Japan's JERA eyes up to 500,000 mt/year ammonia long-term supply from FY 2027-28

Japan's largest power generation company JERA said Feb. 18 it plans to issue international tenders to buy up to 500,000 mt/year of fuel ammonia from long-term contracts starting in fiscal year 2027-28 (April-March).

JERA said it has sent a request for proposals describing bidding conditions to more than 30 companies for the FOB-based long-term supply over FY 2027-28 until the 2040s.

In its request to potential suppliers, JERA placed conditions for potential ammonia suppliers such as CO2 is either not emitted during ammonia production or is captured and stored; as well as providing JERA opportunity to participate in production projects.

JERA's move for fuel ammonia procurement comes as it is working on a project to demonstrate the use of fuel ammonia at the Hekinan thermal power plant, aiming to switch 20% of the fuel at the 1 GW No. 4 coal-fired unit to ammonia by the late 2020s.

In January, JERA said it plans to start co-burning more than 50% of ammonia together with coal at its Hekinan thermal power plant in central Japan by fiscal year 2028-29 (April-March) following completion of a pilot project.

JERA, which has secured a grant from state-owned New Energy and Industrial Technology Development Organization, or NEDO, with IHI, will develop a new ammonia co-firing burner and install it at its Hekinan No. 4 or No. 5 coal-fired units, each with a 1 GW capacity to raise co-burning volumes of ammonia to more than 50% during an eight-year project to FY 2028-29.

The latest project came as JERA is already in the middle of 20% co-firing of ammonia at its No. 4 Hekinan coal-fired unit under another NEDO-funded project, under which it plans to procure 30,000-40,000 mt of ammonia by FY 2024-25.

In a separate development, JERA also said in January that it has also secured another NEDO grant with Mitsubishi Heavy Industries to develop an ammonia single-fuel burner suitable for coal-fired boilers and to demonstrate operation of the burner at actual boilers in a demonstration project until FY 2028-29.

JERA and MHI will develop a new burner capable of single-fuel ammonia combustion and draw up a master plan for equipment by FY 2024-25 to demonstrate its use in actual boilers, with verification of co-firing with at least 50% ammonia at two units with different boiler types by FY 2028-29.

JERA has pledged to commercialize its ammonia co-burning power generation by 2030 as part of its aim to start using 100% ammonia as a fuel in the 2040s for its 2050 carbon neutrality target.

Japan sees great potential in fuel ammonia as a CO2 zero-emission fuel as the country aims to cut its greenhouse gas emissions by 46% by FY 2030-31 from the FY 2013-14 level and achieve 2050 carbon neutrality.

Japan currently estimates fuel ammonia demand for power generation at 3 million mt/year in 2030 and expects it to grow to 30 million mt/year in 2050, equivalent to 1.5 times the current international trade of ammonia as a fertilizer, according to the Ministry of Economy, Trade and Industry.

Under the Strategic Energy Plan formulated in October, Japan intends to introduce 1% of hydrogen/ammonia in its power generation fuel mix by FY 2030-31, when it also aims to introduce 30% co-burning of hydrogen at gas-fired power plants or mono-burning of hydrogen for power generation, as well as 20% co-burning of ammonia at coal-fired power plants.