TEA breakdown: green ammonia and synthetic methane

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Nov 21, 2024

Shayle talks with Melissa Ball, an associate director at EIP specializing in climate technologies, and Greg Thiel, EIP's technology director. They delve into green ammonia and synthetic methane production, discussing the economic hurdles they face. Key topics include innovative methods for ammonia synthesis and the critical role of transportation costs. They analyze how to integrate renewable energy into these processes and explore decentralized production methods. Their insights highlight the need for cost reductions to boost the competitiveness of these emerging technologies.

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INSIGHT

Techno-Economic Analysis Importance

A solid techno-economic analysis (TEA) is crucial for startups to model how technology competes in the real world. Bad assumptions and false precision often lead to failures in TEA.

INSIGHT

Ammonia Production's Carbon Footprint

The majority of greenhouse gas emissions from ammonia production come from hydrogen sourced through steam methane reforming. This highlights the need for cleaner hydrogen sources to reduce emissions.

ADVICE

Consider Hydrogen Storage Costs

Plan for hydrogen storage costs in ammonia production, as they can significantly impact the levelized cost of ammonia. Effective hydrogen management is crucial for cost competitiveness.

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Shayle and his team at Energy Impact Partners (EIP) review a lot of climate-tech pitches. The best kind of pitch uses a solid techno-economic analysis (TEA) to model how a technology would compete in the real world. In a previous episode, we covered some of the ways startups get TEAs wrong — bad assumptions, false precision, focusing on parts instead of the system, etc.

So what does a good TEA look like?

In this episode, Shayle talks to his colleagues, Dr. Melissa Ball, EIP’s associate director of technology, and Dr. Greg Thiel, director of technology. They apply their TEA chops to two technology pathways — green ammonia and synthetic methane. EIP hasn’t invested in either area yet because both struggle with challenging economics. Shayle, Greg, and Melissa talk about what would have to change to make those economics work, covering topics like:

The basics of ammonia and methane production
The cost stack of ammonia production and the surprisingly large role transportation plays
The challenges of integrating ammonia production with renewables, like buffering hydrogen
Novel approaches to ammonia synthesis, including scaling down the existing process, lower temperature, and pressure

Recommended resources

U.S. Department of Energy: Clean Hydrogen Commercial Liftoff

Catalyst: Ammonia: The beer of decarbonization

Catalyst: Climate tech startups need strong techno-economic analysis

Catalyst is brought to you by EnergyHub. EnergyHub is working with more than 70 utilities across North America to help scale VPP programs to manage load growth, maximize the value of renewables, and deliver flexibility at every level of the grid. To learn more about their Edge DERMS platform and services, go to energyhub.com.

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