Profitability analysis of green ammonia production as fuel for shipping at Eydehavn
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Abstract
This thesis investigates the profitability of North Ammonia’s production of green ammonia forshipping, focusing on key factors influencing its success. Green ammonia, recognised as apromising candidate for decarbonising the shipping industry, is produced with zero emissionsusing renewable energy sources. However, uncertainties surrounding future availability anddemand hinder its widespread adoption.
Using a conceptual framework and a case study research design, the thesis addresses theproblem statement by dividing it into three research questions, each covering a specificdimension. Firstly, the macro environment is examined to determine the potential profitabilityof green ammonia production in Norway. Political and technological factors are identified ascrucial in establishing the market and influencing profitability. While the potential market sizeindicates profitability, several undetermined factors require clarification for a conclusiveassessment. Factors such as access to renewable energy, location, knowledge, and technologyare found to be influential. Furthermore, the study identifies access to renewable energy andlocation as potential competitive advantages for North Ammonia if effectively leveraged. AWEis determined to be the most economically viable electrolysis technology for the project, withthe choice between AWE and PEM having minimal impact on profitability. Energy prices areidentified as the most significant factor affecting production costs and, consequently, NorthAmmonia’s project profitability.
This research contributes to the ongoing investigation of green ammonia as a shipping fuel,focusing on the profitability of Norwegian production. The identified macro environmentalfactors and North Ammonia’s resources provide valuable insights for a new and emergingmarket. Further analysis of technology choices and production costs will enhance theunderstanding of green ammonia production. However, it is important to note that theconclusions drawn in this thesis are limited to the available data and require further researchfor a comprehensive assessment.