Decarbonizing the Fertilizer Production Sector Requires Flexibility in Technology, Timelines and Government Collaboration, Says New Study from Fertilizer Canada  

FOR IMMEDIATE RELEASE

Ottawa, ON, October 17, 2023 – Today, Fertilizer Canada, with financial support from Natural Resources Canada, released a technology roadmap study, GHG Emission Reductions in the Canadian Fertilizer Production Sector, that looks at five promising technologies that would make meaningful reductions in greenhouse gas (GHG) emissions from ammonia and potash production. Fertilizer Canada proactively commissioned the report to determine timelines, costs, and feasibility of technologies to work in collaboration with government and inform policies and incentives that support the industry and Canada’s emission reduction goals.

The report found that the variations in types of fertilizer produced, production methods used, and location of the facility require flexibility in technology solutions. The five technologies addressed in the study were Carbon, Capture, Utilization and Storage (CCUS), hydrogen production through electrolysis, Small Modular Reactors (SMR), Cogeneration, and electrification of mining fleets. According to the report, SMRs have the greatest potential for GHG emission reductions for the potash sector, but it is not yet commercially available and requires a significant investment to be developed at the scale needed. A combination of electrolysis to produce hydrogen and CCUS used with steam methane reformers have the greatest potential for GHG emission reductions for ammonia production.

Canada’s fertilizer manufacturers and producers have been investing in decarbonization technologies for decades and continue to, but adoption of technologies with 50 per cent reduction of GHG emissions or greater will require at least five to ten years to implement and could cost upwards of $1 billion per facility based on similar publicly announced projects.

Fertilizer production is energy-intensive, and as a globally traded commodity Canada’s fertilizer sector must balance reducing emissions and remaining competitive with countries who don’t face the same environmental policies and regulatory barriers, such as Russia and China. Canada provides farmers with sustainably produced fertilizer and our industry is committed to working with government to develop and strengthen policies and regulations that incentivize investment and safeguard against production moving to other jurisdictions that don’t face the same climate policies. Protecting domestic production of sustainable Canadian fertilizer defends against carbon leakage that could increase global GHG emissions.

“The Technology Roadmap showcases technologies which will result in a significant reduction in GHG emissions, however it cannot be viewed as a one size fits all approach,” says Karen Proud, President and CEO, Fertilizer Canada. “Companies will need to assess what technologies align best with their facilities and what are commercially available. However, together with governments we can help to create a regulatory environment which balances both the economic and environmental goals of our member companies and Canada.” 

The ability for the fertilizer production sector to decarbonize also relies heavily on investments in infrastructure outside our fence-line including access to a clean, affordable, reliable electricity grid and CO₂ pipelines for CCUS.

Based on the results of the study we believe federal and provincial governments should consider the following:

• Provide federal and provincial regulatory certainty and long-term commitments that promote investments in decarbonization technology, along with targeted programs and investment tax credits that reflect the cost for these technologies. As well as look to other jurisdictions when developing policies and funding mechanisms to emulate their success, ensure Canada is competitive, and protect domestic fertilizer production.
• All levels of government work in collaboration with industry to ensure policies reflect realistic timelines for the wide commercial adoption of decarbonization technologies and adjust funding programs to support technology at early stages of development such as feasibility and engineering level studies. As well as clarify and simplify regulatory approvals to expedite technology readiness.
• Work with industry and stakeholders to build out infrastructure our industry depends on beyond our fence-line to make reductions in GHG emissions, such as CO₂ pipelines and a reliable, affordable, clean electricity grid.

Fertilizer Facts:

• Potash is a mineral used for potassium fertilizer that is extracted through conventional or solution mining. Canadian potash is produced with approximately 50 per cent lower GHG intensity compared to global competitors. Extraction of potash through traditional mining represents 15 per cent of potash production emissions and solution mining represents 24 per cent of potash production emissions.
• Nitrogen ammonia production is an energy-intensive process that takes nitrogen from the air and combines it with hydrogen to create ammonia fertilizer. Ammonia process emissions represent 64 per cent of total generated emissions, which are fixed by the chemical process and cannot be reduced, but they can be used for other beneficial processes, such as urea production or sale to specialty gas suppliers and third-party liquefaction facilities. Canadian ammonia is produced with at least 30 per cent lower net GHG emissions intensity compared to global competitors.
• Fertilizer is vital to food security and responsible for half of the world’s current food production. Canada supplies approximately 12 per cent of global fertilizer.

Additional Resources:

• Technology Roadmap Study Report: GHG Emission Reductions in the Canadian Fertilizer Production Sector
• Technology Roadmap Study Report: GHG Emission Reductions in the Canadian Fertilizer Production Sector – Brief
• Ammonia Production Greenhouse Gas Emissions Benchmarking
• Ammonia Production Greenhouse Gas Emissions Benchmarking – Brief

About Fertilizer Canada:

Fertilizer Canada represents manufacturers, producers, wholesale and retail distributors of nitrogen, phosphate, potash and sulphur fertilizers. The fertilizer industry plays an essential role in Canada’s economy and is committed to supporting the industry through innovation, sustainability, stewardship, safety and security. As the foundation of Canada’s agri-food sector, we apply innovative solutions that positively impact the environment, the economy, and the social fabrics of Canadian life.

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Contact information:

Kayla FitzPatrick

Director of Communications, Fertilizer Canada

[email protected]

(613)979-8723