Synthetic ammonia is arguably the most impactful invention of the 20th century. Without it as fertiliser, we would only have been able to sustain about half of the global population. The downside, however, is that (grey) ammonia production comes with greenhouse gas emissions: about 500 Mt CO2e per year globally.
Nevertheless, the ammonia demand has been predicted to increase in the coming decades through its use as fertiliser, hydrogen carrier, and sustainable fuel in the maritime industry. The International Renewable Energy Agency (IRENA) estimates that by 2050, the total ammonia market will be about four times as big as it is today. Keeping the two additional use cases in mind as well as the Net Zero targets, it becomes a lucrative investment opportunity and we simply cannot ignore green ammonia anymore.
Although that sounds promising, only tiny amounts of green ammonia are actually being produced at the moment. This is exactly why green ammonia is such an interesting space for venture capital funding: a market with huge potential that requires cash influx to flourish.
So how does a venture capital fund, like Extantia Capital, look at green ammonia? We will present the findings of our deep dive at the NH3 event, including our general investment criteria and a (startup) market analysis.