The cost of green ammonia is usually calculated by considering both capital expenditure and operating expenditure.

Capital expenditure, or CAPEX, may include process equipment, modular skids, storage systems, electrical systems, civil works, installation, logistics, engineering, and project management. Operating expenditure, or OPEX, may include electricity, water, catalyst, maintenance, labor, utilities, consumables, and periodic replacement costs.

A common method for evaluating green ammonia cost is the Levelized Cost of Ammonia, often referred to as LCOA or LOCA. This method estimates the average cost of ammonia production over the lifetime of the project. In addition to CAPEX and OPEX, the calculation should also consider annual operating hours, plant load factor, equipment lifetime, financing assumptions, and expected ammonia output.

For small-scale green ammonia projects, the cost should not be evaluated only as a production cost per ton. Developers should also consider the value of local production, avoided transport costs, supply security, renewable energy utilization, carbon reduction, and potential downstream benefits.

Project developers can use KAPSOM’s online LOCA calculator as a starting point to estimate green ammonia production cost and assess project feasibility. A more detailed cost analysis should be based on site-specific data, including electricity price, operating schedule, capacity, local construction cost, logistics, storage requirements, and downstream application.