Decarbonising Europe's ammonia industry: Economic feasibility, policy constraints, and trade competition

Abdurahman Alsulaiman; Chi Kong Chyong; Henrik Schmidt

doi:10.1016/j.esr.2026.102131

February 20, 2026Energy Strategy ReviewsOpen Access

Decarbonising Europe's ammonia industry: Economic feasibility, policy constraints, and trade competition

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Key Points

This research aims to evaluate the economic feasibility of decarbonising Europe's ammonia industry while identifying policy constraints and competitive dynamics.
Analyzed current energy source costs for ammonia production
Assessed the impact of policy scenarios on renewable energy adoption
Evaluated economic implications of time-matching rules for ammonia projects
Examined potential US competition in the ammonia market with BIOH2/CCS
Steam Methane Reforming (SMR) remains the cheapest option under current policies.
Increased support for renewables improves their feasibility and emissions performance.
Time-matching rules negatively affect project value, while monthly matching enhances economics.
US ammonia production methods may challenge EU supply viability, raising carbon accounting issues.

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Implication

Economic analysis highlights decarbonisation strategies in the ammonia industry, suggesting flexible policy support is crucial.

Abstract

• SMR remains cheapest under current policies; renewables gain under stronger policy support. • Time-matching rules cut project value; monthly matching improves economics and emissions. • US BIOH 2 /CCS ammonia may outcompete EU supply, raising carbon accounting concerns. • Policy support must be tech-neutral, with flexible rules and coordinated infrastructure.

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Alsulaiman et al. (2026) studied this question.

synapsesocial.com/papers/699bee1c1c6c6bad5397fe51 https://doi.org/10.1016/j.esr.2026.102131

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Decarbonising Europe's ammonia industry: Economic feasibility, policy constraints, and trade competition

Key Points

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Implication

Abstract

Discussion

Cite This Study

Decarbonising Europe's ammonia industry: Economic feasibility, policy constraints, and trade competition

Key Points

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Implication

Abstract

Discussion

Cite This Study

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