Revolutionizing ammonia production

The Nobel-prize winning discovery of how to create synthetic ammonia has been called the “most momentous technical advance in history,” and for good reason. Today about half of the food consumed worldwide comes from the increased harvest yields resulting from ammonia-based fertilizers. We could not sustain the global population without it.

While ammonia production is critical to modern day global food security, and will need to increase to support a growing population, it is also extremely energy- and emissions-intensive. Ammonia produces twice as much CO2 per metric ton of product than steel, 4 times as much as cement, and accounts for ~2% of global emissions. 

Talus Renewables is among a growing number of companies working to change that by creating fossil-fuel free “green ammonia,” and they are the first to have deployed their product in the market. The company provides modular, small-scale ammonia production facilities that can be shipped to remote growing regions and allow farms or groups of farms to produce their own fertilizer using clean energy. Climate Now sat down with Talus Renewables co-founder, Hiro Iwanaga, to discuss how this production system reduces complex supply chain and transportation costs as well as emissions, and how it is helping improve global food security and sustainable agriculture at the same time.

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Chapters

• 0:00 Introduction and This Week in Climate News
• 13:35 Why Ammonia
• 15:15 The Origins of Talus
• 19:13 The Market for Green Ammonia
• 26:31 Risks

Transcript

James Lawler: [00:00:00] Welcome to Climate Now, I'm your host James Lawler, and today we're talking about the production of ammonia, which is one of the most critical chemicals that humanity manufactures, and one company that's working to decarbonize ammonia production while revolutionizing ammonia's supply chain to make it cheaper, more accessible, and far less carbon intensive.

First, a little bit of background about why you should care about ammonia. So, while most people may not realize it, ammonia is central to our modern way of life. About 80% of all ammonia that is produced is used as fertilizer, which is used to grow 50% of the world's food, according to the American Chemical Society.

Carnegie Science researchers found that in 2019, food grown thanks to ammonia fed over 3.8 billion people on planet Earth. Without ammonia production, most of us wouldn't be here today. So, to understand how ammonia became so important, we need to [00:01:00] understand why and how it was invented in the first place.

Let's start with the basics of plant growth. So plants require a variety of nutrients to grow. One of them is nitrogen. However, plants are unable to process nitrogen, which is a gas that forms 78% of the Earth's atmosphere, all by themselves. So they rely on bacteria in the ground to transform nitrogen and break it down into ammonia, a process called nitrogen fixation.

This process, however, has its limits. For centuries, humans have used a variety of additional fertilizers to fuel plant growth, such as livestock manure and highly prized guano, which is bird and bat feces. As Western medicine and scientific advancement in the 19th century progressed, farmers were faced with a growing problem; they didn't have enough fertilizer to feed growing populations. 

Enter two German chemists Fritz Haber and Carl Bosch. In 1908, they developed a chemical process to manufacture ammonia that changed the world. The Haber-Bosch process as it came to be known [00:02:00] combines hydrogen and nitrogen in a catalyst at high pressure to form ammonia, which is then stored in liquid form and can be eventually directly injected into soils by farmers where it reacts with water and super fuels plant growth.

The hydrogen that's needed for the Haber Bosch process is most often produced in a process called steam methane reforming, where methane, or natural gas, is mixed with steam and a catalyst, which then produces hydrogen as well as releases carbon dioxide and carbon monoxide. So traditional ammonia production is highly carbon intensive.

The global production of ammonia is about 183 million tons per year, with 80% of that going towards synthetic nitrogen fertilizers. and 20% towards plastics[AM1] , explosives, and textile production. A 2020 Royal Society report found that producing those 183 million tons of ammonia every year requires about 2% of the planet's total energy output.

A 2021 IEA report [00:03:00] calculated that for each ton of ammonia produced, about 2. 4 tons of CO2 are emitted, which means that the total yearly annual ammonia production is responsible for about 450 million tons of CO2 every year. This, the Royal Society report found, makes ammonia production the largest carbon dioxide emitting chemical industrial process in the world.

Finally, a 2021 EIA study reported that 98% of ammonia plants around the world use fossil fuels as a feedstock. Primarily natural gas, about 72% of them, and coal, 22%. Meaning that for the majority of its supply chain, the Haber-Bosch process that creates the world's ammonia supply relies on dirty fossil fuels.

Adding to ammonia's carbon footprint is the fact that ammonia production is unevenly distributed around the world, with China being the largest producer of ammonia, accounting for 30% of production. The United States, the European Union, India, Russia, and the Middle East account for a further 8 10% each, [00:04:00] according to the IEA study.

With 10% of ammonia production traded around the world, that means around 18 million tons of ammonia need to be transported on fossil fueled vehicles such as ships, trucks, and trains. While emissions for the transport part of the ammonia supply chain aren't fully understood, they aren't insignificant.

Decarbonizing ammonia means not only changing the feed source from fossil fuels to something else, but also reducing or eliminating emissions from its transportation. Enter Talus Renewables, which is a company that's dedicated to solving ammonia's carbon problem and making the critical fertilizer cheaper, more accessible, and carbon free.

I sat down with Hiro Iwanaga, co-founder and CEO of Talus, and explored his company's plan to deliver low carbon ammonia through modular, small scale, energy independent production facilities that can be shipped to remote regions and allow farms or groups of farms to produce their own green ammonia. The technology could completely revolutionize the ammonia production supply chain. But first, our [00:05:00] new segment, this week in Climate News.

Welcome to Climate News. I'm joined by Julio Friedmann. Julio, great to have you, as always. I thought we'd start today with a story about how the Gulf Stream system could collapse as soon as 2025. According to a new study, the shutting down of this vital ocean current called AMOC, which stands for Atlantic meridional overturning circulation, or AMOC, would bring catastrophic climate impacts.

This, this was shared quite widely. Um, Julio, what is your take on this story?

Julio Friedmann: Right. So, this story, uh, was run in many different magazines and media outlets to many different descriptors. The one that a lot of people are freaking out about is the one that ran in The Guardian, in which they specifically said the Gulf Stream could collapse by 2025.

[00:06:00] That is wrong. Actually, that is not what this article said, uh, in any way, shape, or form. The Gulf Stream is not the subject of the study. Instead, like you said, AMOC, the Atlantic meridional, uh, overturning circulation is. And it is also not really what the authors of that article said either. What the article actually said was something that scientists have known for a long time.

If we continue on our current warming trajectory, eventually that circulation will slow and potentially stop. This is the downwelling current in the North Atlantic that drives heat distribution in the ocean on like a thousand-year time scale. So it's a long, slow, big current. It has huge impacts, but this is what we're talking about, not the Gulf Stream. 

Second of all, prior climate studies suggested that it was on the order of slow down on like the 2100 timescale. So like at the end of the century. The new [00:07:00] study used a different approach. Instead of these circulation models, they were actually using AI and statistical methods. And they said, huh, it looks like this could be sooner than we thought. 

So it could slow down as early as 2050, uh, as sort of the median value and because of the nature of the study, they're like, we don't quite know what would drive this, so it's possible it could slow down or stop earlier. 

It's fair to say you should be worried about this, right? It's fair to say this is a big deal. And using this novel method sheds light because many of the climate models we've used have underpredicted impacts. And the authors also said, we don't really have enough data to answer this question well, we really need five years more data to answer the question well, we just didn't want to wait five years. But the core story is worth tracking. 

James Lawler: What are some of the key risks to the slowdown of AMOC? 

Julio Friedmann: This AMOC current, the conveyor belt that moves heat around the ocean on a [00:08:00] thousand-year time scale, it does exactly that. It actually ends up affecting circulation patterns for climate all over the world and weather.

It affects benthic habitats. It affects uh, the distribution of nutrients in the ocean circulation. So there's a lot of long-term big scale impacts to shifts in the Atlantic meridional ocean uh, overturning circulation. It's one of these things that has been burgering along just fine now for about 10,000 or 11,000 years without a lot of variation.[AM2] 

So the potential consequences could be very large, but how that will actually manifest in any particular way is not so obvious, 

James Lawler: Right. So let's move to our next story. So it appears that seven large car makers are jointly building a giant network of 30,000 electric vehicle chargers. These chargers will have both CCS and NACS chargers available, and this represents a consortium of BMW, Mercedes, General Motors, Honda, Hyundai, Kia, and [00:09:00] Stellantis. The 30,000 number is a minimum in terms of their planning for these chargers but Julio, do you have any thoughts on, on what this represents? 

Julio Friedmann: This says a couple of things to me that are important. First one, for the next 20 or 30 years, every week is infrastructure week. Building out the infrastructure is a critically important job. And so the fact that so many of these car manufacturers have committed to an infrastructure design and are planning to build is great, great, great news. 

Second, it shows that there is value in standardization. We are seeing more companies going to these two different standards, NACS and CCS. That's great.

Increased standardization will ultimately help everybody. So, I'm all in favor of this and pleased to see that so many companies are beginning to vote with their feet and make a choice. 

James Lawler: Indeed. There's another interesting story, speaking of infrastructure, Canary Media reported on FERC taking a big step to get more clean energy [00:10:00] on the U.S. grid, and I'm quoting from an article that they published on July 31st. This is essentially reporting on FERC Order 2023, which was approved unanimously by their four commissioners last week. And what this will require is that grid operators and utilities take specific steps to reform the permitting of solar and storage and wind and storage projects and their approval for interconnection.

And that timeline, as we've talked about in the past, has just been incredibly dismally slow. And so this is a step to improve on that. I thought, Julio, and I'm very curious what you think about this. One of the most interesting parts of this is the order to consider advanced transmission technologies. So technologies that can actually improve the ability of current grid infrastructure to carry, you know, more, more current. What's your take?

Julio Friedmann: So this is super welcome as a development. This is basically the [00:11:00] Federal Electricity Regulatory Commission FERC saying, hey guys, you got a backlog of like 10,000 projects, can we please move this along? Originally, the way projects got performed and approved was simply, you know, first come first serve, but these were conventionally back in the before times, massive single projects, like one 10,000 megawatt nuclear plant or something like that.

Now that we have all these renewable projects springing up, that methodology doesn't work. So FERC said, you need to start thinking about bundling some of these things. Don't do just one project, do a group. Two, think about permitting within the distribution network. 75% of these projects are not in core transmission trunk lines, they're actually in the distribution network[AM3] . That's what happens when you have a distributed generation, which is very different than the way that utilities typically do this. They're pushing more authority into the balancing authorities. 

This is groups like CAISO and PJM and MISO to work with the utilities who, who make these requests. So it's all quite [00:12:00] good, actually. And it's one of those invisible kinds of permitting reforms that is not particularly contentious and will enable a lot more power to come forward. In particular, these renewable projects like wind or solar or wind plus batteries or solar plus batteries. 

James Lawler: Thanks, Julio. Julio, are there other articles this week that you think are particularly important that we should make sure to cover?

Julio Friedmann: In Georgia, their number three-unit, Plant Vogel, big nuclear plants, has just come online. That is a huge power plant. It is the last big power plant that will probably be built in the U.S. It is also the most recent power plant. That power plant is going to run for a very long time. This project got started a long time ago. It got started actually under the ARRA, the infrastructure and activation law that came out of the 2008 financial crisis. And it will make a very big [00:13:00] dent in Georgia's carbon emissions. 

It's a dispatchable, very large volume, nuclear power plant, it'll run for a long time. And because it's dispatchable, it will actually allow more renewables to be built onto the grid. It will begin to displace fossil fuel plants in Georgia and other places, so this is a really big deal. 

James Lawler: Right, well, Julio, thanks. So I think that covers our set of stories for this week. Julio, thanks again for joining us. 

Julio Friedmann: Look forward to talking to you guys again soon.

James Lawler: Now on to our interview with Hiro Iwanaga and his company Talus's goal to decarbonize ammonia production. Hiro Iwanaga was inspired to start Talus Renewables when he found that not only is ammonia production extremely carbon intensive, it is also more expensive in the places that need it most, such as food insecure regions of sub-Saharan Africa.

Over the last few years. Hiro and his team have developed [00:14:00] technology that enables farmers to make their own ammonia cheaply and efficiently. Hiro, it's great to be here with you. Before we dive in, tell us a little bit more about what drew you to ammonia. What is it and why is it so important? 

Hiro Iwanaga: I think people really forget about ammonia. Ammonia is the second most produced chemical in the world, so it is absolutely a critical material. Ammonia can be used directly as a fertilizer, which, you know, the United States, Argentina, South Africa, India do a, do a bunch of. But it's also frequently converted into other more granular, easier to use, easier to apply fertilizers, but 80% of ammonia production is either used directly or in the production of other fertilizers.

The big centers of production are China, Russia, parts of the Caribbean, and we ship it all over the world. The way we get it there is [00:15:00] we produce ammonia in a giant centralized plant, right? These are some of the world's largest chemical plants. They're fed by natural gas or coal, and we then truck it, rail it, ship it, rail it, truck it to final site. 

And so when we talk to farms in sub–Saharan Africa, the average bag of fertilizer travels 10,000 kilometers to get there. 

James Lawler: So take me back a little bit. How did you become involved in this in the first place? 

Hiro Iwanaga: Yeah, absolutely. So I actually spent almost all my career in finance. I worked at a couple large investment funds and as part of that work, I'd led some of our investments into green tech, primarily, you know, these were big funds and so focused on large investments in solar and renewables and public companies that were focused on clean tech.

And as part of that, I [00:16:00] had done a bunch of research into green hydrogen and so the origin of our work was actually philanthropic in nature. As, as you may know, you know, you look at sub–Saharan Africa, for example, 50 to 75 million people on the brink of famine[AM4] , crop yields are a quarter to a fifth of the developed world. And the big driver of that is basic fertilizers, a critical raw material costs double what it does in the United States or is simply inaccessible. 

James Lawler: And so given that ammonia is made all over the world and often needs to be shipped to its final destination where it'll end up in the ground and help crops grow, where does Talus fit?

Hiro Iwanaga: So the origin of the work, I had funded research into building a modular containerized system where we could deliver a shipping container. It ended up being five shipping containers, but you deliver a few shipping containers. between rural farming community, plug it up to power and water, we don't need any inputs other than power and water, a lot of power and a little bit of water, and produce a [00:17:00] standard, in this case, carbon free ammonia fertilizer that can reduce the cost of that fertilizer by 40%.[AM5] 

And, and obviously after COVID for a lot of these farming communities and for commercial farms, for, for our industrial customers, in addition to it being cheaper because we displace this long, complicated, unreliable supply chain, we guarantee the availability of that fertilizer and we guarantee that price.

James Lawler: Now tell us about the mechanism itself. So you mentioned this is like a five-shipping container system or one to five shipping containers, perhaps depending on the size, but, but tell us what, what exactly is going on in those shipping containers to produce the ammonia.

Hiro Iwanaga: Yeah. One of our primary selling points is, and when we work with a farm, we manufacture our systems, we ship it onto site. Once it's delivered onto site on the back of five trucks, it takes us a couple weeks to connect the system, to hook it up to power, hook it up to water, and in a few, in two to three weeks, it's producing ammonia. What's going on inside that system?

You, we have one [00:18:00] container that pulls nitrogen from air, relatively easy to do. We have one container that pulls hydrogen from water. It's a standard alkaline electrolyzer. And then we have a container that takes that nitrogen hydrogen, combines it and produces a standard anhydrous ammonia. 

James Lawler: So to be clear, Talus’s process diverges from traditional ammonia production in a couple of ways.

But perhaps most critically in how it produces the hydrogen that's needed to combine with nitrogen to make the ammonia. So Talus’s process does not use methane, it uses electrolysis, which is essentially passing electricity through water to produce hydrogen and oxygen. Then it uses that hydrogen to create the NH3 or the ammonia. That electricity can be produced by renewables, which is precisely what Talus does. 

Hiro Iwanaga: Our system, because it was designed for off-grid applications in sub-Saharan Africa originally, it is designed to run on fully [00:19:00] intermittent power. Certainly if you're building any of these big plants or a chemical plant, you need power 24/7 and if you're down for even a minute, that's a big problem. 

Our system is designed to run seven hours a day. The continued reduction in cost of renewable power, solar and wind primarily, others also, but that will change how we look at the industrial world over the next 50 years and it's because what that allows is power intensive operations.

James Lawler: So I'd love to talk about how you've seen the market for low carbon ammonia change and how that affects what you're doing now. So before you got involved in Talus, you were an investor at Baupost, which is a large investment firm that cuts checks to all kinds of companies. How has the market for green ammonia evolved, you know, since you started to look at this?

And are these kinds of projects more economically feasible [00:20:00] today than they were, you know, 10, 15 years ago? 

Hiro Iwanaga: So the fundamental problem with green tech over the last 20 years is it's incredibly capital intensive. You have to think about things in decade long time frames. 

These projects have enormous project risk. If you, if you think about these global mega projects, these billion-dollar multibillion dollar projects, 25% of them never complete, right. Of the remaining 75%, the vast majority are going to be over budget and over time[AM6] . 

And so those weren't the types of projects that a normal investment fund would be able to fund, right? We'd sit there and be like, look, the economics of them are okay, maybe, takes 10 years to get your money back.

So I wasn't interested in working in any of those, in those big systems. If you take a step back, when people think of green tech, you immediately think about decarbonization. Important goal. You're not going to see the impacts of that at any time in the near future. And so it's harder to, you know, it's harder to get viscerally excited about.

What is really interesting about green tech though, is it is inherently modular in its technology and what it allows for is for local [00:22:00] production of key inputs. When you think about climate tech in general, one of the big issues is they're usually expensive, big pieces of, of capital equipment. And there's just a lot of unknown risks when you're - when you're building and deploying these things over a five to ten year long timeframe.

These plants that people are talking about now aren't going to open for seven years. There's enormous risks over that period. 

James Lawler: Yeah.

Hiro Iwanaga: But what I think people forget about one of the other, one of the other benefits of green tech, like solar, is the idea that you can build a small solar farm to directly power a rural community. Where before, you'd sit there and say well I got to build a giant natural gas plant or a coal plant and then and build infrastructure and build transmission lines and distribution lines and, and power control systems to deliver that to people. That's worked for the developed world where we've [00:23:00] invested in that infrastructure and even there, it doesn't work great in a lot of cases, right, there where we're trying to- we're, as you know, you've discussed this in a couple of your other podcasts, right? You know, there is a lot of focus on improving both the reliability and the performance of our electrical distribution grid.

Solar and and local production of power solves - can solve - a lot of those problems over time. And so I think it's similar for sectors like green ammonia or chemicals where you can sit there and say, hey, if in most parts of the world, the distribution cost of basic raw materials like ammonia, like fertilizer is cost prohibitive. And so, yeah, a big plant is cheaper than us in producing a ton of ammonia, but it's not that much cheaper than us because of how we produce it. And the cost to get it there and the reliability of, of using that potentially        10, 000 kilometer long supply chain across ships, trucks, and rail, that's really expensive and [00:24:00] unreliable. 

And so when we go to, when we go to big farms and big mining companies and big industrial users of ammonia, they're just as focused on supply chain resiliency and supply chain certainty as they are on, on, on the cost savings. And as we talk to us farms, you know, we haven't talked about the US, a year ago, I would have said the US wouldn't have been that attractive a market for us. So I would have said, our focus is South America, sub-Saharan Africa, Southeast Asia, parts of India, where we know the cost of fertilizer is double what a farm in Iowa pays. It's really simple, right? Like they have either no access to fertilizer or expensive access to fertilizer, we can lower the fertilizer cost, we can make it carbon free, we can make it more reliable. Really easy to make that pitch. 

In the US, because we have, you know, we have 20 ammonia plants[AM7] , giant ammonia plants in the United States, we get a bunch of our ammonia delivered from the Caribbean, from primarily Trinidad and Tobago. And again, it is relying on an expensive supply chain, but you [00:25:00] know, we've, we've invested billions and billions of dollars of infrastructure to make that work.

When we work with farms around the world, we're probably 30% cheaper than their current sources of fertilizer on, on some long-term average, right? Since fertilizer prices are incredibly volatile. In the US we probably would have been  20% more expensive and all of that changed with the Inflation Reduction Act and green hydrogen tax credits. 

James Lawler: The Green Hydrogen Tax Credit is part of the 2022 Inflation Reduction Act, and it rewards companies for producing low carbon hydrogen.

Under the IRA, companies are eligible for a tax credit of up to $3 per kilogram of green hydrogen produced. In this case, green hydrogen is hydrogen whose production emits less than half a kilogram of CO2 per kilogram of hydrogen. You might be thinking, but wait, Talus's end product is ammonia, not hydrogen.

That's true, but hydrogen is one of the ingredients made in the process of producing ammonia, meaning that if you want to make green ammonia, you first have to make green hydrogen. Because Talus also [00:26:00] produces ammonia in the US, this allows Talus to take advantage of the tax credit, which Hiro explains, makes their business model that much more lucrative and feasible.

Hiro Iwanaga: For the legislation itself, we get a credit for the production of green hydrogen. That green hydrogen is used in our green ammonia. So, the math of it is for each ton of ammonia, there's 180 kilograms of green hydrogen. And so we get a credit for that hydrogen produced. So we can deliver a ton of ammonia for, order of magnitude, $700 to $900 per metric ton, call it $700 per short ton.

The green hydrogen tax credit that we qualify for, assuming we use all renewable power, and our systems can produce a carbon- free green ammonia, we will get to under $400 and sometimes substantially less. 

A US farm probably thinks their 20-year average price for ammonia, it was probably $500 to $600. So at $700, you really need a farm that wants to pay a premium for carbon-free and for supply chain resilience. And there are some farms that would do that. They're like, no, I'm like, I'm willing to pay for a long-term fixed price, long term guaranteed availability.

That's not the case for the biggest farms, the biggest farms are like, look, I can't pay 30% more for, you know, one of our, one of our most important inputs. And so with the green hydrogen tax credit, now we can offer that same green ammonia for $400 or less. And now we can make the same argument we, we make to a farm in India or right, or South America, or, or sub-Saharan Africa. We are cheaper, we're more reliable and we’re carbon free. 

James Lawler: How do you think about the political risk associated with this subsidy and how does the customer conversation go [00:28:00] along that vector? So, you know, it could be that a future administration, you know, cancels the, the hydrogen subsidy. And at that point, you've delivered this, you know, your company, because you guys are, are taking on that upfront cost of producing these, these systems and your customers are basically, you know, you're entering into a contract that guarantees the customer this fixed price, which is lower than it would be if the subsidy weren't there. 

So if the subsidy goes away, that's your risk. That's on you guys, presumably. So how do you think about that political risk? I would imagine that's substantial if you're going to go into the US market in a big way. 

Hiro Iwanaga: Let me start with the IRA and the tax credits, a couple things. One is the, the tax credit has been funded for 10 years, for a minimum of 10 years. I think it'll end up getting extended anyway after that, right? It's like the wind tax credit or solar tax credit. It will, it will come down and the amount of the tax or the credit will come down in size over time. But the $3 credit has been, has been funded for a minimum of 10 years. [00:29:00] And so we're pretty comfortable with that piece of that 10 years. 

The second piece is it's actually a pretty popular tax credit, right? If you think about it, it's supported by- it's supported by a bunch of the global energy companies. It is supported by the American Farm Lobby. So you, you have reasonable political support for it, right? Both whether you are focused on, on decarbonization in the climate, whether you're focused on U. S. food security. 

James Lawler: So another question for you is the you know, fertilizer use is not without controversy, right?

I mean, you mentioned that it certainly increases crop production, but nitrogen, nitrogen oxides are potent greenhouse gases and they cause a lot of their other harmful effects associated with adding nitrogen, nitrogen additives, to soils, right? I mean, how do you think about that? 

Hiro Iwanaga: We think we're fundamentally complementary to regenerative farming practices, right?

Ultimately, if you think about regenerative farming, the idea is to use less chemicals and less [00:30:00] synthetic additives, right? Less fertilizers, herbicides, fungicides, maybe none for some of those. But what's really attractive about ours is, so when we think about our first full size commercial deployment, which, you know, again, just deployed to Kenya Nut Company in East Africa.

And so they're using this because, right, they're excited about, they can target ammonia in ways that they couldn't have done with a standard granular fertilizer where you just spread it everywhere on the ground, right. We actually think we can reduce the actual kilograms or tons of fertilizer that we're using in these fields and so from a regenerative farming practice, they still have all the regenerative farming practices, but it supports their regenerative farming by allowing them to use less nitrogen. 

Now ultimately, yes, there are problems with the nitrogen fertilizers. One, we don't use nearly as much as we used in the 1970s, 1980s. So we [00:31:00] don't, one, we don't use as much, but two, really, if you think about it, food security, and especially if you think about the subsistence farmer, which is still 60% of the population across sub Saharan Africa, getting access to a reliable, inexpensive, and in this case, carbon free fertilizer is a huge step in their food security crisis.

James Lawler: One feature of this, I'm just curious to ask you about is maybe we just look at the US first. So in the US you mentioned one of the attractive features of the market is the subsidy requires green electrons. You mentioned, you know, one megawatt system, it's about eight acres of solar per megawatt or you know, six to ten acres, maybe depending on where you are, I believe, per megawatt to produce.

Hiro Iwanaga: Yeah. I think in the Midwest, we're seeing systems that are way smaller than that now.[AM8] You know, probably-

 James Lawler: Oh, you are.

Hiro Iwanaga: Yeah. Uh, I think depending on where you are, I mean, Arizona, obviously even less, but for a megawatt, probably two acres. 

James Lawler: Okay. Okay. So are they, are the customers that you're speaking with, the ones you [00:32:00] mentioned, do they, are they intending to like contract with solar developers? Or do they already have solar? 

Hiro Iwanaga: Absolutely. So the first system that we're building with Landis, Landis is building their own solar farm. I want to, this is changing gears a little bit, but for our one ton per day system that is deployed on site on a single farm. Our bigger systems we actually think will be near site and serve multiple big customers.

But we think about our one ton per day system. That is installed on site is, that's effectively dedicated to a single farm. The way that works is that farm will build solar, work with a solar developer, or we can build that for them, but you add solar, that solar will lower the cost of their power, right out of the gate, right? Because they generally, farms have pretty expensive power. So they save on power costs, and because our system can run intermittently, we can take any excess power that they're not using, either from the grid or [00:33:00] from or from this or from this new solar farm, and you use that to produce ammonia.

So that's real attractive to a power company because now, one of the issues of the power with- from a power companies- from a utilities perspective is, hey, if you build a one or two megawatt solar farm, and you're going to give me back that power when you, when the farm doesn't need it, I don't know what to do with that power and I don't have the grid to transport that all around.

And so what we've seen from some of our big customers is the big utilities around there, you know, put obstacles to building, you know, reasonable sized solar farms and make it more difficult for them to deploy these solar farms. So we can go to those same utility and say, one, I'm going to build this solar farm.

We're going to use all of the power that it produces, right? Whenever we- in addition, we can actually provide grid resiliency because when you need that power utility, we'll shut our systems down and you can take [00:34:00] that power as needed. We developed our systems for off grid use in Africa, where we have intermittent solar power. We don't know how much power we're going to have at any given time, and so our system needs to immediately adjust to that.

We integrate into our farms’ operations already, and so now we can sit there and say, okay, well, the farm's the priority, and so you get the power first, and we'll take anything that's left over. All of that is done autonomously in our software, and so, yeah, that's really exciting. 

James Lawler: Very cool. Well, Hiro, it's really great to have you. This was such a, it was a really fun conversation. Thank you so much for joining us today. It's been great.

That's it for this episode of the podcast. To learn about other companies, making our most carbon intensive products more green, check out our other podcast conversations at climate now.com. If you like today's episode, please leave us a review, share it with your friends or colleagues, or tell us what you think at contact@climatenow.com. Thanks for listening, and we hope you'll join us for our next conversation.[00:35:00] 

Climate Now is made possible in part by our science partners, like the Livermore Lab Foundation. The Livermore Lab Foundation supports climate research and carbon cleanup initiatives at the Lawrence Livermore National Lab, which is a Department of Energy applied science and research facility. More information on the foundation's climate work can be found @livermorelabfoundation.org.