the cost of carbon- intensive production. With carbon prices exceeding €80-90 per metric ton of CO₂ and free allowances set to diminish, legacy ammonia plants face mounting compliance costs. Notably, the CBAM transitional phase (2023-2025), during which importers
€500
120%
2.8t/t
97.5 95
100%
90
€400
2.0t/t
77.5
80%
€300
60%
51.5
1.6t/t
€200
39
40%
26.5
€100
14
20%
0
€0
0%
2026 2027 2028 2029 2030 2031 2032 2033 2034
CBAM factor
Gr e y NH -2.8 t CO /t-Default
Gr e y NH CO -2.0 t/t
Gr e y NH CO -1.6 t/t EUA price = 90-180 €/T CO
reported embedded emissions without financial settlement, concluded at the end of 2025. As of 1 January 2026, the definitive CBAM regime has entered into force, requiring importers of ammonia to purchase and surrender CBAM certificates reflecting the verified carbon intensity of their product. This marks the beginning of full carbon-cost convergence between domestic EU producers subject to the ETS and extra-EU suppliers exposed to CBAM. As illustrated in Figure 4 , the economic impact of the definitive CBAM regime becomes substantial as both the carbon price and the CBAM phase-in factor increase. Figure 4 assumes an EUA price trajectory rising from €90/t CO₂ in 2026 to €180/t CO₂ by 2034, applied across three representative ammonia carbon intensities: 2.8, 2.0, and 1.6 t CO₂/t NH₃. Under these assumptions, high-emission ammonia imports face CBAM liabilities exceeding €400/t NH₃ by 2034, while cleaner imports incur proportionally lower charges. This widening differential strengthens the competitiveness of deeply decarbonised European ammonia facilities relative to grey imports. Simultaneously, the expansion of hydrogen infrastructure, including the EHB, is improving access to low-carbon hydrogen at scale. These developments, combined with funding mechanisms such as the EU Innovation Fund and national-level incentives, significantly enhance the financial viability of clean ammonia projects. In this context, the studied facility’s transition Blue ammonia-0.1 t/t
CBAM factor (% )
Figure 4 CBAM pricing
to clean hydrogen feedstock – sourced from both OTF gasification and the EHB pipeline – offers a compelling long-term business case. The project has already advanced into the detailed engineering phase, supported by “ The economic impact of the definitive CBAM regime becomes substantial as both the carbon price and the CBAM phase-in factor increase ” favourable policy alignment, infrastructure readiness, and a clear pathway to mitigate carbon risk and achieve market differentiation. Case 2: Green hydrogen and oxygen integration to debottleneck a new US facility This US-based ammonia plant, operating at approximately 2,800 stpd (~115% of nameplate capacity), features a modern configuration that includes a cryogenic purifier for removing inert gases and excess nitrogen from the syngas stream. During the initial evaluation, KPI identified several systems operating beyond their design limits – most notably the cryogenic purifier and the arch burners. Overfiring of the arch burners posed a reliability risk to the radiant tubes. At the same time, the overloaded cryogenic purifier resulted in increased purge gas losses to the fuel system, thereby reducing overall energy efficiency.
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