AB Achema: decarbonised fertiliser production in Lithuania
By on July 24, 2024
EU approves €122 million for electrolysis project
Click to learn more. AB Achema has been granted €122 million to develop an electrolysis project at its existing ammonia and fertiliser production plant in Kaunas, Lithuania. Source: AB Achema.
The European Commission has approved a Lithuanian state grant that will support AB AChema to decarbonise fertiliser production at its existing facility in Kaunas, Lithuania. The funds will go directly towards the installation of a 171 MW alkaline electrolyser plant, producing renewable hydrogen feedstock that will be able to displace up to 30% of the current, gas-based feedstock used in Kaunas. AB Achema aims for the plant to produce hydrogen by 2026, and operate for 20 years. The announcement notes that AB Achema is committed to actively sharing operational experience and technical insights from development of the project, helping contribute to the deployment of clean technologies in the European fertilisers industry.
This €122 million measure enables Lithuania to help AB Achema step up its renewable and low-carbon hydrogen capacities. This will contribute to the greening of the fertilisers value chain, in line with the EU’s target of climate neutrality by 2050. At the same time, the measure ensures that any potential competition distortions are kept to the minimum.
Margrethe Vestager, European Commission Executive VP (Competition Policy), in her organisation’s official press release, 12 July 2024
To secure renewable electricity for the electrolysis plant, AB Achema committed to purchasing power output from the new 264 MW Pagėgiai wind farm. In April, the Nordic Investment Bank agreed to loan LT Energija €100 million for development of the wind farm, with €43.5 million of this loan backed by the InvestEU programme. The 21-year loan will help finance the construction of 40 wind turbines, significantly increasing energy generation capacity in Lithuania (which currently imports the majority of its power consumption).
Not only will it help Lithuania build up its renewable energy capabilities, it will also reduce reliance on natural gas imports and advance the development of green technology, positively affecting the entire region.
André Küüsvek, NIB President & CEO in the Commission’s official press release, 2 Apr 2024
First tons produced in 1965
AB Achema is the largest producer of nitrogen fertilisers and chemical products in Lithuania. Construction of the factory near Jonava City started in 1962, on a site with strategic riverway, road and rail connections to Baltic Sea ports. The state-owned enterprise was privatised in 1994 to form AB Achema.
The first tons of ammonia were produced in 1965. Since 1965, the capability to produce methanol, urea, nitric acid, ammonium nitrate, resins, formalin, NPK fertilisers, and AdBlue (amongst others) has been added to the site. Two cogeneration power plants have been added for site power. The site is currently the largest gas consumer in Lithuania.