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Applied Energy 294 (2021) 116170

Contents lists available at ScienceDirect

Applied Energy
journal homepage: www.elsevier.com/locate/apenergy

Global potential of green ammonia based on hybrid PV-wind power plants


Mahdi Fasihi a, *, Robert Weiss b, Jouni Savolainen c, Christian Breyer a
a
LUT University, Yliopistonkatu 34, 53850 Lappeenranta, Finland
b
VTT Technical Research Centre of Finland, Vuorimiehentie 3, 02044 Espoo, Finland
c
Semantum Ltd., Tekniikantie 14, 02150 Espoo, Finland

H I G H L I G H T S

• Green ammonia can be produced for 370–450 €/tonne in all continents by 2030.
• The production costs at the best sites could decline to 285–350 €/tNH3 by 2050.
• Coal-based ammonia in China is the first to be substituted by green ammonia.
• Flexible synthesis units have a major role in low-cost green ammonia production.
• PV is a dominating source of power supply to islanded plants in most of the world.

A R T I C L E I N F O A B S T R A C T

Keywords: Ammonia is one of the most commonly used feedstock chemicals globally. Therefore, decarbonisation of
Hybrid PV–wind ammonia production is of high relevance towards achieving a carbon neutral energy system. This study in­
Battery vestigates the global potential of green ammonia production from semi-flexible ammonia plants utilising a cost-
Power-to-Ammonia (PtA)
optimised configuration of hybrid PV-wind power plants, as well as conversion and balancing technologies. The
Power-based chemicals
Power-to-X
global weather data used is on an hourly time scale and 0.45◦ × 0.45◦ spatial resolution. The results show that,
Energy economics by 2030, solar PV would be the dominating electricity generation technology in most parts of the world, and the
role of batteries would be limited, while no significant role is found for hydrogen-fuelled gas turbines. Green
ammonia could be generated at the best sites in the world for a cost range of 440–630, 345–420, 300–330 and
260–290 €/tNH3 in 2020, 2030, 2040 and 2050, respectively, for a weighted average capital cost of 7%.
Comparing this to the decade-average fossil-based ammonia cost of 300–350 €/t, green ammonia could become
cost-competitive in niche markets by 2030, and substitute fossil-based ammonia globally at current cost levels. A
possible cost decline of natural gas and consequently fossil-based ammonia could be fully neutralised by
greenhouse gas emissions cost of about 75 €/tCO2 by 2040. By 2040, green ammonia in China would be lower in
cost than ammonia from new coal-based plants, even at the lowest coal prices and no greenhouse gas emissions
cost. The difference in green ammonia production at the least-cost sites in the world’s nine major regions is less
than 50 €/tNH3 by 2040. Thus, ammonia shipping cost could limit intercontinental trading and favour local or
regional production beyond 2040.

from 2006 to 2016 and is expected to continue this trend during the
coming decades [1]. For a century, industrial ammonia production has
1. Introduction
been mainly based on thermochemical conversion of hydrogen and ni­
trogen through the Haber-Bosch process [3]. While nitrogen is captured
The global ammonia production reached 176 million metric tons in
from air, the required hydrogen is almost entirely based on fossil fuels.
2016, of which about 79% was used in the production of fertilisers [1],
About 83% of required hydrogen is produced by integrated steam
and the remaining for industrial applications, such as manufacturing of
reforming of natural gas, naphtha, liquefied petroleum gas (LPG) and
plastics, fibres, explosives, amines, amides and other organic nitrogen
refinery gas, and approximately 16.5% is produced by partial oxidation
compounds [2]. Being associated with food supply of a growing popu­
of fossil coal or heavy hydrocarbons such as heavy oil [2,4]. Currently,
lation, the ammonia demand experienced an average growth of 1.9%

* Corresponding author.
E-mail address: mahdi.fasihi@lut.fi (M. Fasihi).

https://doi.org/10.1016/j.apenergy.2020.116170
Received 3 May 2020; Received in revised form 27 September 2020; Accepted 30 October 2020
Available online 30 April 2021
0306-2619/© 2020 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/).
M. Fasihi et al. Applied Energy 294 (2021) 116170

production by offshore wind and grid electricity as the balancing solu­


Nomenclature tion in the US. Later, Morgan et al. [19,20] did a case study for Power-to-
Ammonia (as a feedstock, fuel or storage medium) in a remote US island.
a year Frattini et al. [21] evaluated energy efficiency of biogas, biomass and
ASU Air Separation Unit solar-wind electricity to ammonia and concluded lowest energy demand
capex Capital Expenditures for the solar-wind case. Nayak-Luke et al. [22] modelled a green
FLh Full Load hours ammonia system based on fixed capacities of solar and wind power in
GHG Greenhouse Gas Shetland, Scotland and sized other units accordingly. This study used
HHV Higher Heating Value fuel cells as the only power balancing technology. Armijo and Philibert
HVAC High-Voltage Alternating Current [23] modelled the production of green ammonia based on a cost-
HVDC High-Voltage Direct Current optimised combination of a flexible ammonia synthesis unit, solar and
LCOE Levelised Cost of Electricity wind energy in 4 locations in Chile and Argentina. The University of
opex Operating Expenditures Minnesota together with the U.S. Department of Energy’s National
PV Photovoltaic Renewable Energy Laboratory (NREL) and Proton OnSite are developing
RE Renewable Electricity a small-scale wind-powered ammonia production [24].
SMR Steam Methane Reforming The above-mentioned studies advance the knowledge on Power-to-
WACC Weighted Average Cost of Capital Ammonia; however, they are limited in several aspects, namely stud­
ied locations, applied technologies, estimation of production potential
Subscripts and time scale. With the ongoing steep decline in the cost of PV and
el electricity battery systems [25,26], they are unneglectable parts of any energy
fix fixed system modelling. In this study, a model is provided that evaluates the
th thermal cost-optimised configuration of solar PV, wind, as well as hourly and
var variable seasonal balancing technologies for islanded ammonia production
globally based on actual hourly weather data in a 0.45◦ × 0.45◦ spatial
resolution. To the knowledge of the authors, this is the first global green
ammonia atlas. The ammonia production cost and the production chain
the fossil-feedstock for ammonia production, together with auxiliary
configuration are evaluated based on the projected techno-economic
fossil-based electricity, contribute more than 1.0% of the global green­
advancements from 2020 to 2050 in 10-year time steps (Appendix A),
house gas (GHG) emissions [5]. This is considerable amount of GHG
both at the electricity generation site (Onsite Scenario) and at the nearest
emissions from a single non-carbon compound. Thus, decarbonisation of
coast for possible export option (Coastal Scenario).
ammonia production is of high relevance to meet the targets of the Paris
The cost-competitiveness of RE-based ammonia with fossil-based
Agreement in limiting global warming [6,7].
ammonia is evaluated at different natural gas prices and CO2 emission
The research on sustainable ammonia production is divided into
costs. Once ammonia is decoupled from the fossil fuels, its applications
three major groups. The first group is focused on cleaner ammonia
could well expand beyond fertilisers, to a fuel or storage medium.
production from fossil fuels (commonly known as blue ammonia)
Grinberg Dana et al. [27] evaluated the Power-to-Fuel-to-Power effi­
through broadly discussed carbon capture from CO2 emitting processes
ciency of ammonia and alternative fuels. Wang et al. [28] and Elishav
[8,9]. However, this method would still face sustainability issues due to
et al. [29] evaluated and compared the energy storage cost of ammonia
efficiency losses in carbon capture and concerns about geological limits
and an aqueous solution of ammonium hydroxide and urea with alter­
for sustainable and permanent CO2 storage. The second group focusses
natives such as lithium-ion battery, compressed air, pumped hydro and
on the use of renewable energy and feedstock for ammonia production
methanol. Valera-Medina et al. [30] reviewed the concept of ammonia
(commonly known as green ammonia), which is the focus of this study.
for producing power. Wang et al. [31] analysed the feasibility of
The third group focusses on the new synthesis methods such as elec­
ammonia production using excess electricity from large-scale PV sys­
trochemical ammonia production to simplify the process and increase
tems in China. Ikäheimo et al. [32] investigated the multidimensional
the efficiency [10–12], however, such technologies are not yet
role of Power-to-Ammonia as a fuel and a storage medium for a fully
commercially available.
renewable power and heat system in the future for Northern Europe.
Using commercially available technologies, the ammonia production
Application of ammonia as a fuel or a storage medium could increase its
can be fully decarbonised using renewable electricity (RE) for hydrogen
demand exponentially.
generation (mainly via water electrolysis) and other processes, elimi­
In summary, the main objectives of this study are: firstly, creating a
nating carbon from the ammonia production cycle. Hydropower-based
global cost-capacity atlas of green ammonia; secondly, analysis of a cost-
ammonia production has a commercial history going back to 1920s
optimised power-to-ammonia plant configurations and identifying
[3,13], which, later became less cost-competitive and was discontinued
major balancing technologies globally in high spatial resolution; and
due to the cost decline of natural gas. However, with the current ongoing
thirdly, identifying time and regions for fuel parity of green ammonia
cost decline of solar photovoltaic (PV) and wind power, RE-based
with fossil-based ammonia and evaluating potential importer and
ammonia is regaining attention. Proton Venture already offers small-
exporter regions.
scale Power-to-Ammonia systems up to 20,000 tNH3/a net capacity
The applied methods are explained in Section 2. Results are pre­
[14] with solar and wind as the source of power. To prepare for large-
sented and discussed in Section 3. Conclusions are drawn in Section 4.
scale green ammonia production, Yara will install and test a new 5
GW alkaline water electrolyser to supply 1% of hydrogen to their con­
2. Methods
ventional ammonia plant in Porsgrunn, Norway [15]. In addition, a 5
bUSD agreement has been signed for the development of a first large-
2.1. Ammonia synthesis unit
scale Power-to-Ammonia plant based on hybrid PV-wind power supply
in Saudi Arabia [16].
A Haber-Bosch ammonia (NH3) plant produces anhydrous liquid
From recent academic research, Tunå et al. [17] investigated the cost
ammonia from hydrogen (H2) and nitrogen (N2). In a NH3 plant, the
of biogas-, biomass- and electrolyser-based ammonia production (via
Haber-Bosch synthesis itself takes place in a reactor within a synthesis
wind-supplied grid electricity) on a range of small-scale plants. Morgan
loop. The synthesis is a catalytic reaction within a pressure range of
[18] performed a detailed techno-economic analysis of ammonia
100–250 bar and temperature range of 350–550 ◦ C [4]. In this study, a

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M. Fasihi et al. Applied Energy 294 (2021) 116170

900
(1)

NH3 synthesis loop 3H2 (g) + N2 (g)→2NH 3 (g), Δf H = − 45.64kJ/molNH3

800 Air Separation Unit Based on Morgan [18], modified to a 99% overall conversion factor
NH3 storage for an all-electric NH3 plant, the synthesis loop would require 648 kWh/
700 tNH3, including the power demand for compression of input H2 and N2
(from 1 and 8 bar, respectively) to reactor’s pressure of 150 bar (abso­
600 lute pressure, also known as bara). The cryogenic air separation unit
(ASU) would require 90 kWh/tNH3 for capturing the required N2 from
Capex (€/tNH3.a)

500 air. The power requirement for ammonia storage would be negligible.
Thus, the total direct electricity demand would be 738 kWh/tNH3. It is
400 assumed that the specific electricity consumption remains constant for
different plant sizes.
300 The scale has an impact on the capital expenditure (capex) of a Haber-
Bosch NH3 plant. Typical modern large-scale NH3 plants have production
200 capacity of 1000–2000 tons of NH3 per day [2], and new plants are
designed for capacities reaching 3000 tons of NH3 per day equivalent to
100 1,000,000 t/year. Power laws were fitted to the capex estimations in
USD2010 for the synthesis loop, ASU and ammonia storage in respective
0 capacity units presented in Morgan [18] as shown in Eqs. (2.1)–(2.3).
50

150

250

350

450

550

650

750

850

950 (2.1)
1.340
Capexsynthesis loop = 23850000∙Capacity(tNH3) − + 173500
day
Capacity (ktNH3/a)
(2.2)
0.6249
CapexASU = 1606000∙Capacity(tN2) − + 9318
Fig. 1. Capex development of all-electric NH3 plants, excluding the electrolysers. day

CapexNH3 storage = 46600∙Capacity(tNH3) − 0.8636


+ 536.9 (2.3)
temperature of 480 ◦ C and a pressure of 150 bar for the Haber-Bosch
synthesis unit are considered based on Morgan [18]. Flexibility of the The overall capex of the ammonia plant is calculated by sizing the
synthesis unit could minimise power and hydrogen balancing demand, ASU to the synthesis loop’s nitrogen demand and considering 30 days of
and consequently the overall cost in regions that do not have access to ammonia storage. Then the values are converted from USD2010 to €2019,
relatively stable power supply or cheap geological hydrogen storage. by considering a cumulative inflation of 17.24% on USD from 2010 to
Armijo and Philibert [23] considered two scenarios with 40% and 80% 2019 [33] and then applying an USD/€ exchange rate of 1.12 in 2019
flexibility with maximum 20% ramp up and ramp down rates per hour, [34]. The resulted overall capex of the ammonia plant is illustrated in
based on the literature and interviews with manufacturers. In this study, Fig. 1 for a capacity range of 50,000 to 1,000,000 tNH3/a. While the
after consulting industry experts, a minimum load of 50%, a ramp up illustrated capex decline is in line with the concept of economies of scale
limit of 2% and a ramp down limit of 20% per hour are considered for the for the ammonia plants, small-scale ammonia plants could remain
ammonia synthesis unit coupled with the air separation unit at no major competitive through a modular design, wider range of potential investors
additional cost or efficiency loss. Morgan [18] considers a 100% mass and elimination of product transportation, as pointed out by Brown [35].
conversion factor for the overall reaction (Eq. (1)), which implies the
possibility of full conversion of feedstock to final product. However, in a 2.2. Power-to-Ammonia value chain and scenarios
conservative approach, a conversion factor of 99% is assumed in this
study to account for potential losses, especially for a plant based on Two scenarios (Onsite and Coastal) are modelled to represent the
variable load operation, which leads to 179.4 kgH2 and 830.7 kgN2 con­ potential of local consumption and export cases. The applied methods
sumption per ton of ammonia production. The ammonia production re­ are based on Fasihi and Breyer [36] which can be referred to for a more
action is exothermic, and the net recoverable heat depends on the plant’s extensive model description.
configuration. No usage is specified for the excess heat in this study. In the Onsite Scenario, illustrated in Fig. 2, the ammonia plant is at the
electricity generation site. Electricity is generated by a cost-optimised

curtailed

Battery
storage HT heat

PV Semi-flexible
Battery O2 LT heat
fixed tilted Water ASU (N2 capture),
interface Baseload
feed gases
NH3 supply
Water compressors and
PV NH3
Electrolyser NH3 synthesis unit
single-axis storage
tracking
H2 underground pipeline
H2-OCGT

H2-CCGT

Wind
Comp.

onshore H2 lined rock cavern


H2

H2 salt cavern

Fig. 2. Power-to-Ammonia Onsite model configuration. Commercially available hydrogen-fuelled gas turbines are considered from 2030 onwards. Abbreviations: H2-
fueled open cycle gas turbine, H2-OCGT, H2-fueled combined cycle gas turbine, H2-CCGT, hydrogen compressor, H2 Comp, high temperature heat, HT heat, low
temperature heat, LT heat. Green and blue lines represent electricity and hydrogen flow, respectively.

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M. Fasihi et al. Applied Energy 294 (2021) 116170

configuration of fixed tilted PV, single-axis tracking PV and wind tur­ seasonal balancing technology. Major gas turbine manufacturers have
bines. Hydrogen is generated by a cluster of flexible alkaline water set a target to make hydrogen-fuelled gas turbines commercially avail­
electrolysers [37] at 30 bar, which can be directed to the ammonia plant. able by 2030 [44,45]. Thus, the power-to-hydrogen-to-power (PtH2tP)
The excess hydrogen generation is stored in locally available hydrogen system is included in the model from 2030 onwards. In the Onsite Sce­
storage options via hydrogen compressors [38,39] to balance hydrogen nario, capex is based on a medium sized (400,000 tNH3/a) plant to match
supply to the ammonia plant at hours with direct hydrogen deficit. The the local or regional ammonia demand. However, to supply a fixed de­
potential hydrogen storage options considered in the model are man- mand, the actual installed capacity could be higher in different locations
made salt cavern and rock cavern at a range of 60–200 bar operating depending on the capacity factor of a semi-flexible ammonia plant. The
pressure and underground pipeline storage at 20–200 bar pressure. To additional capex reduction in such a case is not included and it is
maintain the minimum pressure, salt and rock cavern require cushion assumed to be offset by the potential additional costs of flexible opera­
gas at about 30% of their gross capacity or 43% of operational capacity tions. The cost of fresh water demineralisation system, which is esti­
[40]. The cost of cushion gas is included in the salt and rock cavern mated to be about half of the seawater desalination cost, is negligible
capex. The maximum hourly charge or discharge of salt and rock cavern and is assumed to be included in the cost of electrolyser package.
is limited to 8% per day (0.33% per hour) of operational capacity to Whether fresh water would be available locally or supplied by desali­
avoid extra tension on walls due to rapid pressure change. For under­ nated water from nearest coast, the additional cost of water supply is
ground pipeline, the maximum hourly charge or discharge is limited to negligible according to Fasihi and Breyer [36], and thus it is not
16.67% of the operational capacity (minimum 12 h for full charge or included in the model. More information about water supply by desa­
discharge) for the sake of temperature change management [40]. While lination plants is provided in the Supplementary Information.
salt cavern and to some extent rock cavern are relatively cheaper options The above-mentioned setup is rather conservative. The electricity
for large-scale and seasonal hydrogen storage, their availability is demand from the hydrogen compressors coupled to an ammonia plant is
limited around the globe. Data on suitable regions for salt or rock cavern calculated from 1 bar, while the hydrogen supplied by the electrolysers
storage are taken from Aghahosseini and Breyer [41] and are provided and hydrogen storage options would be at higher pressures, leading to a
in Fig. S10. The compressors’ electricity demand for adiabatic lower actual electricity demand for hydrogen compression in the syn­
compression of hydrogen in the range of 30 to 200 bar is 0.053 kWh/ thesis loop. Moreover, the electrolyser efficiency at part-load operation
kWhH2,HHV, according to Makridis [42]. However, during most hours of is higher [22] which is not considered in this study.
a year, storage level would not be at the maximum capacity and pres­ In the Coastal Scenario, the nearest node from ocean shoreline to the
sure. Therefore, hydrogen injection to the storage can be done at a lower power plant site is identified and the ammonia plant is located at a
compression range by compressors, representing a lower electricity neighbouring coastal node of the ocean node. If there are more than one
demand. In this study, average power consumption at 75% of a full costal node around the nearest ocean node, the chosen coastal node is
range compression is considered. Thus, the compressors’ electricity prioritised based on availability of firstly salt cavern or secondly rock
consumption is fixed at 0.04 kWh/kWhH2,HHV. The compressor capex is cavern among the nominated costal nodes, in order to increase available
based on 150 MWH2,LHV units, calculated according to the capex of 6 low-cost hydrogen storage options at coast. The costal node is connected
MWH2,LHV units by Grond et al. [38] and a scaling factor of 0.67 based on to the power plants via high-voltage alternating current (HVAC) and
Hannula [43]. Electrical storage is included in the model, primarily to high-voltage direct current (HVDC) transmission lines. Considering the
supply electricity to the ammonia plant (including the air separation natural barriers, length of the power lines is set at 110% of the direct
unit), as well as increasing the operating hours of the electrolysers if it is distance to the nearest coast. Electricity can be optionally balanced
part of a cost-optimised solution. The electricity storage system consists before the transmission lines via battery or PtH2tP technologies, as
of an independently scalable battery interface and battery storage, as illustrated in Fig. 3.
well as open cycle and combined cycle hydrogen-fuelled gas turbines as

curtailed

Water
Electrolyser

H2
Comp.

Battery
storage

PV
H2-OCGT

H2-CCGT

fixed tilted Battery


interface AC/DC HVDC DC/AC
PV conv. transmission line conv. to electricity balancing
single-axis and PtA plant at coast
HVAC
tracking
transmission line

Wind
onshore

Fig. 3. Configuration of power source, balancing and transmission option for the Coastal Scenario. Hydrogen-fuelled gas turbines are assumed from 2030 onwards.
The potential impact of AC transformer is not considered. Abbreviations: photovoltaic, PV, compressor, comp., hydrogen-fuelled open cycle gas turbine, H2-OCGT,
hydrogen-fuelled combined cycle gas turbine, H2-CCGT. Green and blue lines represent electricity and hydrogen flow, respectively.

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M. Fasihi et al. Applied Energy 294 (2021) 116170

The transportation of Onsite ammonia to the coast via pipeline is an self--discharge, self-disch.
other option for providing ammonia at the coast. This option was
discht
excluded from this study due to lack of access to high spatial resolution ∀t ∈ [2,8760]SoCt = SoCt− 1 ∙(1− hourly selfdisch eff .)−
disch eff . (6.1)
information about geological conditions which could impact the cost of
+chart ∙char eff .
ammonia pipeline significantly.
The Eqs. (3) and (4) are used to calculate the levelised cost of energy
disch1
(LCOE) for power plants and the subsequent value chains, based on SoCt=1 = SoC8760 ∙(1− hourly selfdisch eff .)− +char1 ∙char eff .
disch eff .
NREL guidelines [46]. Abbreviations: applied technology, i, capital ex­
penditures, Capex, annual fixed operational expenditures, Opexfix, vari­ (6.2)
able operational expenditures, Opexvar, full load hours per year, FLh, fuel The cost-optimised configuration of components in achieving the
costs per unit of energy, fuel, efficiency of fuel convertor, η, annuity above-mentioned energy and mass balance is found by Mosek [48]
factor, crf, weighted average cost of capital, WACC, lifetime, N. The linear optimiser, as presented in Eq. (7). Abbreviations: installed ca­
weighted average cost of capital (WACC) is set to 7% in all regions and pacity, instCap, generation, Gen.
simulations based on an equity share of 30% and an interest rate of 4% ( )
∑tech
(excluding inflation) which would lead to a return on equity of 14%. All min (7)
(CAPEX i ∙crfi + OPEXfixi )∙instCapi + OPEXvar i ∙Geni
efficiency and capex numbers are based on the higher heating value i

(HHV), when applicable.


The world is divided into 0.45◦ × 0.45◦ nodes, representing an area
WACC∙(1 + WACC) N
range of 2500 km2 for nodes at the equator to less than 1200 km2 at
crf = (3)
(1 + WACC)N − 1 regions beyond ±60◦ latitudes [36]. Average area coverage of 8.4 and
75 MW/km2 is assumed for wind and PV power plants, respectively
Capexi ∙crf + Opexi,fix fuel [49]. A 10% area limit is set for PV (total of fixed tilted and single-axis
LCOEi = + Opexi,var + (4)
FLhi ηi tracking) and a 10% area limit is set for wind power plant installations at
each node. First, the optimisation is done for a relatively small-scale
The modelling is done in Matlab R2016a [47]. The hourly energy and demand and then the system is scaled up until installed PV or wind
mass balance in all scenarios are based on Eqs. (5.1)–(5.4) for electricity capacity reaches to its area limit, representing the potential capacity of
generators (fixed tilted and single-axis tracking PV, wind energy, battery the cost-optimised configuration at each node.
power, H2-OCGT, H2-CCGT), electricity consumers (electrolyser,
compressor, ammonia plant), battery storage charge and discharge, 3. Results and discussion
curtailed electricity, H2 generator (electrolyser), H2 consumers
(compressor, H2-OCGT, H2-CCGT, ammonia plant), H2 storage options 3.1. Levelised costs and annual production potential of ammonia
charge and discharge and electricity conversion and transmission tech­
nologies (AC/DC converter, HVAC, HVDC). Abbreviations: technology, The levelised cost of ammonia (LCOA) in a cost-optimised configu­
tech, electricity, El, time, t, generation, gen, consumption, cons, battery, ration for the Onsite and Coastal Scenarios for the years 2020 to 2050 in
Batt, charge, char, discharge, disch, electricity curtailment, curt, Trans­ 10-year steps are illustrated in Fig. 4. For the Onsite Scenario in 2020,
mission Line, TL. ammonia can be produced at best sites, such as Patagonia, Atacama
electricity balance, Onsite Scenario : Desert, Tibet and the Horn of Africa for costs below 600 €/tNH3. Theo­
retically, Greenland has the least cost production site in 2020, however
∑tech ∑tech
Elgen,t − Battchar,t + Battdisch,t − Elcurt,t = Elcons,t (5.1) its technical potential is very limited due to glaciers and permanent ice
t t
coverage in most parts of Greenland. In 2030, Atacama Desert, Horn of
Africa, Yemen and Southwest Niger are the least cost regions at costs
electricity balance, Coastal Scenario (before and after TL) :
between 350 and 400 €/tNH3, while costs below 500 €/tNH3 become
∑tech ∑tech ∑tech achievable in most regions of South America’s coastlines, Mexico,
Elgen,t − Elcons,t − Battchar,t + Battdisch,t − Elcurt,t = TLin,t
t t t Central and Southwest US, Australia, Africa, MENA region and Central
∑tech ∑tech ∑tech Asia. In Europe, such cost levels are achievable in Spain, Portugal, UK,
t
TLin,t − t
TLloss,t = t
TLout,t Iceland and Denmark. In 2050, the production cost at best sites declines
to about 260 to 300 €/tNH3, while costs below 450 €/tNH3 are achievable
∑tech ∑tech ∑tech
TLout,t = Elcons,t − Elgen,t + Battchar,t − Battdisch,t (5.2) in most habitable regions of the world. The higher cost of ammonia
t t t
production beyond ±60◦ latitudes is not of high relevance because ni­
hydrogen balance, Onsite Scenario : trogen fertilisers demand, as the main ammonia consumer, is not sig­
nificant in those regions as shown for the case of Europe by EC [50] in
∑tech ∑tech ∑tech ∑tech Fig. S4. Armijo and Philibert [23] report on a production cost below 500
H2gen,t − H2storagechar,t + H2storagedisch,t = H2cons,t
t t t t USD/tNH3 in near-term at the vicinity of Atacama Desert, which is
(5.3) cheaper than the calculated production cost of about 550–600 €/tNH3 in
2020 in this study. While these two studies consider a WACC of 7% and
hydrogen balance, Coastal Scenario (before and after TL, separately) :
almost equal capex for electrolyser, Armijo and Philibert [23] consider
∑tech ∑tech ∑tech higher PV capex which is compensated by higher electrolyser efficiency.
H2gen,t −
t t
H2 storagechar,t + t
H2 storagedisch,t However, considering the major differences, Armijo and Philibert [23]
∑tech consider lower electrolyser opex, lower synthesis unit capex and opex, as
= H2cons,t (5.4)
t well as a higher ramp up rate that lead to lower ammonia production
The state of charge (SoC) in storage facilities is formulated as in Eqs. cost.
(6.1) and (6.2), that take into account independently the hourly For the Coastal Scenario, the cost of ammonia from remote areas is
charging step losses, discharging step losses and hourly self-discharge of usually relatively higher, as the cost of delivered electricity to the coast
stored power, hydrogen or ammonia. In Appendix A, the total charge increases by distance. One exception is when a node with relatively
and discharge efficiency is defined as cycle efficiency. Abbreviations: strong seasonality of power supply does not have access to a geological
storage state of charge, SoC, efficiency, eff, charge, char, discharge, disch, hydrogen storage onsite but has access to cheap storage option at the

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Fig. 4. Levelised cost of ammonia Onsite (left) and Coastal (right) for 2020 (top), 2030 (upper centre), 2040 (lower centre) and 2050 (bottom).

coastal node. Consequently, the cost decline by access to cheap Atacama Desert, Northern and Western Australia, Arabian peninsula,
hydrogen storage at coast could compensate the additional cost of the Tibet and most of Africa. For the Costal Scenario, the optimal capacity
transmission lines. Thus, hydrogen pipelines to sites of accessible salt decreases due to additional efficiency losses.
cavern hydrogen storage may economically pay off, even for distances of While an availability factor of 91% (8000 FLh) is considered for the
some hundreds of kilometres. At about 1000 km distance, the additional ammonia synthesis unit, the semi-flexible plant shows a capacity factor
cost of costal ammonia compared to the Onsite Scenario would increase of 70–91% around the globe in 2030, with higher range in regions with
from about 10% in 2020 to 30–40% in 2050, depending on the region, relatively seasonally stable PV-based power supply or access to
while the absolute cost difference decreases to 40–100 €/tNH3 in 2050 relatively cheap geological hydrogen storage as shown in Fig. S16.
which could make low-cost ammonia at remote areas favourable if the Consequently, the required ammonia storage for baseload supply of
local production is significantly more expensive. ammonia throughout the year is zero to less than 30 days of baseload
The area coverage of individual PV and wind is limited to 10% of the production in most parts of the world, as illustrated in Fig. S16.
area within each node. Accordingly, the cost-optimal system could have In Fig. 6, the global optimal generation potential from Fig. 5 are
an area coverage of 10–20% depending on the ratio of installed tech­ sorted based on the ammonia production cost, as generation capacity at
nologies. The potential optimal capacity at PV-dominated regions is least cost sites is more desired. Although the global ammonia production
higher due to higher annual electricity generation capacity per area of was about 176 million tons in 2016 [1], here the ammonia production
PV compared to wind turbines. As illustrated in Fig. 5, the highest cost for up to 10 Gt/a capacity has been discussed. The allocated global
optimal capacity of 1.7–2.5 MtNH3/a per 1000 km2 is observed at the

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Fig. 5. Power-to-Ammonia optimal capacity potential (top) and generation potential (bottom) for Onsite (left) and Coastal (right) scenarios in 2030 with 10% land
use limit for PV and wind power plants per 1000 km2.

Fig. 6. Industrial cost curves for Power-to-Ammonia, based on cost-optimised hybrid PV-wind power plants for the period 2020 to 2050.

generation capacity is less than 10% of the global generation potential be up to 35 and 20 €/tNH3 more expensive than the respective cumula­
(with partial use of area in respective nodes) but offers more than 50 tive capacity in Onsite scenario. Detailed regional cost analysis, cost
times the required capacity at multiple regions in response to un­ comparison to conventional ammonia, fuel parity and impact of CO2
certainties regarding the availability of land at the least cost sites. emissions cost are discussed later in this section.
However, expansion of ammonia applications as a fuel could increase
the demand exponentially. In 2020, the first 1–10 GtNH3/a could be
produced at about 440–630 €/tNH3, while the production cost for the 3.2. Technology mix of cost-optimised systems
same annual capacity declines to 345–420, 300–330 and 260–290
€/tNH3 in 2030, 2040 and 2050, respectively. In 2020, the least cost The global results for 2030 and 2050 are provided and analysed in
Coastal ammonia production is slightly cheaper than the least cost Onsite this section for better understanding of the global variation of major
ammonia. This is because in 2020 Onsite scenario, some of the least cost components in a cost-optimised system. Figures for 2020 and 2040 are
sites are close to the coastline and the additional cost of transmission available in the Supplementary Data (Figs. S5–S15).
lines to the coast is negligible for the respective sites in the Coastal As shown in Fig. 7, by 2030, PV is the dominating electricity supply
scenario, while they benefit from a cheaper synthesis unit due to the technology to RE-based ammonia plants in most parts of the world with
selection of larger plants for Coastal scenario and economies of scale. the exception of Patagonia, Northern Canada, Iceland, UK and coastal
The production of 10 GtNH3 for Coastal scenario in 2030 and 2050 would lines of Western Europe, which are all excellent wind sites. The share of

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Fig. 7. Ratio of PV to hybrid PV-wind installed capacity for ammonia Onsite (left) and Coastal (right) for 2030 (top) and 2050 (bottom).

Fig. 8. Ratio of battery discharge to total electricity demand (TED) onsite for ammonia Onsite (top), before transmission lines for ammonia Coastal (middle) and after
transmission lines for ammonia Coastal (bottom) for 2030 (left) and 2050 (right).

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PV further increases by 2050 due to a sharper projected cost decline. electricity generated by gas turbines is only used to supply the direct
Low-cost PV and battery fully eliminate wind electricity from the power electricity demand by the synthesis unit and does not feed into the
supply to islanded Power-to-Ammonia plants in Africa. In the Coastal electrolyser due to additional efficiency loss. On the other hand, gas
Scenario, the ratio of wind power is relatively higher in remote areas, as turbines before the transmission lines in the Coastal scenario have a
higher FLh of wind reduces the cost of electricity transmission lines. relatively stronger role in some regions with significant variability of
As illustrated in Fig. 8, the share of battery discharge to total elec­ power supply, but access to geological hydrogen storage onsite and not
tricity demand (TED, defined as electricity demand by ammonia syn­ at the coast. In such conditions, gas turbines before the transmission
thesis unit and water electrolyser for feedstock hydrogen, excluding the lines mainly firm the direct electricity demand by the synthesis unit at
hydrogen as fuel for gas turbines) remains at about 3.5–4.5% in PV- the coast. In some regions of Northeastern Russia, with high seasonality
dominated regions for the Onsite Scenario, which is mainly to supply of power supply but access to geological hydrogen storage, gas turbines
direct electricity demand for the air separation unit and the ammonia before the transmission lines also contribute to power supply to the
synthesis plant. The role of batteries is significantly lower in wind electrolysers at the coast. Nevertheless, these are some of the most
dominated regions, such as Patagonia, due to the availability of mini­ expensive regions for synthetic fuels production in the world. Thus, the
mum electricity demand for a longer time throughout the year. In the role of H2-fuelled gas turbines for ammonia production by semi-flexible
Coastal Scenario, batteries have a significant role in balancing electricity synthesis units in low cost regions would remain zero to marginal.
supply before the transmission line (bTL) and would supply 40–55% of As shown in Fig. 10, HVAC is the dominating electricity transmission
total electricity demand for distances beyond 1500 km in 2050. The role technology for distances up to 1500 in PV-dominated regions in 2030.
of batteries is relatively smaller in 2030 due to its higher cost. With Such a HVAC penetration rate is about 50% higher than those for Coastal
supply of less than 0.1% of TED, the role of batteries after the trans­ baseload hydrogen by Fasihi and Breyer [36], which is due to a lower PV
mission lines (aTL) is almost negligible. cost assumption used in this study based on a value between ETIP-PV
The role of gas turbines is marginal in the Onsite scenario or after [25] and Vartiainen et al. [26] for the years until 2030 and then fully
transmission lines in the Coastal scenario and is up to 1% of the total following Vartiainen et al. [26], which makes higher efficiency losses
electricity demand in regions beyond ±60◦ latitudes (Fig. 9). The less relevant. In regions with a high share of wind, such as central US, the

Fig. 9. Ratio of hydrogen-fuelled gas turbines (CCGT and OCGT) generation to total electricity demand (TED) for ammonia Onsite (top), before transmission lines for
ammonia Coastal (middle) and after transmission lines (bottom) for ammonia Onsite for 2030 (left) and 2050 (right).

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Fig. 10. Ratio of HVAC to total HVAC and HVDC capacity for Coastal ammonia in 2030 (left) and 2050 (right).

Fig. 11. Power-to-Ammonia overall efficiency Onsite (left) and Coastal (right) for 2030 (top) and 2050 (bottom).

FLh of input electricity to the transmission lines is relatively higher could be as low as 40% in 2030 at far remote areas, due to higher
which reduces HVAC competitiveness to about 1000 km. In 2050, share curtailment and battery efficiency losses before the transmission lines,
of HVAC increases in the US as the share of PV increases. In PV- as well as losses in the transmission lines and conditional AC/DC con­
dominated central Africa, share of HVAC decreases from 2030 to verter stations. The overall efficiency of Coastal Power-to-Ammonia in­
2050, because batteries are cheaper in 2050 and more are installed creases in 2050, due to more efficient electrolysers, as well as increased
before the transmission lines which increases the LCOE and FLh of input role of batteries with higher efficiency and more efficient HVDC lines.
electricity to the transmission lines which in return increases the suit­
ability of more efficient HVDC transmission lines. Even at 2000 km, a 3.3. Sensitivity analyses
small share of HVAC still exists which is for electricity transmission at
peak hours. The technical and financial assumptions in any global study include
The overall efficiency of a baseload Power-to-Ammonia plant could some uncertainty regarding long-term projections and regional opera­
be 61% and 66% (HHV) in 2030 and 2050, respectively. The higher tional condition which are not considered in the presented global sim­
efficiency in 2050 is because of the projected efficiency gain by water ulations. Thus, a series of sensitivity analyses has been performed. In
electrolysers stated in Appendix A. However, as shown in Fig. 11, the each sensitivity analysis, only one parameter is diverged from its base
overall efficiency of hybrid PV-wind Power-to-Ammonia Onsite in 2030 value.
is about 50–58% worldwide. The additional losses stand for curtailment, While all the simulations in this study are done based on a global
losses in the battery and power-to-hydrogen-to-power cycle, as well as average WACC of 7%, the local WACC in most countries would be within
the electricity demand of the hydrogen compressor. The increase in the a range of 5–9% and long-term WACC projections are inherently un­
overall efficiency of Onsite Power-to-Ammonia in 2050 is not as strong as certain [51]. A WACC of 5% is possible in some parts of the world and
the efficiency gain by water electrolysers as higher levels of curtailment more regions are expected to adopt lower WACC in long term as in­
become a part of the cost-optimised solution (Fig. S9) due to lower vestment risks decline by maturing and scaling of RE-based technolo­
electricity generation costs. In the Coastal Scenario, the overall efficiency gies. An absolute 2% change in WACC would affect the ammonia

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Fig. 12. Impact of decreasing WACC to 5% (left) and increasing WACC to 9% in respect to ammonia production cost by a WACC of 7% in 2030.

Fig. 13. Impact of PV capex (top), Wind capex (centre) and battery capex (bottom) on levelised cost of ammonia Onsite in 2030.

production cost by about 14–15% in comparison to 7% WACC in 2030, The capex curve in Fig. 1 is based on a baseload RE-based ammonia
as illustrated in Fig. 12. plant configuration. Although literature and interviews with experts
The impact of a 10% change in the capex of major electricity supply suggest that moderate flexibility can be achieved for ammonia plants at
technologies (PV, wind and battery), with fixed absolute opex, on final no significant additional cost, a 10% change in the capex of the ammonia
cost of Onsite ammonia in 2030 is illustrated in Fig. 13. A 10% change in synthesis unit (coupled with ASU and 30 days of ammonia storage) in
the capex of wind and PV power plants affects the overall cost of RE- 2030 would have up to 1.5% impact on the production cost of RE-based
based ammonia by about 0–5% and 0–4%, depending on the share of ammonia, as illustrated in Fig. 14. On the other hand, baseload opera­
PV and wind in the electricity supply system. A 10% change in the capex tion of the ammonia plant could increase the feedstock supply cost, and
of battery has no significant impact on the cost of ammonia, as its role is consequently the ammonia production cost. As shown in Fig. 14, the cost
mainly limited to balancing minor direct electricity demand by the air of ammonia from a baseload ammonia plant could be up to 50% higher
separation unit and the ammonia synthesis unit. In all cases, the impact than the semi-flexible plant. The impact on the cost is less than 20% in
is minimised by system reconfiguration based on the applied cost regions with stable solar power supply or sites with access to cheap
assumptions.

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geological hydrogen storage; but could be up to 40% at low-cost sites about 1% and 2% change in the cost of RE-based ammonia in wind and
with a high share of wind in the mix of power supply, such as Patagonia. PV-dominated regions, respectively. The higher impact of electrolyser
Thus, a potentially more expensive semi-flexible ammonia unit is well capex on PV-dominated systems is because of higher installed capacities
justified. of electrolysers due to lower FLh of electricity supply by PV in com­
The sensitivity of the Onsite ammonia cost in 2030 to the capex of parison to wind turbines. This also indicates that, due to cost develop­
major hydrogen facilities (electrolyser and compressor), with un­ ment of electrolysers by 2030, electrolyser capex has a lower impact
changed opex fixed, is illustrated in Fig. 15. Since the model includes than capex of electricity supply on ammonia production cost, as shown
three different types of hydrogen storage, their capex difference already for three sample nodes in Fig. S18. The impact of a 10% change in the
represents a sensitivity analysis and thus is not repeated here with the capex of compressors is almost negligible.
10% capex change. A 10% change in the capex of electrolyser results in

Fig. 14. Impact of ammonia plant (excluding electrolyser) capex on levelised cost of ammonia Onsite in 2030.

Fig. 15. Impact of electrolyser capex (top) and hydrogen compressor capex (bottom) on levelised cost of ammonia Onsite in 2030.

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3.4. Fossil vs. RE-based ammonia CO2

3.4.1. NG-based ammonia ASU (N2 capture),


Steam H2
The main difference between conventional and RE-based ammonia is Water feed gases Baseload
in the source of electricity and hydrogen supply. Apart from China, the Methane
Steam el. compressors and NH3 supply
NG Reformer
global hydrogen supply to ammonia plants is mainly from NG via steam Turbine NH3 synthesis unit
methane reforming (SMR). According to EC [2], NG demand for the Best
Available Technology and Best Practiced Technology was about 28 and Fig. 16. NG-based ammonia production chain.
32 GJLHV/tNH3, respectively. Such NG-based ammonia plants also
generate the required electricity from by-product steam via integrated
steam turbines. Since EC [2] refers to documents from 1990s, it is ammonia production cost is compared with the cost of green ammonia
assumed that the stated Best Available Technology has become the Best at best sites with a cumulative annual ammonia production potential of
Practiced Technology by now. Thus, assuming total NG consumption of 10 GtNH3, globally.
28 GJ/tNH3 (LHV), NG-based ammonia would have direct CO2 emissions The average price of NG has historically been between 40 and 100%
of 1.57 tCO2/tNH3, excluding indirect CO2 equivalent emissions (global of the crude oil price depending on the country or region [36]. However,
warming potential) of NG leakage in the extraction, transportation and it could be expected that the price of NG in ammonia exporting regions
process chain. In addition, the average CO2 emissions of the available would potentially be in the lower half of this range. Thus, on the top
plants is higher which has not been considered. horizontal axis of Fig. 17, the approximate crude oil price at each NG
To compare the cost of NG-based ammonia and green ammonia, it is price level are provided based on a NG to crude oil price ratio of 50%
assumed that the ammonia synthesis unit remains the same and only the with an expected ±20% divergence range.
electrolyser units and hybrid PV-wind power plants are substituted with As illustrated in Fig. 17, the cost range of green ammonia at the best
SMR units and steam turbines (Fig. 16) to supply the same amount of sites with 10 GtNH3/a cumulative generation potential are about
hydrogen and electricity required for RE-based ammonia plants. In 440–630, 345–420, 300–330 and 260–290 €/tNH3 in 2020, 2030, 2040
addition, the NG-based ammonia plant would not include the additional and 2050, respectively. In 2020, green ammonia is competitive with NG-
power and hydrogen balancing units as it runs on baseload. The required based ammonia for a NG price of more than 15 USD/MMBtu (equal to a
capacities of SMR unit and steam turbine are calculated based on their crude oil price of 174 USD/bbl), which would decrease to about 13 USD/
respective efficiencies which, together with financial specifications MMBtu (~150 USD/bblcrude oil) if 28 €/tCO2 GHG emissions costs are
provided in Appendix A, would contribute to 302 €/tNH3⋅a, additional applied. In 2030, the cost competitiveness can be reached for a NG price
capex for a large-scale NG-based ammonia plant. Thus, the overall capex range of 10.3–14.1 USD/MMBtu (~120–164 USD/bblcrude oil) without
of the NG-based ammonia would be 931 €/tNH3⋅a, including 631 any CO2 emission cost, or a NG price range of 5.7–9.3 USD/MMBtu
€/tNH3⋅a for the ammonia synthesis unit. (~66–108 USD/bbl) for 61 €/tCO2 GHG emissions cost. In 2040 and
The cost of NG-based ammonia is a function of NG price and 2050, RE-based ammonia is competitive with fossil-based ammonia at
respective CO2 emissions cost. The cost of NG-based ammonia for a NG NG prices over 8.2 and 6.3 USD/MMBtu (~95 and 73 USD/bblcrude oil),
price range of 1 to 17 USD/MMBtu (2.6 to 44.6 €/MWhLHV) and CO2 respectively. For 75 €/tCO2 GHG emissions cost, fuel parity in 2040 and
emission costs of 28, 61, 75 and 150 €/tCO2 projected for the years 2020, 2050 can be even reached for NG prices as low as 2.4 and 1 USD/MMBtu
2030, 2040 and 2050 [51,52] are shown in Fig. 17. The fossil-based (~28 and 12 USD/bblcrude oil), respectively. Such GHG emission costs

NG-based ammonia vs. green ammonia at best sites with 10 GtNH3/a cumul capacity
approximate crude oil price ±20% (USD/bbl)
12 35 58 81 104 128 151 174 197
700 128

600 112

500 96
Ammonia cost (€/MWhHHV)
Ammonia cost (€/tNH3)

400 80

300 64

200 48
green ammonia 2020 green ammonia 2030
green ammonia 2040 green ammonia 2050
100 NG-based ammonia NG-based ammonia + 28 €/tCO2 32
NG-based ammonia + 61 €/tCO2 NG-based ammonia + 75 €/tCO2
NG-based ammonia + 150 €/tCO2
0 16
1 3 5 7 9 11 13 15 USD/MBtu17
NG
2.6 7.9 13.1 18.4 23.6 28.9 34.1 44.6
39.4 €/MWh NG

Fig. 17. NG-based vs. green ammonia cost for varying natural gas prices.

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are at the same level as carbon capture and permanent storage from pure small share in China’s energy system and due to severe air pollution in
point sources [36]. Thus, beyond 2030 green ammonia could be cheaper China’s major cities, NG is primarily used for the power and heat sector.
than NG-based ammonia with carbon capture and storage or with In 2012, China published new regulations for investments in the
realistic GHG emissions cost. These results indicate a steep demand ammonia industry which bans the use of NG and high-quality anthracite
growth for green ammonia latest by 2030s and the potential for coal in new ammonia plants [62]. It also puts certain limits for the en­
substituting NG-based ammonia by 2040s globally. If ammonia is not ergy consumption of existing and new ammonia plants and bans any
supplied locally, the additional transportation costs of ammonia from plant with train capacity below 365,000 tNH3/a [55,62]. As a result of
different sources should be compared as well. the new regulations and market economics, about 6 MtNH3/a capacity
The by-products of the RE-based ammonia production chain could (about 10% of China’s demand) has been closed in 2017–2018, to be
increase its competitiveness with fossil-based ammonia. Frattini et al. mainly replaced with new coal-based ammonia plants [61]. Meanwhile,
[21] identified the waste heat sources eligible for recovery from a Haber- China’s ammonia import was expected to only grow to 1 MtNH3 in 2019,
Bosch unit at 250 bar and 550 ◦ C composed by the ammonia reactor yet three times more than the 2016 level [63]. The planning of new coal-
(888 kWh/tNH3 at 550 ◦ C) and the compressors cooling system (241 based ammonia plants and limited import increase could be related to a
kWh/tNH3 at 150 ◦ C), equivalent to about 22% of the lower heating limited distribution network for imported ammonia, as well as security
value of the produced ammonia. In addition, depending on the elec­ of ammonia supply as a vital element to China’s growing food demand.
trolyser efficiency, the electrolysers supplying hydrogen to an ammonia However, Onsite Power-to-Ammonia in China has a great potential
plant would also generate about 1250–2200 kWhth of utilisable low- beyond its demands (Fig. 18) which could be cost-competitive with new
grade heat (about 80 ◦ C) and 1.6 ton of oxygen per ton of ammonia. coal-based ammonia plants at the best solar and wind sites beyond 2030.
These by-products could potentially provide additional value through As illustrated in Figs. 18 and 19, in 2020, the green ammonia pro­
regional circular economy opportunities, such as district heating or as duction cost at the best sites in China with 1000 Mt annual ammonia
main energy input to low temperature CO2 direct air capture systems production capacity would be in the range of 550–660 €/tNH3, equiva­
[53,54] and further increase the competitiveness of green ammonia with lent to coal-based production cost at coal prices over 200 USD/tcoal
fossil-based ammonia. (equivalent to crude oil prices over 170 USD/bbl). However, if a 28
€/tCO2 GHG emissions cost be applied, the cost of coal-based ammonia
3.4.2. Coal-based ammonia increases by 126 €/tNH3 and consequently the fuel parity would decrease
The required energy for the best coal-based ammonia technology is to crude coal prices of 85–180 €/tcoal (~75–175 USD/bbl). For some
about 48 GJLHV/tNH3 or 1.7 times the energy demand of NG-based Chinese electrolyser manufacturers, it is reported to have a capex of 200
ammonia [2], which is about 10% lower than the upper limit defined USD/kWel, significantly lower than from the leading Western manu­
by China’s recent regulations for new coal-based ammonia plants [55]. facturers [64]. In an optimistic scenario, assuming a system-level capex
Assuming bituminous coal with a heating value of 30.5 MJ/kg and a half of the value in global scenario for low-cost Chinese electrolysers
carbon emission factor of 25.8 tC/TJ [56], coal-based ammonia would (~342.5 €/kWH2,HHV or 300 USD/kWel) for the same efficiency and
have direct CO2 emissions of 4.5 tCO2/tNH3, excluding other hazardous durability as internationally leading manufacturers, the cost of RE-based
emissions. Thus, the CO2 emissions and respective GHG emissions cost of ammonia could decrease by 100–200 €/tNH3 to 480–550 €/tNH3 in least-
coal-based ammonia are 2.9 times of NG-based ammonia. cost regions in 2020 (Fig. 18). However, even if such assumptions could
The investment cost of coal-based ammonia is reported to be 2.4 be realised, RE-based ammonia would be more expensive than coal-
times [4], 2.5 times [57], 2–3 times [2] or more than twice [58] as high based ammonia cost of 320–340 €/t in China [61]. By 2030, enforcing
as NG-based ammonia. In this study, a 2.4 times capex ratio (equal to even small CO2 emissions cost as low as 20 €/tCO2 on the fossil-based
2235 €/tNH3⋅a) is assumed for new coal-based ammonia plants, in the ammonia industry in China by policy-makers would significantly in­
light of recent tighter environmental regulations. crease the cost of coal-based ammonia by 90 €/tCO2 and would make
The cost of coal-based ammonia is a function of coal price and green ammonia competitive with current coal-based ammonia cost of
respective CO2 emissions cost. China’s Qinhuangdao coal import spot 320–340 €/t. The monetisation of the by-product heat from RE-based
price has been historically following the global crude oil market prices ammonia plants could be the other option to close the gap. By 2040,
[59]. However, since China’s coal demand is mainly domestically sup­ green ammonia would be fully cost competitive with coal-based
plied [60], its coal price may follow a different pattern. Nevertheless, ammonia at large scale in many regions even without consideration of
due to lack of information, it is assumed that domestic coal prices in any GHG emissions cost. Thus, at no additional cost, a shift to green
China are comparable to the Qinhuangdao coal spot price. For a NG to ammonia would decrease China’s coal consumption and respective GHG
OECD crude oil price ratio of 50%, the 2000–2017 average price ratio of emissions, while maintaining security of supply. In addition, if inte­
coal to NG would be 46% based on the energy content. Considering 70% grated with the power sector, flexible ammonia plants, electrolysers and
higher energy demand of coal-based ammonia, the cost of feedstock for hydrogen storage can provide additional flexibility to a power sector
coal-based ammonia would be still 78% of the feedstock cost of NG- with high shares of solar and wind electricity, which would be a great
based ammonia. added value of green ammonia plants to China’s energy system. More­
At a natural gas price of 5 USD/MMBtu (13.1 €/MWhth), a constant over, domestic green ammonia could be partly decoupled from the
coal to NG price ratio of 46% (67 USD/tcoal) and a WACC of 7%, the cost location of power supply via power lines. This would provide the pos­
of coal-based ammonia would be 400 €/tNH3, which is relatively higher sibility of installation of new ammonia plants at brown fields or close to
than the estimated cost of 380–410 USD/t (320–340 €/t) for coal-based ammonia consumption sites, which could further decline the cost of the
ammonia in China [61]. This could be partly because of lower domestic ammonia value chain. Since China has very good solar and wind re­
coal prices in China and the relatively higher capex assumption for new sources, the stated special circumstances could make China a global
plants, due to environmental regulations. If the capex ratio of coal-based leader in green ammonia production. Once implemented at a scale, the
ammonia to NG-based ammonia plants was set at 2, the production cost cost of modular NH3 synthesis units and electrolysers, as major con­
of ammonia would had been 54 €/tNH3 cheaper. Nevertheless, the cost tributors to the total cost, would significantly decline, which would
difference of coal-based and NG-based ammonia is significantly bigger further decline the cost of green ammonia globally and would also pave
than potential ammonia shipping cost of about 20–40 €/tNH3, as the path for a faster replacement of NG-based ammonia with green
explained in Section 3.5. Under such conditions, a shift to NG-based ammonia.
ammonia production or NG-based ammonia import may be expected.
However, several factors slow down such potential changes. NG has a

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Fig. 18. Industrial cost curves for Power-to-Ammonia in China, based on cost-optimised hybrid PV-wind power plants for the period 2020 to 2050 (left) and levelised
cost of Onsite green ammonia in 2030 (right, top) and 2050 (right, bottom).

Fig. 19. Coal-based vs. green ammonia cost for varying coal prices.

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3.5. Ammonia shipping and trading options China (33.7%) and Europe (21.5%) had the highest ammonia con­
sumption in the world in 2016, followed by South Asian Association for
As shown in Figs. 4 and 6, the capacity and regional distribution of Regional Cooperation (SAARC) (over 11.4%), North America (11.4%),
least-cost sites in 2020 and 2030 is limited, which encourage construction Middle East (8.3%) and Africa (3.5%) [69]. Fig. 21 illustrates the po­
of large-scale ammonia plants at the least-cost sites. Such plants benefit tential of ammonia production in 9 major regions. Among the major
from a relatively lower capex as well, as explained in Section 2.1. The low- ammonia consumers Europe, India, Middle East and Africa have Onsite
cost RE-based ammonia can then be transported to the consumption sites ammonia production cost of about 570–700 €/tNH3 in 2020, while a
by ship, pipeline, rail or truck [65]. Ammonia is usually shipped in LPG decade-average price (2007–2017) of ammonia in Belgium (as a Euro­
carriers in liquid state at –33 ◦ C and ambient pressure [66]. For a chosen pean country) and India has been about 300–350 €/tNH3 (Supplementary
vessel, the levelised cost of shipping is a function of annually transported Data, Fig. S1). A 28 €/t GHG emissions cost in 2020 would add about 44
ammonia which mainly depends on the shipping distance and speed as €/tNH3 to the cost of conventional ammonia, which is still not enough to
formulated in Eq. (8) and illustrated in Fig. 20. A generic fuel consump­ close the gap with the least cost sites. Nevertheless, a more realistic
tion of 0.0082 kWhth/DWT-km is considered for deep sea vessels ac­ WACC of 4% for the power sector in Europe could lower the cost of
cording to Horvath et al. [67]. DWT stands for deadweight tonnage that electricity supply for ammonia production. On the other hand, land use
the vessel can carry, of which 90% is considered to be the cargo weight conflict and competition with power sector in utilisation of electricity
[68]. The impact of fuel type on the ship capex and available space for from the best sites (mainly in Iceland, UK and coastal areas of Western
cargo is negligible, according to Horvath et al. [67]. In a conservative Europe) could limit Europe’s capacity for ammonia generation, yet
approach, the same fuel consumption level is assumed for the empty enough for introduction of RE-based ammonia at commercial scale to
vessel on its return trip. At 13,500 km, Patagonia to the Netherlands is a the European market. Such internal trade could also avoid relatively
relatively long international shipping route, which in return would have a higher shipping costs from other continents to Europe. By 2030, least-
shipping cost of about 43–59 €/tNH3 for a shipping fuel price of 20–80 cost regions are slightly above average market prices and could secure
€/MWhth. The 20 €/MWhth case represents low-cost diesel (at ~40 USD/ market parity if some level of CO2 emissions cost would be applied, or a
bblcrude oil), the 40 €/MWhth case represents high-cost diesel (at ~80 lower level of WACC would be possible or there would be some benefit
USD/bblcrude oil) or low-cost diesel with 75 €/ton GHG emissions cost or from by-product heat. Thus, by 2040 RE-based ammonia reaches market
low-cost RE-based ammonia as a shipping fuel in 2050, while the 80 parity with fossil-based ammonia in more regions. Beyond 2040, low-
€/MWhth case represents RE-based ammonia as a shipping fuel in 2020. A cost RE-based ammonia would be accessible globally and the differ­
combination of high-cost diesel and significant GHG emissions cost is ence of ammonia production cost at Onsite least-cost regions and world’s
unlikely as the demand for fossil fuels and consequently their price is Coastal least-cost would decrease to less than 40 €/tNH3, comparable to
expected to decline when significant GHG emission costs are applied. The the shipping cost for routes of about 10,000 km. Such cost distribution
shipping cost is independent from the cost of cargo ammonia, assuming could limit intercontinental ammonia shipping to shorter routes such as
no ammonia is lost in the shipping process. The chosen vessel for this Morocco-Europe, as discussed for the case of synthetic fuels by Fasihi
analysis was a mid-size LPG carrier. The use of larger ships can potentially et al. [70], and Australia-Japan, as discussed for the case of RE-based
reduce the shipping cost by economies of scale. liquefied natural gas by Gulagi et al. [71]. It would also encourage the
implementation of mid-scale local ammonia plants, which in contrary,

( )
ship capital cost∙ crf + opexfix fuelcons. ∙distance∙2∙fuelprice
Levelised cost of shipping = + (8)
365 days∙ship availability factor cargo share of DWT
ship capacity∙
2∙distance
+ unload & upload time
ship average speed

Ammonia shipping cost


80 8
annualised capex fixed opex
fuel cost at 20 €/MWhth fuel cost at 40 €/MWhth
70 fuel cost at 80 €/MWhth specific cost at 20 €/MWhth 7
specific cost at 40 €/MWhth specific cost at 80 €/MWhth
60 6
Specific cost [€/(tNH3-1000 km)]

50 5
Cost [€/tNH3]

40 4

30 3

20 2

10 1

0 0
1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

Distance [km]

Fig. 20. Ammonia shipping cost by distance.

16
M. Fasihi et al. Applied Energy 294 (2021) 116170

have a higher capex. Since ammonia energy demand is mainly in the intercontinental transportation due to their higher calorific density,
form of hydrogen provided by flexible water electrolysers, integration large scale plants for export, minimum shipping cost and available
with the local grid connection could also add additional flexibility to the infrastructure [49]. Nevertheless, ammonia trading between Australia
overall local energy system and reduce the costs. On the other hand, and Japan could still be a long-term option due land limitation in Japan,
liquid synthetic fuels such as diesel and kerosene are ideal for low-cost ammonia production in Australia (combination of good solar

Fig. 21. Industrial cost curves for ammonia Onsite (left) and Coastal (right) in the 9 major regions, based on cost-optimised hybrid PV-wind power plants for the
period 2020 to 2050.

17
M. Fasihi et al. Applied Energy 294 (2021) 116170

resources and low local WACC) and relatively lower sea distance be­ flexible synthesis units or low-cost hydrogen caverns.
tween the two countries. Recent research by Osman et al. [72] also Future research is needed on the cost of ammonia transportation via
concludes that fossil fuel exporters in the Middle East could become pipelines in different terrain conditions in comparison to electricity
green ammonia exporters in the future. transmission lines. In addition, high spatial resolution maps of suitable
sites for PV and wind power plants installation are required in order to
4. Conclusion differentiate between theoretical and technical potential of green
ammonia.
In this study, cost-optimised configuration of Onsite and Coastal
Power-to-Ammonia plants based on hourly power supply from hybrid CRediT authorship contribution statement
PV-wind power plants and balancing technologies is modelled. The
model evaluates the least-cost ammonia production cost and capacity in Mahdi Fasihi: Conceptualization, Data curation, Resources, Soft­
a 0.45◦ × 0.45◦ spatial resolution based on efficiency and cost pro­ ware, Validation, Visualization, Writing - original draft, Writing - review
jections for the years 2020, 2030, 2040 and 2050. & editing. Robert Weiss: Data curation. Jouni Savolainen: Data
The results show that up to 10 billion tons of Onsite RE-based curation. Christian Breyer: Conceptualization, Supervision, Writing -
ammonia can be generated annually at the best sites in the world for a review & editing, Funding acquisition.
cost range of 440–630, 345–420, 300–330 and 260–290 €/tNH3 in 2020,
2030, 2040 and 2050, respectively and for a WACC of 7%. For such Declaration of Competing Interest
generation costs, green ammonia production could be cost-competitive
in niche markets by 2030 and in higher volumes beyond 2030 with The authors declare that they have no known competing financial
drop in the cost of renewables and balancing technologies. Best sites for interests or personal relationships that could have appeared to influence
ammonia production in 2020 could have rather excellent solar and wind the work reported in this paper.
resources such as Patagonia and Atacama Desert or a low WACC for
investment such as Northwest European countries. Applying a GHG Acknowledgements
emissions cost could significantly change the time and scale of such cost-
competitiveness. For GHG emissions costs of 75 €/tCO2, RE-based The authors gratefully acknowledge the financial support of LUT
ammonia in 2040 would be cost-competitive with natural gas at prices University and the public funding of Business Finland for the ‘P2XEN­
as low as 2 USD/MMBtu. Thus, countries that apply GHG emission costs ABLE’ project under the number 8588/31/2019, which partly funded
or restriction on fossil fuels will become the first markets for green this research. The first author thanks the Gasum Gas Fund for the
ammonia until it becomes fully cost-competitive by 2040 regardless of valuable scholarship. We also thank Ashish Gulagi for proofreading.
the applied GHG emission cost.
Beyond 2040, the cost difference of least-cost Onsite ammonia pro­ Appendix A
duction at major regions is not more than the additional cost of Coastal
ammonia production and shipping cost which consequently could limit See Table A1.
intercontinental ammonia trading to regions with area limitation for
local green ammonia production.
The coal-based ammonia supply in China is a unique case. It is more
expensive than NG-based ammonia due to a capex intensive process and
would be more affected by a potential GHG emissions cost in the future due
to 2.9 times emissions per ton of ammonia. Moreover, fuel cost has a smaller
share in the total cost of coal-based ammonia. Thus, unlike NG-based
ammonia, coal-based ammonia cannot benefit much from lower coal pri­
ces to survive in a tightening market by higher GHG emissions costs or
cheaper green ammonia. The locally produced green ammonia in China is
expected to be cost-competitive with coal-based ammonia in 2030 for a
modest GHG emissions cost of 10–30 €/tCO2 and fully cost competitive in
2040 and beyond without any GHG emissions cost consideration. Low
natural gas resources, very good solar and wind resources, coal-based
pollution, as well as importance of locally produced ammonia (energy se­
curity, grid flexibility and by-product heat) could make China a leading
country for the advancement of green ammonia in the world.
Results show that in an islanded setup, PV is the dominating tech­
nology by 2030 in most parts of the world except for Patagonia and far
northern regions, due to the excellent wind resource availability. In
addition, gas turbines are not expected to have a significant role in the
cost-optimised system and batteries are mainly installed for balancing
the direct electricity requirement of the ammonia plant rather than
increasing the utilisation rate of electrolysers. Such a system design
mainly relies on flexibility of electrolysers and availability of semi-

18
M. Fasihi et al. Applied Energy 294 (2021) 116170

Table A1
Technical and financial specifications.
Device Unit 2020 2030 2040 2050 Ref.

PV fixed tilted capex €/kWp 580 390 300 246 [25]


€/kWp 432 278 207 166 [26]
€/kWp 475 306 207 166 this study
opex fix €/(kWp⋅a) 13.2 10.6 8.8 7.4 [25]
€/(kWp⋅a) 7.76 5.66 4.47 3.70 [26]
€/(kWp⋅a) 8.53 6.23 4.47 3.70 this study
lifetime year 30 35 40 40 [51]

PV single-axis tracking capex €/kWp 638 429 330 271 [25,73]


€/kWp 475 306 228 183 [26,73]
€/kWp 523 337 228 183 this study
opex fix €/(kWp⋅a) 15 12 10 8 [25,73]
€/(kWp⋅a) 8.54 6.23 4.92 4.07 [26,73]
€/(kWp⋅a) 9.40 6.86 4.92 4.07 this study
lifetime year 30 35 40 40

Wind energy (onshore) capex €/kWp 1150 1000 940 900 [51,74]
opex fix % of capex p.a. 2 2 2 2
lifetime year 25 25 25 25
wake effect % 7 7 7 7

Battery storage capex €/kWh 234 110 76 61 [26]


opex fix €/(kWh⋅a) 3.28 2.20 1.90 1.71
opex var €/kWh 0.0002 0.0002 0.0002 0.0002
lifetime year 20 20 20 20 [74]
cycle eff. % 91 93 95 95 [75]
self-discharge %/h 0 0 0 0

Battery interface capex €/kW 117 55 37 30 [26]


opex fix €/(kW⋅a) 1.64 1.1 0.93 0.84
opex var €/kWh 0 0 0 0
lifetime year 20 20 20 20 [74]

Combined cycle gas turbine capex (conventional) €/kW 775 775 775 775 [76]
capex (H2-fuelld) €/kW 853 853 853 853 10% higher capex
opex fix % of capex p.a. 2.5 2.5 2.5 2.5 [76]
opex var €/kWh 0.002 0.002 0.002 0.002 [76]
lifetime year 35 35 35 35 [77]
eff. (LHV) % – 58 60 60 [76,78]
eff. (HHV) % – 52.2 54 54

Open cycle gas turbine capex (conventional) €/kW 475 475 475 475 [76]
capex (H2-fuelld) €/kW 523 523 523 523 10% higher capex
opex fix % of capex p.a. 3 3 3 3 [76]
opex var €/kWh 0.011 0.011 0.011 0.011 [76]
lifetime year 35 35 35 35 [77]
eff. (LHV) % – 43 44 45
eff. (HHV) % – 38.7 39.6 40.5 [76]

1 1 2 2
HVDC (underground cable) capex €/(kW⋅km) 1.2333 1.2333 1.3667 1.3667 [79]
opex fix % of capex p.a. 0.1 0.1 0.1 0.1 [79]
lifetime year 50 50 50 50 [80]
efficiency % per 1000 km 96.4 1 96.4 1 98.4 2 98.4 2 [79]

HVDC (overhead line) capex €/(kW⋅km) 0.20 1 0.20 1 0.30 2 0.30 2 [79]
opex fix % of capex p.a. 1 1 1 1 [79]
lifetime year 50 50 50 50 [80]
efficiency % per 1000 km 93.4 1 93.4 1 98.4 2 98.4 2 [79]

HVDC (Blended) capex €/(kW⋅km) 0.303 0.303 0.407 0.407 this study:
opex fix €/(kW⋅km⋅a) 0.0019 0.0019 0.0028 0.0028 10% underground
lifetime year 50 50 50 50 90% overhead
efficiency % per 1000 km 93.7 93.7 98.4 98.4

HVAC (overhead line) capex €/(kW⋅km) 0.244 0.244 0.244 0.244 [79]
opex fix % of capex p.a. 1 1 1 1 [79]
lifetime year 50 50 50 50 [80]
efficiency % per 1000 km 86 86 86 86 [79]

Converter station capex €/kW 150 1 150 1 180 2 180 2 [79]


opex fix % of capex p.a. 1 1 1 1
lifetime year 50 50 50 50
efficiency % 98.6 98.6 98.6 98.6

(continued on next page)

19
M. Fasihi et al. Applied Energy 294 (2021) 116170

Table A1 (continued )
Device Unit 2020 2030 2040 2050 Ref.

Alkaline water electrolyser capex €/kWH2,HHV 685 380 296 248 [36,81,82]
(30 bar outlet) opex fix % of capex p.a. 3.5 3.5 3.5 3.5
opex var €/kWhH2 0.0036 0.0018 0.0013 0.0010
lifetime year 30 30 30 30
eff. (HHV) % 73.3 76.2 79.2 82.1

H2 compressor capex (6 MWH2) €/kWH2,LHV 100 100 100 100 [38]


capex (150 MWH2) €/kWH2,HHV 29 29 29 29 this study4
opex fix % of capex p.a. 4 4 4 4 [38]
lifetime year 20 20 20 20
pressure range bar 30–200 30–200 30–200 30–200 [39]
el. consumption kWhel/kWhH2,HHV 0.040 3 0.040 3 0.04 3 0.040 3 [38,39]

Salt cavern H2 storage capex €/MWhH2,HHV 386 374 370 367 [83]
(~4000 tH2, net) opex fix % of capex p.a. 4 4 4 4 [39]
opex var €/kWhH2 0.0002 0.0002 0.0002 0.0002
lifetime year 30 30 30 30 [39]
cycle eff. % 100 100 100 100
max charge/discharge %/day 8 8 8 8 [40]
pressure range bar 60–200 60–200 60–200 60–200 [39]

Lined rock cavern H2 storage capex €/MWhH2,HHV 1120 1120 1120 1120 [83]
(~500 tH2, net) opex fix % of capex p.a. 4 4 4 4
opex var €/kWhH2 0.0001 0.0001 0.0001 0.0001
lifetime year 30 30 30 30
cycle eff. % 100 100 100 100
max charge/discharge %/day 8 8 8 8
pressure range bar 20–200 20–200 20–200 20–200

Underground pipeline H2 capex €/MWhH2,HHV 10,860 10,860 10,860 10,860 based on [83]
storage
(~800 tH2, net) opex fix % of capex p.a. 2 2 2 2
opex var €/kWhH2 0.0001 0.0001 0.0001 0.0001
lifetime year 30 30 30 30
cycle eff. % 100 100 100 100
max charge/discharge %/h 16.7 16.7 16.7 16.7
pressure range bar 20–200 20–200 20–200 20–200

5
Ammonia Synthesis Unit capex (400 kt/a) €/tNH3.a 631 631 631 631 based on [18]
capex (1 Mt/a) €/tNH3.a 600 600 600 600
opex fix % of capex p.a. 5 5 5 5
lifetime year 30 30 30 30
electricity demand kWh/tNH3 738 738 738 738
H2 demand kg/tNH3 830.7 830.7 830.7 830.7
N2 demand kg/tNH3 179.4 179.4 179.4 179.4
H2 & N2 conversion rate % 99 99 99 99
operating pressure bar 150 150 150 150
availability h 8000 8000 8000 8000

Ammonia storage capex €/tNH3 623 623 623 623 based on [18]
(~33 ktNH3) opex fix % of capex p.a. 4 4 4 4
opex var €/tNH3 0.001 0.001 0.001 0.001
lifetime year 30 30 30 30
cycle eff. % 100 100 100 100
max charge/discharge %/h 4.2 4.2 4.2 4.2

Liquid ammonia carrier capacity m3 20,600 20,600 20,600 20,600 [84]


capex m€/unit 39.2 6 39.2 6 39.2 6 39.2 6 [84]
opex fix % of capex p.a. 3.5 3.5 3.5 3.5
fuel consumption kWhth/DWT-km 0.0082 0.0082 0.0082 0.0082 [67]
lifetime year 25 25 25 25
availability % 95 95 95 95
cargo share of DWT % 90 90 90 90
service speed knots 16 16 16 16 [85]
loading & unloading time days 2 2 2 2
(continued on next page)

20
M. Fasihi et al. Applied Energy 294 (2021) 116170

Table A1 (continued )
Device Unit 2020 2030 2040 2050 Ref.

Steam Methane Reformer capex €/kWH2,LHV 375 7 375 375 375 [86]
opex fix % of capex p.a. 5 5 5 5
eff. (LHV) % 75.5 75.5 75.5 75.5 [86]
lifetime year 30 30 30 30 [86]
availability h 8000 8000 8000 8000

8
Steam turbine capex €/kW 500 [87]
opex fix % of capex p.a. 2
opex var €/kWh 0
lifetime year 25
(1)
500 kV.
(2)
800 kV.
(3)
Adiabatic. 75% of electricity consumption for full range compression (0.053 kWhel/kWhH2,HHV).
(4)
Based on a scaling factor of 0.67 applied on the original capex of 100 €/kWH2,LHV for a 6 MWH2,LHV unit.
(5)
Large scale plant (400 ktNH3/a), including air separation unit, N2 & H2 compressor, N2 buffer and 30 days NH3 storage.
(6)
Original value: 51 mUSD.
(7)
Original value: 400–600 USD/kWH2,LHV.
(8)
Excluding boiler.

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