Energy Transition

Clean Ammonia | Fertilizing a Blue Transition

byAlex Nevokshonoff, Enverus Intelligence® | Research (EIR) Contributor

More than 180 million tonnes of ammonia are consumed worldwide each year, mainly as fertilizer, with only 1% coming from clean sources. In North America, announced clean capacity is set to increase sevenfold by 2030, driven by its potential to economically transport low-carbon hydrogen overseas. However, few projects have reached a final investment decision as developers and investors evaluate the economic viability of different production pathways.

According to a recent report by Enverus Intelligence®Research, hydrogen production accounts for 75-90% of the levelized cost of ammonia (LCOA) for all analyzed cases, highlighting the need for inexpensive hydrogen feedstock (Figure 1). Gray ammonia facilities consuming hydrogen at $1.50/kg have the lowest before-tax LCOA at $438/tonne. However, when taxes and federal incentives are considered, blue ammonia can achieve cost parity with gray production, ranging between $425-$485/tonne. In contrast, subsidized green ammonia produced using ALK or PEM electrolysers costs roughly twice as much as the cheapest blue ammonia pathway, limiting its appeal to foreign markets with decarbonization mandates or demand-side incentives.

Highlights From Energy Transition Research

Seeing the Ceiling | Maximizing for Output of Today’s Gas-Fired GridThis analysis looks at the maximum potential for incremental gas-fired generation from now until 2035, given load growth projections from data centers and other large loads in the U.S. It discloses which gas hubs will see outsized growth opportunities and which gas producers are exposed.

Quantum Bets Big on Natural Gas With $3B Cogentrix Acquisition (Reissue)This Deal Insight examines Quantum Capital’s recent $3 billion acquisition of Cogentrix’s 11 natural gas-fired power plants from the Carlyle Group. The analysis covers key factors impacting valuation, including forward power price curves, projected power demand and capacity market prices.

Subpart W Revision | Modeling a New Baseline and the Super-Emitter Wild Card – This report analyzes the operator-level impact of the EPA’s finalized Subpart W reporting rule change under multiple scenarios and examines the risk that super-emitter events could add going forward.

Picture of Alex Nevokshonoff, Enverus Intelligence® | Research (EIR) Contributor

Alex Nevokshonoff, Enverus Intelligence® | Research (EIR) Contributor

Alex joined Enverus in April of 2022 as a member of the CCUS team before shifting coverage to Low Carbon Fuels with an initial emphasis on hydrogen. He holds a degree in mechanical engineering from the University of Calgary, which he earned in 2020. Prior to joining Enverus, he completed a 12-month internship and gained two years of post-graduate experience at Canadian Natural Resources Limited, where he worked at their Horizon Oilsands Plant. Alex is based in Enverus's Calgary office.

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