U.S.-based ammonia producer CF Industries Holdings has signed a Memorandum of Understanding (MoU) with Japanese power generator JERA to supply up to 500,000 metric tons per year of clean ammonia beginning in 2027.
The clean ammonia will be produced with at least 60% lower carbon emissions than conventionally produced ammonia, CF Industries says. It will be co-fired with coal at to cut CO2 emissions from the facility as ammonia does not emit CO2 when combusted.
JERA has already completed an ammonia co-firing pilot test and is set to begin a demonstration project at the Hekinan power plant during its fiscal year 2023.
“We look forward to helping JERA and Japan meet its clean ammonia requirements, which represent the first significant volume of what we believe will be substantial global demand for clean ammonia as a clean energy source,” Tony Will, President and Chief Executive Officer of CF Industries Holdings, said in a statement.
Ammonia has been commercially produced for more than 100 years, used in the fertilizer and household products sectors. It can be created from hydrogen and nitrogen via processing of natural gas.
Some recent considerations for ammonia use includes adapting it as an energy carrier along with hydrogen.
Under the MoU, the two companies expect to assess a range of potential supply options, such as a supplementary long-term offtake agreement from CF Industries’ Donaldsonville Complex in Louisiana and an equity investment alongside CF Industries to build a greenfield clean ammonia facility in Louisiana.
“JERA will continue its own efforts as well as to take hands with our partners in pursuit of our endeavor to realize and accelerate not only the decarbonization of the Japanese energy industry but also to solve the energy-related issues that the world is facing,” JERA Corporate Vice President Yukio Kani said in a statement.
CF Industries has been working on projects to decarbonize its ammonia production network and supply clean ammonia in the near future. This includes using carbon capture and sequestration (CCS) at its Donaldsonville Complex to capture and permanently store up to 2 million tons of CO2 per year, set to start in 2025.
The company is also studying the construction of a new facility using CCS in Ascension Parish, Louisiana. Additionally, it is building North America’s first commercial scale green ammonia capacity at the Donaldsonville Complex, with a production capacity of 20,000 tons starting in 2024.
JERA is a joint venture between Japanese electric power companies TEPCO Fuel & Power and Chubu Electric Power, and produces about 30% of all electricity in Japan.