IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v157y2020icp404-414.html

Technical-economic analysis for a green ammonia production plant in Chile and its subsequent transport to Japan

Author

Listed:
  • Fúnez Guerra, C.
  • Reyes-Bozo, L.
  • Vyhmeister, E.
  • Jaén Caparrós, M.
  • Salazar, José Luis
  • Clemente-Jul, C.

Abstract

Green ammonia can be produced using fossil fuels or any renewable energy source combined with heat or electricity. Chile has one of the highest rates of solar irradiation and also the environmental conditions that support the development of solar industry. Other renewable sources of energy are the wind and the hydraulic dams. These energies could be used to generate ammonia by a standard method such as the Haber-Bosch process, which transforms hydrogen and nitrogen using high temperatures and a catalyst. The ammonia has several desirable characteristics that suggest its use as a way to store hydrogen. Firstly, it can be liquified under mild conditions. Secondly, the ammonia has a high weight fraction of hydrogen. Thus, it is deemed necessary to study technical and economic variables that may support the use of green ammonia as an energy carrier for hydrogen. The aim of this work is to develop a technical-economic analysis about the production of ammonia using hydrogen by means of electrolysis (carried out with solar, wind, and hydraulic renewable energies). The aforementioned green ammonia would be produced in Chile and it would be necessary to transport it to Japan. Sensitivity analysis of main parameters (plant operating hours, size of the ammonia synthesis plant - related to the capacity of the electrolysis plant size in MW-, electricity price, electrolyzer cost, Haber-Bosch cycle cost, and ammonia sales price) was performed to report what factors are primordial at the moment of carried out techno-economic analyses. An optimization process that minimize the NPV was run in order to settle the most convenient size of the electrolyser stack. A net present value (NPV) of base case is €77,414,525 and 7.62 years of pay-back period were calculated for this green ammonia production plant, which considered hydrogen production via electrolysis, Haber-Bosch processes, and trade values of different operational units. The sensitivity analysis has determined that the main variables affecting the NPV are the size of the ammonia synthesis plant and the electricity price. Furthermore, by considering triangular probability distribution of specific variables, it was observed that with a 95% of confidence, the NPV would be positive with a 76.1% of occurrence. The optimization process defined that a stack of 164.21 MW would be the most convenient electrolyser stack dimension, which was estimated by considering all different effects over the operational expenditure (OPEX), capital expenditure (CAPEX), and investments risk. Therefore, the hydrogen production in Chile and its transportation to Japan using ammonia as an energy carrier would be a technically viable and profitable solution, which also has environmental benefits.

Suggested Citation

  • Fúnez Guerra, C. & Reyes-Bozo, L. & Vyhmeister, E. & Jaén Caparrós, M. & Salazar, José Luis & Clemente-Jul, C., 2020. "Technical-economic analysis for a green ammonia production plant in Chile and its subsequent transport to Japan," Renewable Energy, Elsevier, vol. 157(C), pages 404-414.
    • Handle: RePEc:eee:renene:v:157:y:2020:i:c:p:404-414
    DOI: 10.1016/j.renene.2020.05.041
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148120307394
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2020.05.041?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Remer, Donald S. & Nieto, Armando P., 1995. "A compendium and comparison of 25 project evaluation techniques. Part 1: Net present value and rate of return methods," International Journal of Production Economics, Elsevier, vol. 42(1), pages 79-96, November.
    2. Papada, Lefkothea & Kaliampakos, Dimitris, 2018. "A Stochastic Model for energy poverty analysis," Energy Policy, Elsevier, vol. 116(C), pages 153-164.
    3. Miura, Daisuke & Tezuka, Tetsuo, 2014. "A comparative study of ammonia energy systems as a future energy carrier, with particular reference to vehicle use in Japan," Energy, Elsevier, vol. 68(C), pages 428-436.
    4. Michalsky, Ronald & Parman, Bryon J. & Amanor-Boadu, Vincent & Pfromm, Peter H., 2012. "Solar thermochemical production of ammonia from water, air and sunlight: Thermodynamic and economic analyses," Energy, Elsevier, vol. 42(1), pages 251-260.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Perna, A. & Minutillo, M. & Jannelli, E. & Cigolotti, V. & Nam, S.W. & Han, J., 2018. "Design and performance assessment of a combined heat, hydrogen and power (CHHP) system based on ammonia-fueled SOFC," Applied Energy, Elsevier, vol. 231(C), pages 1216-1229.
    2. Yadav, Deepak & Banerjee, Rangan, 2016. "A review of solar thermochemical processes," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 497-532.
    3. Llorca, Manuel & Rodriguez-Alvarez, Ana & Jamasb, Tooraj, 2020. "Objective vs. subjective fuel poverty and self-assessed health," Energy Economics, Elsevier, vol. 87(C).
    4. Francesco Cappa & Fausto Del Sette & Darren Hayes & Federica Rosso, 2016. "How to Deliver Open Sustainable Innovation: An Integrated Approach for a Sustainable Marketable Product," Sustainability, MDPI, vol. 8(12), pages 1-14, December.
    5. Obara, Shin'ya, 2019. "Energy and exergy flows of a hydrogen supply chain with truck transportation of ammonia or methyl cyclohexane," Energy, Elsevier, vol. 174(C), pages 848-860.
    6. Morelli, Martin & Harrestrup, Maria & Svendsen, Svend, 2014. "Method for a component-based economic optimisation in design of whole building renovation versus demolishing and rebuilding," Energy Policy, Elsevier, vol. 65(C), pages 305-314.
    7. Abbas, Khizar & Li, Shixiang & Xu, Deyi & Baz, Khan & Rakhmetova, Aigerim, 2020. "Do socioeconomic factors determine household multidimensional energy poverty? Empirical evidence from South Asia," Energy Policy, Elsevier, vol. 146(C).
    8. Srivastava, Nitish & Saquib, Mohammad & Rajput, Pramod & Bhosale, Amit C. & Singh, Rhythm & Arora, Pratham, 2023. "Prospects of solar-powered nitrogenous fertilizers," Renewable and Sustainable Energy Reviews, Elsevier, vol. 187(C).
    9. Magni, Carlo Alberto, 2016. "Capital depreciation and the underdetermination of rate of return: A unifying perspective," Journal of Mathematical Economics, Elsevier, vol. 67(C), pages 54-79.
    10. Mehdi Bahrami & Mohammad Javad Amiri & Mohammad Reza Mahmoudi, 2020. "Clustering the Adsorbents of Horizontal Series Filtration in Greywater Treatment," Sustainability, MDPI, vol. 12(8), pages 1-14, April.
    11. Dodoo, Ambrose & Gustavsson, Leif & Tettey, Uniben Y.A., 2017. "Final energy savings and cost-effectiveness of deep energy renovation of a multi-storey residential building," Energy, Elsevier, vol. 135(C), pages 563-576.
    12. Yukio Watanabe & Wataru Aoki & Mitsuyoshi Ueda, 2021. "Sustainable Biological Ammonia Production towards a Carbon-Free Society," Sustainability, MDPI, vol. 13(17), pages 1-13, August.
    13. Laura Gabrielli & Aurora Greta Ruggeri & Massimiliano Scarpa, 2023. "Roadmap to a Sustainable Energy System: Is Uncertainty a Major Barrier to Investments for Building Energy Retrofit Projects in Wide City Compartments?," Energies, MDPI, vol. 16(11), pages 1-21, May.
    14. Ekaterina Makarova & Anna Sokolova, 2012. "Foresight Evaluation: Lessons from Project Management," HSE Working papers WP BRP 01/MAN/2012, National Research University Higher School of Economics.
    15. Minjeong Sim & Dongjun Suh & Marc-Oliver Otto, 2021. "Multi-Objective Particle Swarm Optimization-Based Decision Support Model for Integrating Renewable Energy Systems in a Korean Campus Building," Sustainability, MDPI, vol. 13(15), pages 1-18, August.
    16. Liu, Xing & Wang, Ying & Bai, Yuanqi & Yang, Wenxu, 2023. "Development of reduced and optimized mechanism for ammonia/ hydrogen mixture based on genetic algorithm," Energy, Elsevier, vol. 270(C).
    17. Yadav, Deepak & Banerjee, Rangan, 2022. "Thermodynamic and economic analysis of the solar carbothermal and hydrometallurgy routes for zinc production," Energy, Elsevier, vol. 247(C).
    18. Gabriele Battista & Emanuele de Lieto Vollaro & Andrea Vallati & Roberto de Lieto Vollaro, 2023. "Technical–Financial Feasibility Study of a Micro-Cogeneration System in the Buildings in Italy," Energies, MDPI, vol. 16(14), pages 1-15, July.
    19. Cuthbert, James R. & Magni, Carlo Alberto, 2016. "Measuring the inadequacy of IRR in PFI schemes using profitability index and AIRR," International Journal of Production Economics, Elsevier, vol. 179(C), pages 130-140.
    20. García Kerdan, Iván & Raslan, Rokia & Ruyssevelt, Paul & Morillón Gálvez, David, 2017. "A comparison of an energy/economic-based against an exergoeconomic-based multi-objective optimisation for low carbon building energy design," Energy, Elsevier, vol. 128(C), pages 244-263.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:renene:v:157:y:2020:i:c:p:404-414. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/renewable-energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.