Ammonia-to-hydrogen cracking is becoming an important topic for low-carbon ammonia producers globally who are targeting European hydrogen demand.

Multiple low-carbon ammonia producers located in potential supply regions like India, the Middle East, Africa, the US and Latin America told Platts that they are monitoring the development of ammonia cracker testing and related infrastructure in Europe.

The additional costs and carbon emissions involved in cracking are crucial in determining the competitiveness of cracked hydrogen against locally produced hydrogen. According to market activity reported to Platts, Renewable Fuels of Non-Biological Origin-compliant hydrogen landed in Europe after cracking can cost in the range of $7.50-$9/kg, depending on factors like the cost of low-carbon ammonia, cracking fuel, and the efficiency of the electrolyzers.

"There are a lot of challenges around the ammonia cracking process, considering efficiencies, and of course, the fuel use," said a Latin American project developer.

He noted that a landed cost of $8-$9/kg for RFNBO-compliant hydrogen in Europe could be "viable."

Cracked hydrogen maintains discount

Platts calculations show that cracking costs double when using renewable ammonia as a cracking fuel instead of natural gas, as renewable ammonia is more expensive than natural gas. Despite the additional cost of using renewable ammonia as a cracking fuel, German RFNBO-compliant renewable hydrogen was $1.50/kg more expensive than cracked renewable hydrogen in May.

Platts German renewable hydrogen averaged at Eur7.91/kg ($9.03/kg) during May. Middle East renewable-derived ammonia delivered into Northwest Europe averaged $838/mt for the month.

Producers exporting ammonia as a hydrogen vector to Europe need to evaluate whether they need to use natural gas, low-carbon ammonia or a mix of both fuels to crack ammonia to hydrogen. While natural gas is cheaper than low-carbon ammonia, it has higher carbon emissions, but only compared to certain grades of ammonia.

When used as a cracking fuel, low-carbon ammonia with a carbon intensity of more than 4 kg CO2e/kg H2 well-to-gate has a higher carbon intensity than natural gas, according to a January analysis by Anri Nakamura, S&P Global Commodity Insights associate director for hydrogen and renewable gas.

This means that only low-carbon ammonia produced with a carbon capture rate of more than 90% -- and in some cases even 70%, depending on the upstream natural gas emissions in the ammonia production region -- would save carbon emissions during cracking compared to using natural gas as a fuel.

Unanswered questions about nascent technology

An Indian source following the cracker market development in Europe suggested that without a large-scale ammonia cracker installed, it is difficult to comment on technology efficiency and cracking costs.

He said crackers will likely be a shared resource, but many unanswered questions remain, including: "Are the crackers going to be installed at ports or industrial clusters? What are the energy losses and emissions associated with them? Who is going to pay the cost?"

About 30 ammonia cracking projects have been announced globally, most of which are in the early stages, said Matthew Hodgkinson, senior hydrogen analyst at Commodity Insights.

"The projects that are in the advanced stages of development are generally smaller-scale or pilot studies, with developers aiming to scale up by the end of the decade," Hodgkinson said. "Germany has the highest number of announced ammonia cracking projects thus far, as imports are expected to play a key role in the nation's long-term vision for low-carbon hydrogen."

Siemens, FFI, and GeoPura collaborated to develop a prototype in the UK that aims to produce 200 kg of hydrogen per day. Uniper and Thyssenkrupp recently announced that construction has commenced on a "demo" ammonia cracker in Gelsenkirchen-Scholven that can process 28 mt/day of ammonia.

Hodgkinson added that public funding commitments toward ammonia cracking have been relatively small-scale, with the majority of funding commitments to the low-carbon hydrogen sector being directed toward revenue support schemes.

One of the largest commitments in terms of infrastructure funding is the European Innovation Fund's Eur110 million grant for Air Liquide's Enhance project at the port of Antwerp-Bruges in Belgium, although the facility is not expected to be operational until 2029.