Coal is at the centre of Australia and Japan’s long partnership in energy trade. This relationship will change as Japan seeks to reduce its emissions over the next decades.
Japan wants to be net-zero in greenhouse gas emissions by 2050. Japan has a plan to achieve this goal. In coal-fired power plants, you can also burn combust and ammonia..
Ammonia is created by combining nitrogen and hydrogen. When ammonia is burned for energy, the process does not produce carbon dioxide (CO₂), and so offers potential for Japan to reduce greenhouse gas emissions.
Australia is well placed for a global supply of ammonia. But the climate gains from Japan’s shift will depend on how the ammonia is produced in Australia.
A new way to run coal plants
The value of Australia’s thermal coal exports to Japan reached about A$7 Billion in 2020 – 40% of the total value of our thermal coal exports that year.
Japan aims to achieve net-zero greenhouse gases emissions by 2050. To achieve this goal, Japan has pledged to reduce its greenhouse gas emissions by 46% in 2030 compared with 2013.
Japan is working to reduce its energy emissions. Reduce inefficient coal plants. In addition, it’s moving to burn ammonia alongside coal in remaining plants.
Large pilot trials in Japan have shown the feasibility of a coal-burning mix with 20% ammonia. Japan’s biggest power plant operator, JERA, Is it time to invest?In a project to prove the feasibility of a 50% mix of ammonia and water. The Japanese government is Contributing to a fundThe project.
It doesn’t matter how ammonia was made
Whether using ammonia helps tackle climate change depends on how it’s made.
Currently, ammonia is produced on an industrial scale by combining hydrogen and nitrogen using the so-called “Haber Bosch” process. Today, hydrogen is usually produced from gas using a process that releases a lot of CO₂.
You can also make hydrogen with electrolysis Renewable electricity is used to power the generator – creating what’s known as “green” hydrogen. This process is currently more costly than the gas method.
When renewable energy is used to power processes that extract nitrogen and combine it with hydrogen, ammonia can be made with near-zero emissions intensity.
Australia’s abundant energy resources, and existing trade relationships, mean it could become a major supplier of ammonia to countries decarbonising their energy sources.
Mostly, ammonia in Australia is made from fossil fuels. This It was a success.2 million tonnes of greenhouse gas emission in 2019.
Projects to make ammonia GasThese are areas where carbon emissions can be captured and stored are also being created.
Will Japan’s plan help the climate?
Japan can reduce its national emissions by burning ammonia in its coal-fired power plants. We Calculate that replacing 20% of the coal burned in Japan’s expected 2030 coal fleet with ammonia would avoid emitting 40 million tonnes of CO₂ a year.
What happens if Japan burns ammonia produced in Australia from fossil fuel-based hydrogen? In that scenario, Japan’s emission savings will be overtaken by the Australian emissions when the ammonia is produced. Emissions would simply transfer between nations without any benefit to the planet.
Carbon capture and storage (CCS) could reduce some emissions from Australia. However, this technology is not feasible. And significant CO₂ would still be released to the atmosphere in Australia due to fugitive emissions – those that escape during the production process – and because CCS doesn’t capture all CO₂.
So clearly, only ammonia production powered by renewable energy will reduce CO₂ emissions in both Japan and Australia.
It’s worth noting that under the scenario outlined above, the reduction in our thermal coal exports to Japan would lead to a fall in fugitive emissions from coal mining in Australia.
We expect a reduction of fugitive emissions between 1 and 10,000,000 tonnes per year by 2030, assuming a one-to-1 reduction in coal exports from Japan. This would offset the emissions from installing renewable energy to power clean ammonia production in Australia.
What to do
Japan is not obligated to purchase ammonia with zero emissions from Australia under the current global system for national emissions reporting.
If international ammonia trade increases, national governments will need to adopt policies to reduce ammonia emissions from the supply chain.
In Australia, that could mean a tougher national emissions target – and a detailed roadmap laying out how to get there – to make it harder for businesses to invest in new polluting ammonia production.
But this won’t stop Japan’s power plant operators from buying emissions-intensive ammonia from other countries if it’s cheaper. It is clear that international cooperation is necessary.
This could be in the form certification, similar to what is currently being done. DevelopedHydrogen. For ammonia, certification would be Tell consumersHow much greenhouse gas was emitted during production.
Incentives must be put in place to ensure that buyers select low-emission ammonia. This may involve transferring emission reductions from one country’s greenhouse gas ledger to another – a Mechanism discussedAt the recent COP26 climate conference held in Glasgow.
Japan may be able use ammonia in order to reduce the environmental impact from its coal power fleet. But, the victory is unlikely unless ammonia can be produced with very little or no emissions.