Global Nitrogen Innovation Center for Clean Energy and the Environment

Green ammonia offers the potential to decarbonize fertilizer production, but several economic, technical, and policy challenges complicate its adoption at the farm level. Green ammonia production technology remains capital-intensive, ranging from 1-5 million USD for 1-2 tons of ammonia production per day, and depends on reliable access to renewable energy. Different financial models, such as co-ops or long-term offtake agreements, can alleviate this barrier. An example of this is seen between TalusAg and Landus. Landus is an Iowa-based farmer cooperative that entered a fixed-price offtake agreement for a commercial green ammonia installation from TalusAg with a corresponding production capacity of about 300-600 tonnes per year.

Economies of scale often favor large industrial producers, and smaller agricultural stakeholders can face steeper financial barriers to entry for new technologies. Uncertainty and perceived risks of technology performance and long-term economic returns can also deter green ammonia adoption, particularly for small and mid-sized farms. Without targeted support, these dynamics could exacerbate existing inequities in the agriculture sector by accelerating farm consolidation, as larger operators with greater capital access could scale faster than smallholders. Over time, this could deepen structural inequalities, reducing rural employment opportunities and threatening local livelihoods.

The current main product of the green ammonia distributed unit is anhydrous ammonia, which is highly concentrated ammonia stored under pressure. Anhydrous ammonia is used on-farm in some parts of the US, mostly in the Midwestern corn belt, and accounts for about 24% of total nitrogen fertilizer use nationally. Farmers without the infrastructure to store and use anhydrous ammonia would incur significant additional expenses to adopt its use. Safety concerns related to anhydrous ammonia must also be considered for on-farm adoption. Anhydrous ammonia is hazardous to manage, as even minor skin or respiratory exposure carries health risks, and it requires specialized storage and application equipment. Experience handling anhydrous grey ammonia should be transferable to anhydrous green ammonia, but local production and storage add some additional challenges.

Green ammonia can also be solubilized in water, known as aqua ammonia. Aqua ammonia is not widely used by farmers today, but because it is a liquid, it might be feasible for farmers to adopt in lieu of other forms of liquid fertilizers currently in use (e.g., urea ammonium nitrate, or UAN). Research is needed to determine if green aqua-ammonia could be applied with the same equipment widely used to apply UAN and other forms of nitrogen fertilizer. Converting green ammonia into other fertilizer forms would add complexity and expense at small scales, and on-site conversion using distributed units is largely in the development phase.

Environmental impacts also persist despite decarbonized production. Fertilizer use, regardless of production method, contributes to emissions of nitrous oxide and nutrient leaching from croplands. Increased fertilizer access and potentially reduced costs from on-farm green ammonia production could unintentionally drive higher total nitrogen use, particularly in unregulated regions like the U.S. Midwest, and even in regulated areas, it could incentivize expansion of nitrogen-intensive crops such as corn. These dynamics could heighten regional nitrogen losses and lead to unforeseen risks and environmental hazards. On the other hand, green ammonia fertilizers produced on-farm, year-round, could also allow farmers to time their fertilizer applications to more effectively match crop demands, which could increase efficiencies and reduce nitrogen losses. Research and on-farm experience will be needed to guide optimal use of green ammonia as it becomes more available.