Ammonia trumps hydrogen on cost as power source [Gas in Transition]
A new study by General Electric (GE) and Japanese industrial group IHI concludes that it will be cheaper in the future to use ammonia as a low-carbon fuel option in power generation than hydrogen, primarily due to the transport cost, GE’s emergent technologies director, Jeffrey Goldmeer, says in an interview with NGW.
The research, undertaken over the past year, weighs up various options for low-carbon electricity generation in 2030, using as a case study Japan, which has already trialled the import of ammonia from the Middle East as a source of power supply. Japan is already looking at developing supply chains for both ammonia and hydrogen, as part of its push to reach full decarbonisation by 2050.
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The study considers as one option the liquefaction of low-carbon hydrogen, and its subsequent shipment to Japan, where it would be regasified and then combusted at a power plant. Another option would be to combine the hydrogen with nitrogen to produce ammonia, for transport to Japan. There it could either be converted back into hydrogen for combustion, or combusted in ammonia form.
Additionally, the study compares these options with the cost of existing LNG supply to a power plant, adding in the expense of carbon capture utilisation or storage (CCUS) to eliminate the resulting emissions.
GE and IHI calculated the landed cost of each fuel option and the power generation cost to come up with levelised cost of electricity The fuel cost is the largest component of the overall electricity cost, Goldmeer notes, accounting for anywhere between 50 and 80%, depending on what assumptions are made.
“What we found is that if you had to choose between ammonia, ammonia cracked back to hydrogen or hydrogen, ammonia is going to give you the lowest cost of electricity,” Goldmeer explains.
The deciding factor is the transportation cost, he continues. The cost of liquefying hydrogen versus the cost of converting hydrogen into ammonia is roughly the same. But while ammonia condenses into a liquid ready for seaborne transport at only -30 °C, liquefied hydrogen must be kept at a temperature of -250 °C.
Furthermore, while ammonia transportation is a mature technology already, with 15-18mn mt of the commodity shipped annually around the world today, shipping hydrogen is only now undergoing trials. The world’s first hydrogen tanker loaded its first test cargo only in January last year in Australia, bound for Japan.
“Hydrogen shipping is a very nascent industry. It’s very cost intensive to liquefy hydrogen and ship it, and you also have to worry about boil-off and other challenges when you’re transporting a liquid that you’ve got to maintain at -250 °C,” Goldmeer says. “It’s the transport cost that really differentiates it from ammonia.”
Through the process of studying the supply or value chains for hydrogen and ammonia, GE and IHI learned that the cost for shipping and storing ammonia is somewhere between a quarter to a third of the cost of shipping and storing liquid hydrogen, and that this difference feeds into the differences in the levelized cost of electricity. Even using the assumptions that result in the highest cost of ammonia and the lowest cost of hydrogen, the resulting power is $10/mn Btu cheaper when ammonia is combusted, according to the study.
The study assumes that blue rather than green ammonia and hydrogen will dominate the low-carbon fuel mix in 2030, as production of the green varieties will not have reached sufficient scale by that point. Goldmeer notes that as hydrogen is the starting point for each fuel pathway, a switch to green hydrogen would increase the base costs and therefore the landed costs for all fuel options by the same amount. Notably the research is only economic in nature, and does not consider the emissions footprint of the different options. This, he says, should be the focus for a future study.
Further expanding their cooperation, GE and IHI signed a memorandum of understanding in January on further defining a roadmap to develop gas turbine technologies capable of operating on 100% ammonia. This would involve creating a 100% ammonia-capable combustion system that can be retrofitted to GE’s 6F.03, 7F and 9F turbines.
GE is undertaking similar research on 100% hydrogen turbines, having secured funding last year from the US Department of Energy to support this. It is also working on a project with Shell to retrofit turbines at LNG facilities to run on hydrogen. It has additional initiatives in the fields of carbon capture and the use of biofuels for power generation.