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Is Green Ammonia the Answer to Shipping in the Era of Climate Change?

Climate change continues to be a huge issue for shipping and the world.

Suppose that a small percentage of the total container ships in service worldwide continue to transition to greener fuel sources over the next few decades. With thousands of container ships in service throughout the world, there will still be many ships unable or unwilling to make the transition to greener fuels due to higher costs, engineering requirements, etc.

Traditional alternative fuel sources have been somewhat unreliable on a consistent basis. Wind power, for example, requires favorable wind conditions to generate enough energy for power. Solar energy is easily affected by the weather. Hydrogen fuel did not take off, as once was predicted, due to technological difficulties of producing stable combustion from hydrogen gas.

Is green ammonia the answer for the shipping industry?

Another study has now found that green ammonia could replace these alternative fuels and become a leading green fuel source for the shipping industry. A new study published by the Institute of Physics shows that green ammonia could fuel 60% of shipping worldwide. Green ammonia works similarly to ultra-low sulphur fuel, which the shipping industry has used to power container ships, especially since the IMO 2020 rule went into effect.

How much would using green ammonia industry-wide cost?

The study estimates that it would cost as much as $2 trillion to transit to green ammonia, mainly due to the infrastructure upgrades required to produce and supply the fuel worldwide. Any systemic upgrade to cleaner fuel will cost a significant sum of money over the long-term. When broken down between 2024 and 2050 (26 years), the cost comes out to about $77 billion a year.

Previously, green ammonia was proposed over the years and thought to be unsustainable on a large scale, due to the sheer volume of existing infrastructure. However, the new study outlined and analyzed a potential green ammonia supply chain, developed by the University of Oxford, that makes this fuel type sustainable over the long-term. It prioritized specific ports and facilities, modeled trade lanes, and covered storage/transport infrastructure.

We encourage our readers to view the full study and overview at this link.


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