JERA, Japan’s largest thermal power generation firm, iscollaborating with CF Industries , a major US fertilizer ammonia producer, to build ammonia production and relevant facilities in the US, as reported by Nikkei Asia on March 23. The partnership builds on a memorandum of understanding (MoU) inked between the two firms in 2023. The two companies plan to begin the design and construction of an ammonia manufacturing plant within a year at a potential site in the southern US. They aim to produce 1 million tons of ammonia annually, with half of the output going to JERA. This will help meet JERA’s target of importing 2 million tons of ammonia per year by 2030, which it will use for clean-burning power generation in Japan. Aside from JERA, Japanese energy firm Inpex has also announced plans to produce 1.1 million tons of ammonia annually in Houston by 2027.

Last week, JERA and Japanese engineering company IHI announced a pilot program to co-fire 20% of ammonia with coal at JERA’s Hekinan thermal power station in Aichi prefecture, central Japan. The program marked the world’s first attempt to adopt a large amount of ammonia at a major commercial power plant for decarbonization. To achieve a large-scale and cheap supply of ammonia, JERA chose to establish ammonia production sites in the US, where it can benefit from the lucrative tax credits provided by the Inflation Reduction Act (IRA). Inpex President, Takayuki Ueda, said these incentives enable the company to produce ammonia at the same cost as in the Mideast.

Sources:

https://asia.nikkei.com/Business/Energy/Japan-s-JERA-and-Inpex-to-invest-in-U.S.-ammonia-projects

https://www.reuters.com/markets/commodities/jera-conduct-trial-co-firing-ammonia-coal-power-plant-march-june-2024-03-13/