JERA opens tender for long-term ammonia supply contract
By on February 17, 2022
500,000 tonnes per year fuel ammonia to Japan
Japanese power utility JERA has launched an international bidding process to procure 500,000 tonnes per year of fuel ammonia, starting in 2027 and running into the 2040s. The fuel ammonia is destined for the Hekinan power plant, where trials of ammonia-coal co-firing have been underway since last August. JERA and IHI aim to have a 20% co-firing demonstration operational sometime in 2024.
JERA puts two conditions on any contract bid:
1. As a rule, CO2 is either not generated during ammonia production or is captured and stored.
2. JERA has the opportunity to participate in production projects.
JERA’s official press release, 18 Feb 2022
Speaking with other outlets, JERA officials confirm that the acceptable threshold for emissions capture is 60% or above. Officials also note that figure may be subject to future review.
A drop in the (co-firing) ocean
500,000 tonnes of ammonia is a significant amount, but it only goes so far for this particular application. A single 1 GW unit at a multi-unit coal power plant would consume this much ammonia over a year when operating at a 20% co-firing rate. JERA has already indicated it intends to raise its co-firing benchmark to 50% ammonia. Extrapolate this out to Japan’s domestic coal power plant fleet, and we are talking tens of millions of tonnes of fuel ammonia needing to be shipped to Japan every year. So while JERA’s new contract offering is a groundbreaking step in the ammonia energy space, it may well end up as a very conservative baseline for future procurement contracts.