Ammonia is an essential nutrient for global food production brought to farmers by a well-established supply chain. This article introduces a supply chain optimization framework which incorporates new renewable ammonia plants into the conventional ammonia supply chain. Both economic and environmental objectives are considered. The framework is then applied to two separate case studies analyzing the supply chains of Minnesota and Iowa, respectively. The base case results present an expected trade-off between cost, which favors purchasing ammonia from conventional plants, and emissions, which favor building distributed renewable ammonia plants. Further analysis of this trade-off shows that a carbon tax above $25/t will reduce emissions in the optimal supply chain through building large renewable plants. The importance of scale is emphasized through a Monte Carlo sensitivity analysis, as the largest scale renewable plants are selected most often in the optimal supply chain.
- distributed ammonia production
- green fertilizer
- supply chain optimization
- wind power