Energy and climate policy implications on the deployment of low-carbon ammonia technologies

Abstract

The economic feasibility of low-carbon ammonia production pathways, such as steam methane reforming with carbon capture and storage, biomass gasification, and electrolysis, is assessed under various policy frameworks, including subsidies, carbon pricing, and renewable hydrogen regulations. Here, we show that employing a stochastic techno-economic analysis at the plant level and a net present value approach under the US Inflation Reduction Act reveals that carbon capture and biomass pathways demonstrate strong economic potential due to cost-effectiveness and minimal public support needs. Conversely, the electrolytic pathway faces significant economic challenges due to higher costs and lower efficiency. We conclude that efficient decarbonization of ammonia production requires adapting the Haber-Bosch process for variable bioenergy quality, ensuring safe CO2 transport and storage, advancing research to lower costs and improve efficiency in renewable energy and storage technologies, as well as creating a technologically neutral policy framework.