In a new paper published in Energy and Environmental Science, MIT Energy Initiative (MITEI) researchers have quantified how different pathways for decarbonising ammonia – and trading it globally – compared in terms of cost and emissions. The study examined potential ammonia flows across 63 countries, combining economic, technological and environmental data into what the researchers describe as the largest harmonised dataset of its kind. ‘The results should help researchers, policymakers, and industry stakeholders calculate the cost and lifecycle emissions of different ammonia production technologies and trade routes,’ said the paper’s authors.

The researchers assessed six ammonia production pathways, spanning conventional ‘grey’ ammonia, ‘blue’ ammonia produced from fossil fuels with carbon capture and storage (CCS), and ‘green’ ammonia produced using renewable or nuclear electricity. Their analysis accounted for the full lifecycle of ammonia, including feedstock extraction, production, storage, transport and international shipping.

Ammonia has the potential to play an important role in the energy transition. Carbon-free at the point of use, energy-dense, and easier and cheaper to store and transport than hydrogen, it can act both as a direct fuel for power generation, shipping and industry, and as a carrier for hydrogen. It also has the advantage of already having a global production and shipping infrastructure, built largely to serve fertiliser markets, according to the MIT study.

However, it also notes that today’s ammonia production is highly carbon-intensive. The dominant Haber-Bosch process (which converts atmospheric nitrogen and hydrogen under high pressure and temperature using a metal catalyst, usually iron) relies on hydrogen derived mainly from natural gas to produce so-called ‘grey’ ammonia. According to the Royal Society, the process accounted for around 1.8% of global greenhouse gas (GHG) emissions in 2020.

One headline finding of the study is the scale of emissions reductions available – and their associated costs. A full transition to blue ammonia produced via conventional processes paired with CCS could reduce global GHG emissions by nearly 71%, at an average cost increase of 23.2%, according to the scientists. A transition to electrolysed green ammonia produced using renewable electricity could cut emissions by 99.7%, but at a higher cost premium of around 46%.

‘Before this, there were no harmonised datasets quantifying the impacts of this transition,’ commented lead author Woojae Shin. ‘Everyone is talking about ammonia as a super important hydrogen carrier in the future, but the data were fragmented. This fills a major knowledge gap.’

In the US context, the study found that conventional steam methane reforming (SMR) without CCS remains the cheapest option, at around 48 US cents per kg of ammonia – but also the most emissions-intensive, at 2.46 kgCO₂ equivalent per kg. Adding CCS to SMR cuts emissions by around 61%, but increases costs by roughly 29%.

More cost-effective decarbonisation options emerged using auto-thermal reforming (ATR). ATR with air combustion and CCS delivers emissions of 0.75 kgCO₂e per kg of ammonia produced at only a 10% cost increase relative to grey ammonia. Among blue ammonia routes, oxygen-fired ATR with CCS achieves the lowest emissions, at a production cost of about 57 cents per kg.

Electricity-based production pathways were found to be generally more expensive than blue ammonia, although emissions vary widely depending on the power source. Nuclear-powered ammonia production delivers near-zero emissions – just 0.03 kgCO₂e per kg of ammonia produced – highlighting the importance of clean electricity supply.

Across the 63 countries modelled, energy prices, grid carbon intensity and financing conditions prove decisive. Countries with abundant low-cost natural gas are best positioned for blue ammonia, while China emerges as a potential competitive exporter of green ammonia due to its renewable build-out and manufacturing scale, according to the authors. The Middle East also shows strong potential for low-carbon ammonia production.

‘Ammonia researchers, producers, as well as government officials require this data to understand the impact of different technologies and global supply corridors,’ Shin said. ‘Governments can use this to compare options and set future policies. Any country producing ammonia needs to know which countries they can deliver to economically,’ added paper co-author Guiyan Zang.

Europe to tap into Indian green ammonia supply

Highlighting how the cost and emissions trade-offs of global ammonia production and trade are shaping real-world ammonia supply chains, German energy company Uniper Global Commodities has signed a long-term binding offtake agreement with AM Green Ammonia of India for the supply of 500,000 t/y of hydrogen certified as a renewable fuel of non-biological origin (RFNBO).  

The deal underpins what the companies describe as one of the first large-scale green ammonia supply corridors between India and Europe. Initial deliveries are expected from 2028, sourced from AM Green’s first production facility in Kakinada, Andhra Pradesh, which is currently under construction and designed to produce up to 1mn t/y of green ammonia.

‘Green ammonia stands out as one of the most promising solutions to decarbonise CO₂-intensive production of chemicals and fertilisers,’ said Anil Chalamalasetty, Founder of Greenko Group and AM Green. ‘It offers among the lowest CO₂ avoidance costs compared to other renewable and low-carbon molecules, thanks to its mature production process and the absence of carbon feedstock requirements.’

Mahesh Kolli, Co-founder of AM Green, added that aligning supply, certification and demand-side incentives is key. ‘This landmark agreement shows that we can bring competitive renewable molecules to European industry at scale, delivering real emission reductions.’