Hydrogen and Ammonia Represent the Present and Future of the Energy Transition

Public and private investments in hydrogen and ammonia technology have risen dramatically in recent years. The investment opportunity for low-carbon hydrogen could exceed $600 billion, according to Wood Mackenzie. There’s a good reason for this growing popularity: These two cases show substantial promise for speeding up decarbonization across a range of settings, from power generation to hard-to-abate sectors like heavy industry and long-haul transportation. Because they can be deployed flexibly, both cases could play a critical role in building momentum throughout the energy transition.

Earlier today, I spoke on a CERAWeek panel with Trevor Brown, CFA of the Ammonia Energy Association, Jeffrey Benoit of Hanwha Power Systems Americas and S&P Global’s Coralie Laurencin (Chappaz) about how the power industry can manage the challenges and expectations for a hydrogen-driven future.

Here’s what stood out to me from our conversation:

Hydrogen offers a path through multiple stages of the energy transition

Hydrogen has tremendous promise as a fuel, but it must first overcome a series of challenges before that goal can be fully realized. Delivering hydrogen directly to advanced class gas turbines with Dry LoNox systems requires some technological advancements. Thankfully, many of those advancements are already underway. For example, Mitsubishi Power Americas demonstrated the use of a 20% hydrogen blend in an M501G gas turbine at Georgia Power Company’s Plant McDonough-Atkinson on the outskirts of Atlanta in 2022.

While this is a major milestone, it is also just the beginning of the longer journey to electricity generated by 100% clean hydrogen. In the meantime, however, hydrogen can play a more immediate role in accelerating the energy transition by providing long-term green energy storage.

Electrolysis, the technology used to create green hydrogen, isn’t new. Additionally, the growing availability of renewable power is changing the cost equation. The amount of energy we can generate from sun or wind is variable, making it difficult to match supply with electricity demand at any given moment. To maintain equilibrium, some portion of the power supply comes from dispatchable sources that can generate more or less power on demand. To avoid letting renewable capacity sit idle when renewable power generation exceeds demand, we need a way to store them for later use. Using excess renewable power to produce clean hydrogen will allow us to store those electrons much longer than current battery storage technology could.

Ammonia creates additional paths toward a global hydrogen market

Storing and transporting hydrogen at the scale necessary to decarbonize the electrical grid also will require substantial infrastructure development. In Delta, Utah, the presence of massive underground salt caverns make it possible for Mitsubishi Power and Magnum Development to create the Advanced Clean Energy Storage Hub, a facility slated to store 300 gigawatt-hours of clean hydrogen produced by 220 megawatts of on-site alkaline electrolysis.

However, those underground resources are not available in all geographies—which is where ammonia comes in.  As a combination of hydrogen and nitrogen, ammonia is already used widely as a fertilizer, which means storage and transportation infrastructure already exists. Ammonia also has a higher energy density than hydrogen. It becomes liquid at a much higher temperature and lower pressure than hydrogen, making it easier to store and transport.

These characteristics make green ammonia attractive to policymakers in countries that either already have the infrastructure to handle ammonia or have less capacity to develop clean hydrogen facilities. Already, the United States and much of Europe are developing green hydrogen markets, while countries like Germany are exploring ammonia imports as part of a broader hydrogen strategy. In the coming months, I expect ammonia will likely be more attractive to policymakers and industry stakeholders in Japan and South Korea.

A net zero grid will be the function of many innovations and technologies working in tandem

The number of applications for clean hydrogen and ammonia will continue to grow as the power industry overcomes the challenges involved with using these gases as a fuel. Although it’s still early in testing, Ammonia is especially attractive as a bridge technology because it can be used to generate power either through direct combustion or by separating the hydrogen and nitrogen molecules – at which point it can be used in any turbine that can use hydrogen.

As in other areas of the energy transition, a thriving hydrogen marketplace will require multiple innovations and multiple technologies pursued in parallel to come to fruition. That’s why Mitsubishi Heavy Industries, parent company of Mitsubishi Power and its partners are developing ammonia co-fired power generation with the Japanese power generation company JERA Co., Inc. and collaborating on direct ammonia combustion projects in Singapore and Indonesia, in addition to a feasibility study for ammonia co-firing at a coal-fired power plant in Thailand. These projects are aimed at accelerating progress toward a decarbonized electrical grid – and a global net zero future.