Ammonia Production as Alternative Energy for the Baltic Sea Region

Gunnar Prause (), Eunice O. Olaniyi and Wolfgang Gerstlberger
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Gunnar Prause: School of Business and Governance, Tallinn University of Technology, Akadeemia tee 3, 12618 Tallinn, Estonia
Eunice O. Olaniyi: Department of Geography and Geology, University of Turku, 20014 Turku, Finland
Wolfgang Gerstlberger: School of Business and Governance, Tallinn University of Technology, Akadeemia tee 3, 12618 Tallinn, Estonia

Energies, 2023, vol. 16, issue 4, 1-17

Abstract: One of the consequences of the conflict in Ukraine relates to the growing shortfall in global ammonia production. There are additional negative global impacts on the availability of fertilizers and prices of ammonia (NH 3 ). The shortage in ammonia production does not only influence the agroindustry but also the global shipping industry, as ammonia is positioned as a promising zero-carbon fuel and as a storage and transport medium for hydrogen. There are plans underway to start ammonia production in Estonia to minimize the consequences of the import stop of Russian ammonia in the context of the Ukrainian crisis. This study investigated the Baltic Sea Region (BSR) ammonia market and analyzed the economic implications of building an ammonia plant within the BSR. Using fuzzy real options models as the conceptual framework, together with secondary data analysis, case studies and expert interviews, the authors chart possible courses for the construction of ammonia production facilities within the region. Based on the case of the NH 3 production plant, as well as the underlying distribution system, the study provides new economic perspectives for lower carbonization for the shipping industry, an attempt at creating a model for other European regions toward climate change mitigation.

Keywords: ammonia; non-fossil fuel; decarbonization; green energy; Baltic Sea Region; investment evaluation; fuzzy options; real options theory (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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