Feeding Life 2030: the vision of Fertilizers Europe

Click to visit. Feeding Life 2030, Fertilizers Europe, November 2018
Fertilizers Europe published an important report in late 2018 that examines key drivers for the fertilizer industry and describes the “likely developments expected between now and 2030.”

These developments include producing “perhaps 10%” of European ammonia from renewable electricity by using electrolyzers to generate renewable hydrogen feedstock. This would require scaling up green ammonia production capacity to more than a million tons per year, within ten years.

The report, Feeding Life 2030, also describes the policy framework required “to sustain the Vision.” In this vision, ammonia sits at “the crossroads of nutrition and energy” and is recognized as “the ‘missing link’ in the coming energy transformation.”

This Vision illustrates our industry’s forward-looking approach in addressing societal challenges. It aims to facilitate dialogue with key stakeholders on the future role of our industry … and to maintain a strong industrial base while moving towards a decarbonised society …

Europe is forging ahead with the transition to clean energy, and is relying increasingly on renewable energy sources. We are a part of this drive. The nitrogen fertilizers industry as a producer of ammonia offers the key to unlocking clean energy potential by acting as a carbon-free energy storage medium.
Javier Goñi del Cacho, CEO of Fertiberia and President of Fertilizers Europe, Introduction to Feeding Life 2030, Fertilizers Europe, November 2018

The report explores this “clean energy potential” in great detail:

As the EU progresses towards decarbonising its energy supply and relying more on renewable energy, such as wind and solar power and the production of hydrogen, the question of hydrogen storage becomes more pressing. Ammonia is made from hydrogen and air, and since ammonia has such high energy content and is easy to transport, it has huge potential as a mean to store hydrogen i.e. clean energy. It is the ‘missing link’ in making decarbonisation work.
Feeding Life 2030, Fertilizers Europe, November 2018

Fertilizer Use in 2030
Feeding Life 2030 begins by looking at how fertilizer use will evolve in the coming decade, and identifies three strands of innovation:

  • Supporting the professional farmer of the future,” with more efficient fertilizer products and the new tools and technologies needed to use them. The farmer of the future is envisioned as a more corporate being: better-educated, running larger operations with higher turnovers, and outsourcing more, including to “specialised contractors … applying crop nutrients.”
  • Applying more knowledge per hectare,” which equates to higher returns on investment, either by optimizing fertilizer applications to meet precise crop requirements, or by specializing towards high-value crops, “leaving other parts of the world to produce more ‘bulk commodities’.”
  • Getting ahead of regulatory pressures,” due to expanding adoption of rules governing nutrient accounting and nutrient balance, at the individual farm level.

Rules concerning clean air and especially ammonia emissions will become very important for the application of manure and mineral fertilizers in 2030 … Fertilizers with high ammonia emissions, such as urea-based fertilizers, will have to be applied under special conditions or have inhibitors added that reduce the potential for ammonia emissions …

Fertilizer production itself will also face increased regulatory pressure. New rules will limit emissions from production facilities and control wastes and by-products from fertilizer production sites. Producers will focus even more on sustainable techniques and inputs, including raw materials.
Feeding Life 2030, Fertilizers Europe, November 2018

Fertilizer Production in 2030
Feeding Life 2030 views the future of fertilizer production through three prisms:

  • Making decarbonisation of energy possible,” because in the EU, decarbonization will be achieved through adoption of hydrogen, and ammonia is an “easier, safer, and cheaper way to store and transport hydrogen than hydrogen itself.”
  • Promoting the circular economy,” through efficiency, synergies with other industry, and by using byproducts to displace raw material demand. [This is a limited, perhaps opportunistic view of the circular economy; the ‘circular economy’ requires industry systematically to ‘close the loop’ between production and waste.]
  • Strengthening product development,” because once the technology exists to “quantify and capture the value of premium fertilizers … the incentive for producers to increase research and development will become greater.”

Regarding ammonia’s role in the decarbonization of the energy sector:

By 2030 ammonia production units will be changing and will receive part, perhaps 10%, of their need for hydrogen from electrolysis based on electricity from renewable sources. Some ammonia units will have extra storage capacity, and this capacity will be used to level out production of renewable energy. There will be smaller units converting stored ammonia back to energy if needed locally. In short, ammonia production units of the future are likely to be flexible, able to use different sources of hydrogen, and to function as energy storage units and back-up energy producers.
Feeding Life 2030, Fertilizers Europe, November 2018

Fertilizer Production in 2050
Fertilizers Europe goes further, and speculates about ammonia production in 2050:

If the European Commission sets an objective of net zero emissions economy, across all sectors, in 2050, this would be a huge challenge for the mineral fertilizer industry … the good news is that with the technologies we know today such a future is realistic and possible.

In 2050 ammonia, which is the raw material for nitrogen fertilizer production, could be made from ‘green’ hydrogen derived from the electrolysis of water, powered by renewably-produced (green) electricity. This hydrogen will be produced at the most convenient sites where solar, wind or other forms of green energy are abundantly available. Ammonia can and will be produced near those sites, since ammonia is the most effective hydrogen storage available. But ammonia will also be produced at existing ammonia producing sites, connected to the hydrogen network via the former natural gas pipeline grid.

Since ammonia in this case will be used predominantly for energy storage and, furthermore, as it is the most likely replacement for Liquefied Natural Gas and Liquefied Petroleum Gas in the energy transport market, the production of ammonia for fertilizer use will form a smaller proportion of global ammonia consumption than today.

… However, such a situation is conditional on an abundant amount of carbon-free and competitively priced electricity being available, and the expansion of networks for the transportation of ammonia/hydrogen.
Feeding Life 2030, Fertilizers Europe, November 2018

The report speculates that, if there is plenty of green ammonia in 2050, it “will likely replace gas-based ammonia production.” This would impact the fertilizer market because “this will also eliminate production of urea since the carbon dioxide necessary for urea production will not be available anymore.” As a result, producers “will reintroduce [nitrate-based] fertilizers in the US, Asia and Africa.” (I addressed this subject last week, regarding Stamicarbon’s Innovation Agenda.)

Another factor that increases the attractiveness of nitrate production is that while hydrolysis of water provides the necessarily large amounts of hydrogen needed to fuel the world, it also produces large quantities of oxygen. This oxygen can be used to improve the production of nitric acid from ammonia, as an intermediate in the ammonium nitrate production process. In addition, oxygen fed into heating gas instead of air results in purer emissions, and using oxygen makes the traditional ammonia process fully suitable for carbon capture and storage
Feeding Life 2030, Fertilizers Europe, November 2018

From vision to reality
The report concludes by calling for a supportive policy framework within the EU. Much of this section focuses on maintaining a “level playing field” and concerns of “carbon leakage,” because European producers already operate “the world’s most energy efficient fertilizer production facilities.” This allows Fertilizers Europe to claim, in relative terms, that “from a global climate perspective, each tonne of production in Europe saves global CO2 emissions.” I should point out that, in absolute terms, from a global climate perspective, each tonne of ammonia production in Europe causes the emission of about two tonnes of CO2, which can be eliminated by displacing fossil feedstocks.

One policy imperative is striking, however, in its vision for ammonia as chemical energy.

Enabling transition to a decarbonised economy
The EU has the aspiration of leading the world in addressing the global climate change challenge and is currently looking at cost-effective ways to decarbonise the economy.

As renewable energy and hydrogen are to play an increasingly important role in powering the EU economy, ammonia should be regarded as an important way to store and transport hydrogen in energy systems with a high penetration of renewables. It is essential that policies include ammonia in decarbonisation efforts, through support for research and pilot projects plus implementation of the necessary standards for energy pipes and transportation.
Feeding Life 2030, Fertilizers Europe, November 2018

I’ve written recently about a number of such European demonstration projects, including Haldor Topsoe’s solid oxide electrolyzer, which recently announced that its 100% electric ammonia pilot plant was planned for 2025 in Denmark, and Yara’s Ammonia plant revamp to decarbonize at Sluiskil in the Netherlands.

Mission Possible
Another important report, also published in November 2018, was called Mission Possible. As I wrote in January this year:

Among its 172 pages of assumptions, analysis, and explanation, Mission Possible examines production pathways and markets for green ammonia and its derivative green nitrogen fertilizers. It addresses the relatively straightforward issue of how to replace fossil feedstocks with renewable hydrogen for ammonia synthesis, as well as the more complex question of how to source or supplant the carbon dioxide molecules contained in urea, the most common nitrogen fertilizer.

The report’s economic conclusions will not surprise anyone involved in ammonia production or politics. Yes, green ammonia is currently more expensive than fossil ammonia, although it won’t be for long. And no, “none of the increases in end-consumer prices are sufficiently large to be an argument against forceful policies to drive decarbonization.”
Mission Possible: decarbonizing ammonia, AmmoniaIndustry.com, January 2019

Click to visit. Mission Possible, Energy Transitions Commission, November 2018

Mission Possible was published by the Energy Transitions Commission (“a coalition of business, finance and civil society leaders from across the spectrum of energy producing and using industries”), and describes itself as “a clear signal to policymakers, investors and businesses: full decarbonization is possible, making ambitious climate objectives achievable.”

It is important to refer to Mission Possible here because, while Feeding Life 2030 represents a good beginning, the next steps for Fertilizers Europe and, indeed, all the other fertilizer industry associations around the world, have already been clearly articulated in Mission Possible.

In the final section of Mission Possible (Chapter 10, beginning on page 165), it summarizes “the responsibility of trade associations and industry initiatives in harder-to-abate sectors,” like fertilizers.

This segment of the report is entitled “Raising ambitions.”

Industry associations in key industrial sectors … are already aiming to achieve significant carbon reductions by mid-century [this comment refers to industrial segments other than fertilizer, like aviation and shipping]. These efforts could be further strengthened by:

  • Developing roadmaps to net-zero carbon emissions by mid-century, including clear specification of how transitional solutions such as offsets or use of unabated natural gas will be phased out over time;
  • Developing cross-sectoral initiatives to develop demand for low/zero-carbon products
  • Using their lobbying capacity to advocate ambitious international agreements on carbon pricing

It is essential for industry associations to align corporate lobbying with the net-zero-carbon-emissions agenda, by not opposing and preferably actively using their lobbying capacity to support a set of policies (including carbon prices and regulations) which are necessary to drive progress in their sectors.
Mission Possible, Energy Transitions Commission, November 2018

These are the three urgent action items for every fertilizer trade association. First, develop a roadmap to net-zero carbon emissions. Second, develop demand for the new low-carbon product. Third, lobby for the regulatory support needed to realize that vision.

3 comments

  1. Joe Beach says:

    I have read about efforts to use new gene editing technology to transfer the nitrogen-fixing capabilities of legumes and other plants to crops like corn and wheat. How seriously does the nitrogen fertilizer industry take that? Do they worry about a future in which nitrogen fertilizer is not needed, and they mainly need to focus on phosphorous and other mineral nutrients?

    • Trevor Brown says:

      There’s no short answer to this comment. Here are two thoughts in reply.

      As I understand it, some parts of the industry hope to evolve from selling commodity products to selling (higher-value) services: instead of selling a kilo of nutrient, you could sell a guaranteed yield per hectare. Much of the increase in crop yield is a product of know-how (The 4 Rs: the right nutrients, at the right rate, at the right time, in the right place). Using exactly the minimum, ie optimal, amount of fertilizer would be an obvious cost-efficiency measure for a company selling yield. In this future, the “fertilizer industry” wouldn’t necessarily depend on traditional manufacturing, so much as on big-data, IP, and agronomy. Gene-editing would fit right into that vision.

      People have been trying to breed self-fertilizing crops for decades, without much success; I’ve not seen much data to imply that this will change in the future as a result of new technology (eg, CRISPR). The big breakthroughs I am seeing in gene editing are not the crop, but the soil microbes – after all, it isn’t the legume that fixes the nitrogen, it’s the soil microbes, which the legume hosts in symbiosis. I’ve written about a few of these technologies, including Joyn Bio (a Bayer-Monsanto / Ginkgo Bioworks joint venture), Pivot Bio (which recently announced funding from Bill Gates’s Breakthrough Energy Ventures), and Harvard’s “bionic leaf.” This isn’t a fundamental challenge to the fertilizer industry’s business model, as I see it: it’s simply a different kind of product that delivers the same service. I’m sure today’s big fertilizer manufacturers and retailers are looking at these bioengineering start-ups as long-term potential acquisition targets.

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