Why is Ammonia (Hydrogen) part of the Offshore Energy Generation System (OEGS) solution?
Today in May 2024, we know that S&P Global Commodity Insights (among others) has forecasted that the Ammonia market will triple by 2050. We also know that in the UN Climate Conference, COP28 UAE the Net Zero Nuclear Tripling Nuclear Capacity by 2050 pledged by 22 countries, and counting, with the UK pledging to Quadruple Nuclear Capacity.
In 2015 the UN Climate Change Conference @COP21 (COP21) called to deliver 50% more energy without greenhouse gas emissions. The natural response could be to deliver more electricity. But there are many business and technical reasons not to take this path, and we are trying to summarize the main points below. We have business drivers that are needed to attract and retain investment and to provide a sustainable solution at scale. The technical drivers are needed to ensure the solution delivers what the consumers and investors are looking for.
The Business Case
We all know the OEGS delivers reliable affordable electricity based on the synergy between the most advanced nuclear technology (Small Modular Reactors, SMRs), and the most advanced offshore technology already commercialized with the global supply chain by the oil and gas industry. We know the electricity market will continue growing considering the upcoming growth in power demand driven by Artificial Intelligence (AI). “3-4% of global demand” per S&P Global. This growth is in addition to the other market forces already pushing the demand higher than expected e.g. EV Electric Vehicle electrification, blockchain, crypto, and advanced manufacturing accelerated by nearshoring. The International Energy Agency (IEA) presented a great analysis and forecast at https://www.iea.org/reports/electricity-2024. On top of that we know there are more than 775 million people who live without electricity as per International Energy Agency (IEA) and Four billion people, almost two-thirds of the world’s population!!, that experience severe water scarcity for at least one month each year as per UNICEF. But this is the topic for other future articles.
Figure 1 Estimate US Energy Consumption in 2022
We need 50% more energy but most of the energy consumed is not electricity, it is Heat. As shown in the Figure 1 Estimated US Energy Consumption in 2022 from the Lawrence Livermore National Laboratory most than 60% energy consumption is Heat and globally, we have a similar situation as it is illustrated in the Figure 2 Global Primary Energy consumptions from Our World in Data.
Figure 2 Global Primary Energy Consumption
The Technical Case
In our opinion, the laws of nature, including physics and chemistry, will continue prevailing for many centuries to come; therefore, businesses that do not embrace them are not likely to survive despite any tax incentives, or any government assistance they may receive.
Then if our consumers need heat; how We can satisfy that need of energy? As we can see in Figure 1 for the US (similar to the rest of the world), hydrocarbon fuels are the most common type of energy carrier, they have been very effective and efficiently satisfying that need providing almost 80% of the demand. The mightily United Nations Environment Programme Finance Initiative (UNEP FI)
and the financial industry, retail investors, and consumers are calling to minimize the greenhouse emissions associated with burning hydrocarbons, there is a business case for using hydrocarbons in so many other applications that do not produce greenhouse emissions at competitive prices.
Then after a very systematic and comprehensive analysis of all the potential fuels with no greenhouse emissions hydrogen and ammonia as hydrogen carriers have been selected, if the greenhouse emissions are eliminated at a competitive price. Ammonia (NH3) consists of one nitrogen atom and three hydrogen atoms. Although found in nature, the production of ammonia is a global industry. With advanced offshore nuclear the hydrogen production from desalinated water via electrolysis was favored. The conversion of hydrogen into ammonia for transportation and storage using the nitrogen air from the air was also favored.
Electricity is a great energy carrier to other forms of energy, such as heat or mechanical, but it has some intrinsic limitations for storage and transportation. It is not practical to store large amounts of electricity; we must convert the electricity into other forms of energy, like what we do with batteries where the energy is stored in the form of chemical potential, and then we have limitations on the chemistry of the materials to enable recharging the batteries.
Figure 3 Electricity Ohms Law on Physics
Electricity transmission has inherent limitations, the longer the transmission distance; the higher the voltage needed for the electric energy transmission through the cable. Ohms's law is part of those inherent limitations as shown in Figure 3. (www.circuitbasics,com) Ohm’s law describes this with V (voltage) = I (current) x R (resistance). The longer the cable, the higher the resistance, therefore additional voltage is required to maintain the same current. Then the higher the voltage the larger the facilities needed to increase the drop the voltage, and the condition to be used for the consumption and distribution. From the Ohm law, we also understand that there are losses of energy because of the transition. Depending on the transmission distance AC alternated current or Direct Current could offer a lower scope and associated costs but nonetheless, the ohm law is here to stay.
Conclusion:
To resolve the global climate challenge, besides increasing our electricity supply, alternative fuels like ammonia (as a hydrogen carrier) without greenhouse emissions must start to expand and replace the current mix of hydrocarbon fuels. While the passenger vehicle segment has made progress with electrification, other industries, like maritime shipping, present a more complex range of challenges such as lengthy travel times, high power output demands, and trade-offs with cargo storage space. There’s an emerging consensus that ammonia will be the most economical option for transporting hydrogen over long distances. Many developers intend to convert hydrogen into green ammonia before shipping it to international markets.
As per Amogy, Ammonia is also the second-largest chemical produced globally. 18 million tons of ammonia are currently stored and transported each year. Additionally, more than 200 gas carriers capable of shipping ammonia and liquid petroleum gas are currently in operation around the world. And 150-200 ports are equipped with terminals for unloading and storing traded ammonia. As an internationally traded commodity, ammonia already has a well-developed distribution network available to support its use as an alternative fuel.
