OIES – The Economics of Decarbonising Europe’s Ammonia Industry

The document focuses on the economic analysis of decarbonizing ammonia production in Europe, which is a crucial task for achieving the region's climate goals.

The study examines various hydrogen production pathways, such as steam methane reforming (SMR), SMR with carbon capture and storage (CCS), biomass gasification (BIOH₂), and renewable-based electrolysis. The research identifies the most viable decarbonization pathways for the mid-term (2030-2040), considering factors like renewable energy potential, subsidy availability, and feedstock costs. In a scenario without subsidies or carbon pricing, existing SMR remains the most financially competitive. However, with the introduction of policy mechanisms such as carbon pricing and renewable hydrogen subsidies, there is a significant shift towards renewables.