Project to Use Offshore Wind to Produce Hydrogen and Green Ammonia
A pioneering project is aiming at replacing fossil hydrogen with renewable hydrogen in the production of ammonia, which could contribute to lower carbon emissions from food production and providing a future source of fuel for the shipping industry. The project, which is being led by Ørsted, the Danish energy company and developer of offshore wind projects, and fertilizer company Yara, has the potential to abate more than 100,000 tons of CO2 per year, equivalent to taking 50,000 conventional cars off the road.
Yara and Ørsted plan to develop a 100 MW wind-powered electrolyzer plant for renewable hydrogen production. The aim is to replace fossil-based hydrogen with renewable hydrogen for ammonia production in Yara's Sluiskil plant, located in the Netherlands. According to the partners, the renewable hydrogen would generate around 75,000 tons of green ammonia per year, which is approximately 10 percent of the capacity of one of the ammonia plants in Sluiskil.
The new plant would be powered by a renewable energy supply from Ørsted's offshore wind farms. Ørsted is preparing to inaugurate its Borssele 1&2 offshore wind farm, the second biggest in the world, which is located near the Sluiskil plant.
The green ammonia, which would be produced at that the plant, would be used in the production of carbon-neutral fertilizer products helping to decarbonize the food chain. Also, with the extensive research on-going into ammonia as a source of marine power, it has potential as a future shipping fuel.
There, however, are significant hurdles to be overcome to realize the potential of this project. Hydrogen produced from renewable energy sources, while offering a carbon-free alternative to fossil-based hydrogen, has a significantly higher cost of production. The partners note that reducing the costs will require both time and significant investments in the technology and large-scale renewable hydrogen and ammonia production.
Ørsted and Yara believe the realization of the project will depend on public support to supplement private investments. As such, they will seek public co-funding for the development and construction of the 100MW electrolyzer facility. Another factor in the success of the project will be ensuring that the right regulatory framework is in place they noted.
Subject to sufficient co-funding and a confirmed business case, a final investment decision to build the new plant could be taken in late 2021 or early 2022 the companies said. They believe the project could be operational in 2024 or 2025.