By Jin Ding CCS Wuhan Rules & Research Institute

Among the available green fuels, methanol and green ammonia are considered the two main stream alternative fuels for achieving net zero emissions in international shipping by virtue of their good supply and economic expectations. So, what are the corresponding requirements for the use of ammonia fuel in ships at present? Is the green ammonia preparation technology mature, and what are its future development prospects?

Green Fuel Standards and Certification

China Classification Society (CCS) released the "Guidelines for Ships Using Ammonia Fuel" in 2022. In addition, major classification societies around the world have also introduced the rules for ammonia-fueled vessels.

After three years, the International Maritime Organization (IMO) finalized the "Interim Safety Guidelines for Ships Using Ammonia Fuel" (draft) in 2024, which is expected to be officially adopted in December 2024. The design and construction of ammonia-fueled vessels will usher in recognized international regulations. For ammonia carriers that use cargoes as fuels, IMO has also revised the IGC rules to allow some toxic cargoes to be used as ship fuels. Relevant technical requirements are being formulated, and soon the problem of shortage of rules will also be solved for ammonia carriers that use cargoes as fuels.

The European Union has proposed regional green fuel standards in the Renewable Energy Directive, which categorize green fuels into three types: Renewable fuels of non-biological origin (RFNBO), Recycled carbon fuels (RCF), and biomass fuels. These standards are applicable to shipping green ammonia fuels and set requirements for green fuels in terms of carbon source, hydrogen source, energy source, emission intensity, sustainability, etc.

In addition to meeting the requirements of green fuel standards, the fuels produced must also be certified as green fuel by qualified institutions in accordance with the certification system recognized by the European Commission that meets the requirements of the Renewable Energy Directive before it can be considered green fuel. Currently, there are many certification systems or mechanisms that comply with the requirements of the EU Renewable Energy Directive, among which ISCC (International Sustainability & Carbon Certification) EU is one of the most widely used. ISCC EU is one of the categories of the ISCC certification system, which proposes basic requirements for sustainable/green fuels from three aspects of sustainability requirements, traceability and regulatory chain, and greenhouse gas emissions.

Green Ammonia Preparation

Unlike carbon-containing fuels such as methanol that has two ways of preparation: biomass preparation and electrosynthesis, ammonia, as a zero carbon fuel, currently has only one feasible preparation method, that is electrosynthesis. Traditional fossil-synthesized ammonia is prepared by the Haber-Bosch Process, which catalyzes nitrogen and hydrogen to produce ammonia under high temperature and pressure conditions. During the process, the high-temperature and high-pressure environment is provided by fossil fuels, resulting in a high greenhouse gas emission intensity throughout the entire lifecycle of the final product. Green ammonia is produced by electrolyzing water with renewable energy sources, and the energy required for the reaction is provided by renewable energy sources. Compared with the traditional preparation methods, changing the energy source can achieve the preparation of green ammonia. The preparation technology of ammonia is extremely mature, and the technological breakthroughs will mainly be made in reducing reaction conditions and improving reaction yields in the future, but the preparation method will not undergo significant changes.

In terms of the compliance of green fuels, two factors are mainly considered: sustainability and emission intensity.

1.   For green ammonia, its molecular formula does not contain carbon and it is generally not prepared by biomass process. There is currently no disagreement on the sustainability of its hydrogen and nitrogen sources. Therefore, whether the ammonia produced can be certified as green ammonia mainly depends on its greenhouse gas emissions throughout its entire lifecycle.

2.   In the EU Renewable Energy Directive, the full lifecycle greenhouse gas emission intensity is 28.2CO2eq/MJ (70% lower than fossil fuels) for RFMBO and RCF. According to the calculation results of US Greet software, if renewable energy is used for power supply, the full lifecycle greenhouse gas emission intensity of ammonia is 2.13gCO2eq/MJ; if coal-fired boiler is used for energy supply, the full lifecycle greenhouse gas emission intensity of ammonia is 17.08 gCO2eq/MJ. Whether energy supply is provided by renewable energy or coal-fired boilers, the full lifecycle greenhouse gas emission intensity of electro-synthetic ammonia can meet the requirement of reduction by 70%. Considering that some of the built-in energy consumption and production efficiency parameters in Greet software are set based on the technological level of the United States, for domestically-produced green ammonia, under the same preparation method, its full lifecycle emission intensity is usually higher than the calculated value of the software, which may exceed 28.2CO2eq/MJ.

Comprehensive Adaptability Analysis

To assess the comprehensive adaptability of ship fuels, key factors such as emission reduction contribution, technology maturity, fuel availability, economy, etc should be considered.

1.   Contribution to Emission Reduction

From the perspective of ship side, as ammonia is a zero-carbon fuel, carbon emissions will not be produced after its complete combustion. However, the net zero emissions of the shipping industry focus on the full lifecycle, and although ammonia does not contain carbon, carbon emissions are generated during its production (upstream) and transportation (midstream) process. But if renewable energy is used to synthesize green hydrogen and nitrogen to produce green ammonia, significant emissions reduction can be achieved to fully meet the requirements of international regulations for green fuels.

2.   Technology Maturity

Technically speaking, the storage, transportation, and supply of ammonia are relatively mature, but currently the biggest problem is internal combustion engines running on ammonia fuel. Based on the current situation, ammonia internal combustion engines are still at the initial stage of development, with both MAN ES and W？rtsil？ carrying out R&D. Mainstream domestic engine manufacturers have also developed the R&D plans. After nearly 3 years, significant progress has been made in the R&D of internal combustion engines using ammonia fuel, especially in the R&D of low-speed two-stroke and medium-speed four-stroke ammonia engines. Commercial ammonia engine products will be put into the market by the end of this year or early next year, and there will be more types of marine ammonia engines in the future.

3.   Fuel Availability

As for ammonia fuel, the availability of green ammonia is a major concern for the shipping industry. According to statistics from the International Renewable Energy Agency (IRENA), as of November 2023, the global planned production capacity of green ammonia has exceeded 70 million tons, which is mainly distributed in Australia, the Middle East, Africa, etc. Currently, there is no green ammonia production in China. According to statistics from China Classification Society (CCS), the planned production capacity of green ammonia in China is about 9.5 million tons, which has begun to take shape and is still growing rapidly. With the increasingly strict emissions reduction regulations and the rapid increase in carbon costs, the green ammonia industry is expected to experience rapid development.

4.   Economy

Currently, the production cost of green ammonia is significantly higher than that of gray ammonia produced from fossil fuels, but with the continuous development of renewable energy electricity, it is expected that the cost of green hydrogen production will also decrease, and the price of green ammonia will continue to decline. According to the International Renewable Energy Agency (IRENA), the current global cost of producing green ammonia through renewable resources is about $700 to $1,300 per ton. It is expected that by 2030, the minimum cost of producing green ammonia will decrease to $450-$900. In addition to this data, CCS has also calculated the upper and lower limits of domestic green ammonia prices based on the composition structure of gray ammonia price, combined with energy consumption, cost and other information obtained from research on domestic fuel production and transportation enterprises and bunkering ports. After calculation, the domestic green ammonia prices are within the range of IRENA's prediction results.

For the marine economy of green ammonia, CCS has made acceptable price predictions for green ammonia at different time points. The acceptable price of fuel refers to the equal economic efficiency of ships using green ammonia fuel and traditional fuel at that price (consider paying IMO greenhouse gas emissions tax and fuel intensity penalty for fuel). According to the calculation results, after 2035, the economy of ships using green ammonia will begin to be equivalent to that of ships using fuel oil. After 2045, ships using green ammonia will generally be more economical than ships using fuel oil.

Future Outlook

Overall, the current global and domestic production of green ammonia is still in its early stages of development, with planned production capacity already taking shape but actual production capacity being limited. The production cost is also much higher than that of gray ammonia produced from fossil fuels, and it does not yet have the economical efficiency for marine use. In view of the progress in production technology and the decrease in renewable energy electricity costs, it is expected that the cost of green ammonia in China will continue to decline in the future. It is expected that after 2035, the economical efficiency of ships using green ammonia will begin to be equivalent or close to that of ships using fuel oil. After 2045, it will be more economical to use green ammonia than using fuel oil for ships.