【世界銀行】使用清潔氫氣對氨和氮肥進行脫碳處理-2025.2

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FEBRUARY20252025/140

ENERGY&EXTRACTIVESGLOBALPRACTICE

AKNOWLEDGENOTESERIESFORTHE

Public

DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

Thebottomline.Syntheticfertilizersareessentialtosustainingtheworld’spopulation,buttheirproductionisresponsiblefor1.8–2.4percentofglobalgreenhousegasemissions.Cleanhydrogenholdsgrowingpotential(amidfallingcosts)todecarbonizefertilizerproduction.Hydrogenisusedtoproducesyntheticammonia,abuildingblockofmostfertilizers.Withthefertilizermarketas

areliableofftaker,thisshiftcouldsupporttheexpansionofcleanhydrogenoverallevenasitboostsglobalfoodsecurity.Butthistransitionmayrequireadjustments,includingchangesin

AuthorshipPublicDisclosurePublicDisclosureAuthorized

fertilizertypes,andmodificationstoexistingsubsidyschemes.

Theproductionoffertilizeringredientssuchasurea,ammo-niumnitrates,andammoniumphosphatesrequiresammo-nia,over85percentofwhoseproductionisspecificallyforfertilizers.Fertilizerproductioncanthusbemadegreenerbydecarbonizingammoniasynthesisusingcleanhydrogen.

Cleanhydrogencanbegeneratedusingrenewablepowerorproducedfromso-calledlow-carbonhydrogen,whichitselfisproducedfromfossilfuelscombinedwithcarboncaptureandstorage(CCS).Beyondshrinkingthecarbonfootprintoffertilizerproduction,cleanhydrogencandriveinnovationandeconomicgrowth,createmarketopportunities,andmaketheagriculturalsupplychainmoreresilient.

Renewablehydrogenisproducedusingrenewableelec-tricitysourceslikesolarandwind(seeexamplesinfigure1).Thishydrogenisthencombinedwithnitrogen,obtainedfromanelectricallypoweredairseparationprocess,tosyn-thesizeammoniausingtheHaber-Boschprocess.AmmoniaproductioninmostHaber-BoschplantsreleasessignificantGHGemissionssincenaturalgasisusedasafeedstockto

Whatisthebestwaytodecarbonizefertilizerproduction?

Byreplacingfossilfuelswithcleansourcesofhydrogeninthesynthesisofammonia

Thefertilizerindustryplaysacrucialroleinglobalagriculture,ensuringfoodsecurityforbillionsbyenhancingcropyieldsandsoilfertility.However,traditionalfertilizerproductionisenergy-intensiveandreliesonfossilfuels,particularlynaturalgas,leadingtosubstantialgreenhousegasemissions.Byreplacingfossilfuelswithcleanhydrogensources,thecar-bonintensityoffertilizerproductioncanbereduced,therebyadvancingglobalclimatechangegoals,suchasthosesetbytheParisAgreement,aimingtolimitglobalwarmingtowellbelow2°C.

ThisLiveWirewaspreparedbytheEnergySector

ManagementAssistanceProgramattheWorldBankin

supportoftheHydrogenforDevelopmentPartnership.H4Dconsistsofnearly50partnerorganizationsaroundthe

world.Itassistscountriesthathaveincludedlow-emissionshydrogenintheirlong-termdecarbonizationstrategies.

PreparationoftheLiveWirewascoordinatedbyRafaelBen,anenergyspecialistatESMAP,andDolfGielen,ESMAP’s

hydrogenlead.

2DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

Figure1.Basicconceptsunderlyingrenewableammoniaproduction

Batteries

Hydrogenstorage

Material?owPower?ow

WaterOxygen

SolarPV

Ammonia

Hydrogen

HaberBosch

synthesis

Electrolyzer

Wind

Airseparationunit

AirOxygen

Note:Energystorageandbackuppowerareshowninred.Thesearerequiredintheabsenceofagridconnectionoraccesstoso-calledbaseloadrenewables—consistent,reliableenergysourceslikegeothermalorhydropowerthatprovideacontinuoussupplyofelectricity.PV=photovoltaic.

kindisapromisingsteptowardintegratingammoniasyn-thesiswithvariablerenewableenergysources(Boyles2023;Rouwenhorst2023a).

Renewableammoniaproductionthereforerequires:

√Astablerenewablepowersourcesuchashydro,oracombinationofvariablerenewablesources,suchassolarandwind;

√Aconnectiontoalow-carbonelectricitygrid,althoughthismaynotbepracticalduringperiodsofpeakdemand;

or

producehydrogen.Partsoftheproductionprocessaredrivenwithsteamproducedasaby-productoftheexothermic(heat-releasing)ammoniasynthesisreaction.Butrenewableammoniaplantswillrelyminimallyonfossilfuelsandemitsignificantlylessbecauserenewablehydrogenwillreplacehydrogenderivedfromnaturalgasreforming.Also,renew-ables-basedelectricitywillreplacesteam,eventhoughitwillstillbeproducedintheammoniasynthesisreaction(MacFarlaneetal.2020).

√On-siteenergystorage,fromhydrogenstorageorpipe-

linedeliveryofhydrogen,oracombinationofthetwo.

Theserequirementscoulddriveupcosts,giventhehighcostsofstablerenewablesandhydrogenstorage.Butpartialflex-ibilityisasignificanttechnologicaladvance,thealternativebeingtoprovideafixed,constantflowofhydrogenatveryhighcosts,asinthesteelindustry(Aagaardetal.2023).

AmajorchallengeinrenewableammoniaproductionistheflexibilityoftheHaber-Boschprocesstomatchthevariabil-ityofrenewableenergysources.Ideally,plants’operationwouldbefullydynamic,matchingfluctuationsinresourcevariabilitythroughreal-timeadjustments.Butsuchfullflex-ibilityisgenerallynotfeasibleduetothehightemperaturesandpressuresinvolved.Nevertheless,recentefforts,particu-larlybyDanishresearchersandcompanies,areshowcasingadvancementsinthisarea.Forexample,partialflexibilityallowsplantstooperateatafractionoftheirdesignrate.Thedegreeofflexibilitypossiblevariesdependingontheequipmentdesignandmanufacturer.Aninnovationofthis

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DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

carboncaptureefficiency.Approximatelytwo-thirdsofcarbonemissionscanbecapturedrelativelyeasilyinSMR,buttheremainingthirdismorechallengingandcostlytocapture.Bycontrast,upto99percentofemissionscanbecapturedinATR,whichispotentiallymoreeconomicalandenvironmentallyfriendlyforlow-carbonhydrogenproduc-tion(SalmonandBa?ares-Alcántara2021aand2021b).

ThehighercapturerateinATRisachievablebecausepartialoxidationandsteamreformingareintegrated,and,thus,externalheating,whichproduceslow-concentrationfluegases,asinSMR,isnotneeded.ButATRusesmoreenergythanSMR,eventhoughitofferseaseofcaptureandhasaddedoperationalflexibilitysinceawiderrangeofhydrocar-bonfeedstockscanbeused.TheseadvantagesmakeATRapromisingalternativetoSMRforlow-carbonhydrogenandammoniaproduction.Theprocessoflow-carbonammoniaproductionissummarizedinfigure2.

Uncertaintyaroundequipmentcosts,especiallyfornewtech-nologieslikeelectrolyzers,makesithardtopredictthecostsofrenewableammonia.Currentestimatesare$794–$1,543perton—significantlyhigherthanthecostofgreyammonia,$121–$518perton,dependingonnaturalgasprices(Boyles2023;Aagaardandothers2023).Effortsarebeingmadetoreducecoststhroughgovernmentsubsidiesandimprovedproductiontechnologies,withexpectationsofasignificantcostdeclineby2050(Fasihiandothers2020),supportedbythefallingcostsofrenewablehydrogen.Movingtowardrenewableammoniacanpreventassetsfrombecomingstranded;itisalsoausefuloptionforshort-termemissionreductionsandfordevelopingoperatorskillsandpractices.

Forlow-carbonammonia,hydrogenisstillproducedmostcommonlyfromnaturalgasviasteammethanereforming(SMR)withCCS.However,aneweralternativeprocess,auto-thermalreforming(ATR),couldmakelow-carbonhydrogen,andthuslow-carbonammonia,lesscostlybyimproving

Figure2.Low-carbonammoniaproductionusingautothermalreforming

Air

separation

unit

Note:Dependingonthelevelofheatintegration,thepreheatermaynotberequired.CO2=carbondioxide.

CO2

transport

compression

andstorage

Autothermal reformerandwater gasshift

Ammonia

HaberBosch

Hydrogenseparation

Preheater

Hydrogen

Material?ow

Power?owHeat?ow

CO2airmixture

CO2

Naturalgas

synthesis

Nitrogen

Oxygen

AirPower

4

DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

ATRpartiallyoxidizesthenaturalgasfeed.Thispartialoxi-dationmeansthattheheatrequirementfornaturalgascrackingismostlydeliveredinsidethereactor,andonlyasmallamountofnaturalgascombustionisrequiredoutsideittoproducelow-carbonhydrogen.Deliveringheatinsidethereactorinacontrolledenvironmentensuresthatthewastestreamisnearlypurecarbondioxide(CO2),whichthenbecomeseasier(andcheaper)tosequesterbecausenoseparationisneeded.Forammoniaproduction,integratingheatwiththeenergyproducedbytheHaber-Boschsynthe-sisreactorcouldfurtherreduceoreveneliminatethenaturalgascombustionrequiredbythepreheater(whichproducesCO2thatisconsiderablymoredifficulttosequester).

ThecaptureofconcentratedCO2streamsisalreadyquitecommonintheammoniaindustry,regardlessofthehydro-genproductionprocess,SMRorATR.Butthiscannotbeconsideredacarbonabatementapproach,sincethecarbonreactswithammoniatoproduceureaforagriculturaluse,andthecarbonintheureawillbequicklyreleasedintotheatmosphere.1

“High-qualityrenewableenergyenables

lower-costammoniaproductionbyloweringelectricitycosts.”

Becauseusingureaemitscarbon,agriculturewillneedhelpswitchingfromurea,whichissimpletoapply,becauseitissolid,tootherlow-orno-carbonfertilizersthatcanbepro-ducedfromammoniaalone,oftenintheformofammoniumnitrate,orwithotherinputs,suchasammoniumphosphatesorcalciumammoniumnitrates.Someofthesefertilizers

1Trueabatementwouldrequirethecapturedcarbontobestoredeither

geologicallyorinamineraldepositwhereitcannotentertheatmosphericcarboncycleintheshortterm.Alternatively,thecarbonforureacouldbe

extractedfromtheatmosphereorfrombiomass(agriculturalresidues,for-estryby-products,dedicatedenergy,organicwastematerials),butthecostsofextractingitfromtheatmospherearemuchtoohigh.Directaircaptureandbiomasswithcarboncaptureandstorage,respectively,cost$125–$335and$40–$120pertonofCO2(IEA2020).Moreover,theavailabilityofbio-massismuchtoolowgiventheglobalscaleoffertilizerproduction.

mustbeappliedasaliquid,whichcanbemorecostlyandtime-consumingtouse(Vogl,?hman,andNilsson2018).Thetransitionwillrequireadjustingsubsidyregimestosupportotherformsoffertilizers(Oniandothers2022).

Whatroledosubsidiesplayinfertilizer

markets—andhowisthatlikelytochange?

Subsidiesinteractwithnaturalgaspricesandotherfactorstoshapeprices,supplychains,andchoicesoffertilizers

About200millionmetrictons(MMT)ofammoniaarepro-ducedgloballyperyear,ofwhich170–180MMTgointoagriculturalfertilizers.Theremaining20MMPareusedinvariousindustrialapplications,includingtheproductionofexplosives,plastics,andotherchemicals.Everyyear,about20MMTofammoniaareshippedglobally.Transportingammoniaisfeasibleaswellascost-effective—andimportanttosustainitsglobalsupplychain—giventhesimilarityofitspropertieswithliquifiedpetroleumgas.

Fertilizertypesvarybyregion.DirectapplicationofammoniaiscommonintheUnitedStates,ureaiscommoninIndia,andnitrateispredominantinEurope.Whilerenewablehydrogenwillmaketheproductionofrenewableammoniaaffordableinthemediumtolongterm,producingderivativeslikeurearemainsachallenge.

Asnotedearlier,thepricesofnaturalgas—afeedstockandenergysourceintheHaber-Boschprocess—primarilydrivethecostofammoniaproduction.Thehighnaturalgaspricesduringthewinterof2022/23ledtothetemporaryclosureofseveralEuropeanammoniaproductionfacilities(Unkovichandothers2020)(figure3).Pricevolatilitystronglyinfluencestheeconomicsofammoniaproduction,particularlyforlow-carbonammoniaprojects.Giventhesecostdynamics,themostadvancedlow-carbonammoniaprojectsarecon-centratedinregionswherenaturalgasisaffordable,suchastheGulfCoastoftheUnitedStates.

Thequalityofrenewableenergysourcesheavilyinfluencesthecostofrenewableammonia.High-qualityrenewableenergyenableslower-costammoniaproductionbylow-eringelectricitycosts.Consistentpowerproduction,oftenachievedbycombiningwindandsolarresources,minimizes

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DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

Figure3.Fertilizerpricesovertime,showingaspikecoincidentwithhighnaturalgasprices

$permetricton

800

DAP

Urea

MOP

600

400

200

20162017201820192020202120222023

0

Source:Bloomberg;WorldBank.

Note:LastobservationisDecember2022.

DAP=diammoniumphosphate;MOP=muriateofpotash.

Figure4showsthecoststructurefordifferenttypesoffertiliz-ers,usingIndiaasanexample.Thegreenbarsrepresenttheproductioncostoffertilizers;theyellowbarsrepresenttheestimatedsubsidytomakefertilizersaffordableforfarmers.Conventionalureabenefitsfromheavygovernmentsubsi-dies,whichsignificantlyreduceitscostsforfarmers.Incon-trast,thepredictedcostsforrenewableammoniain2030arehigherthanthelowest-costconventionalurea(butlowerthanthehighmarketpricesobservedduringpricespikesin2022).Thishighlightsthepotentialforrenewableammoniatoprovidepricestabilityandprotectionagainstmarketvol-atility,thoughitwillstillrequiresubsidiestocompetewithconventionalurea.

ThefigurehighlightsthesignificantroleofsubsidiesindeterminingfertilizeraffordabilityinIndia.Whilerenewableammoniawilllikelyrequire$500$1,200insubsidiespermetrictontocompetewithconventionalureain2030,itisprojectedtoofferpricestability.However,widespreadadop-tionofrenewablefertilizersmayneedadditionalincentivesandpolicymeasuressuchassupportforswitchingfromureatoalternativefertilizers.Thesemeasuresarenotconsideredinthecurrentanalysis.

theneedforseasonalenergystorage.Fertilizerproductioncostsarethereforelowestincountrieswithfavorablerenew-ableenergyprofiles,makingthemidealasfertilizerexport-ers.Developingcountrieswithlimitedaccesstofertilizersthushaveasignificantopportunitytonotonlyproduceandconsumefertilizerslocallybutalsoexporttheexcess.Forinstance,fertilizerconsumptioninKenyaisonlyathirdoftheglobalaverageperhectare,butthecountryhasapromisingprofilefortherenewableproductionoffertilizer.RenewableammoniaproductioninKenyaandothersimilareconomiesthereforeoffersopportunitiesforboththedomesticandexportmarkets(Nayak-Lukeandothers2022).

Althoughammoniasprimaryusehashistoricallybeenasfer-tilizer,itsroleislikelytochangeinadecarbonizedeconomy,forexample,asamarinefuel,along-termenergystoragemedium,orahydrogencarrier.Thispotentialforsectorcouplingmaycreatecost-savingefficienciesbutmayalsointroducecompetitionthatcoulddriveuppricesinsomeindustries(Terazono,Pickard,andEvans2022).

Whileswitchingtozero-carbonfertilizerproductionpresentsaviableopportunitytousecleanhydrogen,itishinderedbyalowwillingnesstopayunlessproductionissupportedbycarbontaxationorgovernmentsubsidies.

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DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

Figure4.RoleofsubsidiesindeterminingfertilizercostsinIndia

Cost($pertonofnitrogen)

1,200

1,200

1,000

800

CostofureaSubsidyrange

800

750

600

400

400

250

200

0

0

ConventionalureaRenewablefertilizer(2030)Highmarketpriceurea(2022)

Fertilizertype

Source:NEDO2024.

Note:Thegreenbarsrepresentproductioncostsandtheyellowbarsindicatethesubsidyrangerequiredtobridgethegapbetweenmarketpriceand

subsidizedprice.Costsarenormalizedpermetrictonofnitrogentoenableafaircomparisonacrossdifferentfertilizertypes.Thefigureillustratesthecostofconventionalurea(withsubsidies),predictedcostsforrenewablefertilizersin2030,andthehighmarketpriceofureaobservedduringthe2022pricespikes.

Advancementsinsolarandelectrolysistechnologyareexpectedtolowerthecostofrenewableammonia,makingitaviable,competitiveoptioninagriculturebyreducingfer-tilizercost.However,carefulregulationisnecessarytoavoidexcessiveapplicationandtheassociatedenvironmentalrisks,suchasnitrogenoxidesemissions.Strategicgovern-mentpoliciescanhelpbalanceeconomicgainswithenvi-ronmentalprotection(Mülleretal.2023).

Whatisthestatusofcleanammoniaproduction?

Importantprojectsarealreadyoperational,andmanycasestudiesandpilotprojectshavebegun

Box1highlightsafewofthemostvisiblerenewableandlow-carbonammoniaprojectsinemergingmarketsanddevelopingeconomies.

RenewableammoniaproductionismakingsignificantprogressinIndia.Majorprojectsarespearheadingthegreentransitioninfertilizers.OneoftheflagshipprojectsisafacilitybeingdevelopedbyAMGreeninKakinada,AndhraPradesh,expectedtohaveaproductioncapacityof1MMT

ofrenewableammoniaannuallyandprojectedtobeginoperationsinthesecondhalfof2026.Thefinalinvestmentdecisionfortheproject,whichrepresentsamajormilestoneinIndia’sNationalGreenHydrogenMission,wasreachedinAugust2024.TheprojectwillleveragelocallyavailablerenewableenergysourcestohelpIndiaachievedecarbon-izationandrelylessonfossil-fuelbasedammoniaproduc-tion(NSEnergy2024).Theprojectwillprovidealow-carbonalternativetoconventional,carbon-intensiveammoniapro-ductionmethods.Itsrenewablehydrogenwillbeproducedusing640megawattsofadvancedpressurizedalkalineelectrolyzerscapableofproducinghydrogenfromsolarandwindenergy(suppliedtoAMGreenbyJohnCockerillundertheirpartnership).Thisrenewablehydrogenwillbesynthe-sizedintorenewableammonia,whichthefertilizerindustrycanutilizefurther.Thislarge-scaleprojectunderlinesIndia’scommitmenttosustainableagricultureandpositionsthecountryasaleaderinglobalprogresstowardnetzero(Bailey2024).

Chilehasinitiatedseveralrenewableenergyprojectsthatareadvancingtheproductionofrenewableammoniaforthefertilizerindustry.OneofthemostnotableistheHyEx

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DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

Box1.Selectedrenewableandlow-carbona

Globally,therearemanyrenewableandlow-carbonammuseoftheirproduct,butformany,fertilizersareanofftakeprojects.

TableB1.1Selectedrenewableandlow-carb

mmoniaprojects

oniaprojects.Mosthavenotannouncedtheintendedcase.TableB1.1offerskeystatisticsoffourvisible

onammoniaprojects

tablefor

ale

achedfinalinvestmentdecisiondisunderconstruction

ale

eadyoperational

Approximateammonia

capacity(millionmetric

tonsperyear)

9(Phase2oftheproject)

1

10

0.017

Projectname

Projectowners

No

AustralianRenewableEnergyHub

BP,InterContinentalEnergy,andCWPGlobal

Sc

Neom

AirProducts

Re

an

GreenEnergyOman

IntercontinentalEnergy,OU,EnerTech,Shell

Sc

Fertiberia

Fertiberia

Alr

Note:Foracomprehensivelistofrelevantprojects,seeArgusMedia(

https

:///nh3-2023.html).

Project,acollaborationbetweenEnaexandEngie.ThisprojectutilizessolarpowerfromnorthernChiletoproducerenewablehydrogen,whichisthensynthesizedintorenew-ableammonia.Therenewableammoniawillbeusedtopro-duceammoniumnitrate,avitalcomponentinfertilizersandexplosives,particularlyfortheminingsector(Rouwenhorst2023b).AnothersuchprojectistheHNHProjectintheMagallanesregion,involvingAustriaEnergy,?kowind,andCopenhagenInfrastructurePartners.Thatprojectisdesignedtoproduceapproximately1.35MMTofrenewableammoniaannuallyusing3.5gigawatts(GW)ofwindpowerand3GWofelectrolyzercapacity(CopenhagenInfrastructurePartners2024).Whileprimarilyfocusedonexports,thisrenewableammoniaalsohaspotentialapplicationsindecarbonizingglobalfertilizerproduction.

Morocco’sOCPGroup–ledTarfayaGreenAmmoniaProject,a$7billioninitiativeproducingrenewableammoniatosup-portsustainablefertilizerproduction,wasinthefront-endengineeringdesignphasewithWorleyasofAugust2024.TheprojectwillharnessMorocco’ssolarandwindresources

togenerate1MMTofrenewableammoniaannuallyby2027,withplanstoexpandto3MMTby2032(ESGNews2024).TheTarfayaproject,whichintegratesrenewableenergyintoammoniaproduction,alignswithMorocco’s2040carbonneutralitygoals.ItwillhelpMoroccorelylessonfossilfuelsandprovidealow-carboninputforthefertilizerindustry.

Brazil’sRiodeJaneiro–basedPortofA?uBlueAmmoniaProjectisadvancingtheproductionoflow-carbonammonia,withapplicationsinfertilizers.The$3billioninitiative,devel-opedincollaborationwithToyoEngineering,willusenaturalgaswithCCStoproduceanestimated1MMToflow-carbonammoniaannually,fordomesticuseaswellasforexport.Locatedneargaspipelinesandfertilizerdistributionroutes,theprojectbenefitsfromlogisticalefficiencyandsupportsBrazil’sagriculturalandindustrialsectors.Futureplansincludetransitioningtorenewableammoniaasrenewableenergysourcesbecomemoreviable(H2Bulletin2024).

Nigeria’sBrassFertilizerandPetrochemicalCompanyprojectinBayelsastateisamajorlow-carbonammoniainitiative

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DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

focusedonthefertilizerindustry.This$3.5billionfacility,developedinpartnershipwithShell,TotalEnergies,andEni,willreceive270millioncubicfeetofnaturalgasdailyandintegrateCCStechnologytoloweremissions.Theprojectisexpectedtoproduce1.66MMTofammoniaannually.ItaimstoreduceNigeria’sfertilizerimportsby30percent,savingapproximately$200millioninforeignexchangeeachyear.TheprojecttapsintoNigeria’s200trillioncubicfeetofgasreserves,advancingsustainablefertilizerproductionbyuti-lizingdomesticresourcesandadvancedCCS(Eboh2024).

ThesecasestudiesfromSouthAsia,LatinAmerica,andAfricaillustratethediverseapproachesandsignificantpotentialforrenewableandlow-carbonammoniaproductioninemerg-ingmarketsanddevelopingeconomies.Whilerenewableammoniaprojectsdemonstratethefeasibilityandsustain-abilityofutilizingrenewableresources,low-carbonammo-niaprojectsleverageexistingnaturalgasinfrastructure.

Arepolicyandregulatoryframeworksconducive?

Indevelopingcountries,policiessupportingtheuseofhydrogenandammoniainagriculturearegraduallyevolvingtoaddresstheneedforlow-carbonsolutions

Tofacilitatethetransitiontocleanhydrogen,policychangesmustfocusoncreatinganenablingenvironmentthatsup-portsinvestmentincleantechnologies.Governmentsshouldconsiderimplementingrobustcarbonpricingmechanismstomakerenewablehydrogenmorecompetitiverelativetoconventionalfossilfuels.Clearregulationsandstandardsfortheproductionanduseofcleanhydrogenwillhelpensureconsistencyandbuildinvestors’confidence.

“Tofacilitatethetransitiontoclean

hydrogen,policychangesmustfocuson

creatinganenablingenvironmentthat

supportsinvestmentincleantechnologies.”

India’sNationalHydrogenMission,launchedin2021,targetstheproductionof5MMTofrenewablehydrogenby2030;theaimistodecarbonizefertilizerandotherindustries.Similarly,Brazil’snationalhydrogenstrategyaimstofosteramarketforcleanhydrogenproduction,despiteeconomicconstraints.

Subsidiesandincentiveswillplayacriticalroleinloweringthefinancialbarrierstoadoptingcleanammonia.Today,conventionalfertilizersareheavilysubsidizedinmanycoun-tries.Forexample,India’sbudgetforfertilizersubsidieswas$25.5billionforthefiscalyear2023–24.Atransitiontocleanammoniaandhydrogen-basedfertilizerswillrequiresimilarorhigherlevelsofsubsidies.Thiscouldincludedirectsubsidiesforrenewablehydrogenproduction,taxincentivesforthepurchaseofhydrogenproductionequipment,andgrantsforresearchanddevelopmentprojects.

However,regulatoryhurdlessuchasbureaucraticdelaysandlackofinfrastructurewillhavetobeaddressed.Streamliningregulatoryprocessesanddevelopinginfrastructureforhydro-gendistributionandstoragearecriticalinsupportingthegrowthofacleanhydrogeneconomy.Further,internationalcooperationandfinancialaidfromdonorcountriescanhelpovercomechallenges.

Whatarethenextsteps?

Takeawaysandrecommendationsforgovernmentsandinternationaldonororganizationsmaybegroupedintofivecategories

√Addressthepricegapthroughofftakeagreements.

Thetransitiontocleanhydrogenandfertilizersrequiresmechanismstoaddressthepricedisparitybetweencon-ventionalfertilizersandcleanalternatives.Governmentsanddonororganizationsshouldfacilitatelong-termofftakeagreementsinwhichbuyerscommittopur-chasingcleanfertilizersatapredeterminedprice.Theseagreementsreducethefinancialriskforproducersandsignalmarketstability,therebyencouraginginvestmentincleanproductiontechnologies.

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DecarbonizingAmmoniaandNitrogenFertilizerswithCleanHydrogen

√Considerthecostoffinancingandaccesstocapital.Financingremainsasignificantbarriertotheadoptionofcleanfertilizers.Dedicatedgreenfinanceinstruments,suchaslow-interestloansorgreenbonds,canalleviatetheup-frontcapitalcostsforproducersanddistributors.Internationalfinan