Cost competitiveness of green ammonia via solid oxide electrolysis in Europe: A region-specific analysis

Ammonia is a vital commodity for both agriculture and industry, with global demand projected to exceed 680 million tonnes annually by 2050. However, conventional ammonia production via the Haber-Bosch process, which relies on fossil-derived hydrogen, is highly carbon intensive. Decarbonising ammonia production is therefore essential to achieve net-zero targets and reduce fossil fuel dependency. This study develops a comprehensive Mixed Integer Linear Programming model to optimise green ammonia production across Europe based on high-efficiency solid oxide electrolysis. The model incorporates a detailed efficiency curve of the electrolyser together with its specific thermal requirements, effectively capturing operational synergies between the electrolysis system and the Haber-Bosch reactor through integrated heat management. The analysis evaluates the optimal Levelised Cost Of Ammonia (LCOA) under different configurations – islanded and grid-connected – highlighting the implications of the revised EU Renewable Energy Directive (RED III) on renewable energy use, system design and costs. The results identify regions with high wind potential (e.g., northern France, Denmark, England) as the most cost-competitive for ammonia production, achieving LCOA values of around 1000 €/tNH3. These regions benefit from higher average capacity factors and better temporal alignment between renewable generation and plant electricity demand compared to solar-dominated regions. In contrast, areas with limited wind resources and high solar availability, such as southern Europe, are less competitive, with LCOA values exceeding 1800 €/tNH3, mainly due to the day-night shift in energy production. Grid electricity integration is shown to reduce costs by enabling the downsizing of both storage systems and renewable generation capacity; however, it also introduces additional variability related to local grid electricity prices and carbon intensity. Overall, this work provides actionable insights for the development of cost-effective, region-specific green ammonia plants, supporting the transition towards sustainable ammonia production in line with European energy and climate goals.