optimal conditions for domestic production of green ammonia as well.