Green Ammonia Is The New Chick On The Block And South Africa Its Hub

Sans ammonia, the world wouldn't be able to produce roughly half of the food today. However, due to its vast use in agriculture and industry, its production involves fossil fuels and is responsible for 1.8 percent of global CO2 emissions.

Enter green ammonia, which can slash the carbon footprint and its new uses, especially in the maritime industry, which currently causes more than 3 percent of global CO2 emissions.

Ahead of the United Nations Climate Change Conference, COP27, in Egypt in November, South Africa is betting big on the hydrogen economy with world's largest green ammonia project under the South African Hydrogen Society Roadmap (HSRM), announced by the government in February 2022.

Its climate-resilient economy efforts got a major boost in August this year when the Johannesburg Stock Exchange announced the possibility of introducing a carbon trading market.

South Africa with its world's largest green ammonia plant is trying to be the torch-bearer. In Nelson Mandela Bay in the Eastern Cape in the southern part of the country, thousands of hectares of land are earmarked to host the $4.6 billion green ammonia plant.

"It'll start replacing heavy fuel oils on ships and it'll replace diesel. That will become the fuel of the future, particularly in the maritime industry," said Colin Loubser, managing director of Hive Energy Africa, which builds the plant.

The proposed landmark plant has its own dedicated green power supply at the Coega special economic zone alongside the Port of Ngqura.

When the project becomes operational in 2026, it will generate 20,000 jobs in Eastern Cape, where the current unemployment rate is over 50 percent.

The southern part of the country was selected as the region has proved favorable for green ammonia production and its export. As a leading economy of Africa, the plant will serve as a significant response to deliver on COP26 commitments by South Africa.

To meet the global net zero target, green ammonia needs to account for 45 percent of the global energy demand from the shipping sector by 2050, according to the International Energy Agency.

However, two factors limit its use. Firstly, ammonia is a pungent and toxic gas. So, only trained professionals can handle it. Secondly, using it as a fuel produces nitrogen oxides, which then cause air pollution.

As far as the shipping sector is concerned, ship engines that can work on green ammonia are still under development.

Due to these, the green ammonia business is yet to get a boom. But it will gather pace by 2030 when the green ammonia market will become a $5.4 billion industry from its current level of just $36 million in 2021.

Besides the global commitment to limit emissions to an increase of no more than +1.5 C by 2050, the ongoing Ukraine war has put political pressure on nations to swap fossil fuel for a greener molecules. And green ammonia fits the bill as governments and mega-corporations have found it good.

To churn out green ammonia, electrolysis is used to separate water into hydrogen and oxygen. With the help of an air separation unit, nitrogen is extracted from the air which is later combined with hydrogen to produce ammonia, using renewable energy.

As hydrogen is abundant in nature, its use in a wide range of everyday purposes and industrial applications are set to increase. In fact, hydrogen is cited as a direct replacement for fossil fuels.

Since hydrogen burns cleanly, producing only water vapor and heat, it can reduce emissions contributing to the greenhouse impact.

The International Renewable Energy Agency is working on the premise that the production of hydrogen from renewables will deliver 19 exajoules (EJ) of energy in 2050 and governments and nations around the world do not want to be left behind in the race to incorporate hydrogen into their energy strategies.

More than 30 nations have unveiled plans for green hydrogen and more than 200 projects worth more than $70 billion are already in the pipeline, according to global management consulting firm McKinsey & Co.

Saudi Arabia, the Mecca of fossil fuel, has already hit the hydrogen economy bandwagon with a $5 billion green hydrogen plant at Neom, a planned city.

Under the Energy Earthshot program, the U.S. intends to cut the cost of green hydrogen to $1 per kilogram within a decade.

The UAE, Australia, Korea, Chile, Morocco, India, and Brazil, as well as transnational firms like Shell, BP, and Toyota have already tested the waters and found it good.

Now, green ammonia and the hydrogen economy will help save the planet and to feed the world and South Africa is looking for a larger slice of the pie.