Green ammonia set to dominate heavy industry’s planned green hydrogen use

More than 70% of the planned green hydrogen use in heavy industrial projects tracked globally will be dedicated to ammonia production, according to a report released by Mission Possible Partnership (MPP), a Washington-based nonprofit.

The study, titled Clean industry: transformational trends, outlines that as of April 30 this year, 372 announced clean ammonia projects worldwide were in progress. If completed, these projects would collectively produce about 274 million tonnes of ammonia annually, surpassing the global capacity for traditional “grey ammonia,” which is derived from natural gas without carbon capture.

Of these planned projects, two-thirds would rely on green hydrogen—produced using renewable-powered electrolysis—while the remaining third would use blue hydrogen, derived from natural gas combined with carbon capture and storage (CCS). Approximately 77% of the proposed clean ammonia production would be green, with the remaining 23% blue.

However, the report warns that fewer than 5% of these planned projects, representing roughly 16 million tonnes per year, have reached a final investment decision. Additionally, fewer than 10% have secured offtake agreements.

Most clean ammonia projects are concentrated in China, the United States, and the Middle East, with Chinese projects anticipated to begin production as early as 2025–2026. Emerging markets in sunbelt economies—particularly India, Egypt, Chile, and Brazil—now account for half of the global clean ammonia pipeline capacity.

The United States and the Middle East and North Africa (MENA) region are driving the growth of blue ammonia projects, buoyed by the availability of affordable natural gas and suitable carbon storage sites. Policy incentives such as the U.S. Inflation Reduction Act’s 45Q tax credits and Europe’s Renewable Energy Directive (RED III) are accelerating these projects, though high capital costs, securing offtake, and limited renewable energy capacity could constrain their development.

Europe and China are identified as major future consumers of clean ammonia, predominantly for fertilizer and industrial applications. Despite this momentum, the report emphasizes that methanol—not ammonia—will dominate the clean shipping sector due to technological maturity and fewer safety concerns, at least through the 2030s.

Nevertheless, short-term maritime demand for ammonia is forecasted to reach approximately 20 million tonnes annually by 2030, double the anticipated demand for methanol, despite fewer ammonia-capable ships currently ordered.

The Mission Possible Partnership includes partners such as the Energy Transitions Commission, RMI, We Mean Business Coalition, and the World Economic Forum. The Industrial Transition Accelerator, co-chaired by COP28 president Sultan Al Jaber, Michael Bloomberg, and UN climate executive Simon Stiell, collaborated with MPP on the report.