In just over a month, applications for Japan’s first large-scale hydrogen subsidy scheme are due to close. The ¥3 trillion of subsidies are expected to support a number of sectors that seek to switch from burning fossil fuels to cleaner alternatives, with potential endusers including steel and glass makers, chemical and oil refinery firms, as well as transport companies.

The most prominent sector in line for initial state support, however, is power generation. Japan still relies on coal and natural gas burning for over two-thirds of its electricity generation, and the prospects of renewables completely taking over in the 15 years are slim, according to the government’s own estimates.

This puts ammonia in line for special attention. Ammonia can be used as a hydrogen carrier because it contains hydrogen (about 18% by mass). Like hydrogen, it burns without emitting CO2, but unlike its cousin ammonia benefits from an existing global supply chain, as it has long been produced and transported for use as fertilizer. This established infrastructure makes ammonia a relatively cost-effective option for scaling up as a fuel.

Arguably Japan’s biggest backer of ammonia as a decarbonization tool is the country’s top thermal power utility, JERA, which ran the first commercial-scale test of co-firing ammonia and coal in a major power station. The 80% (coal) – 20% (ammonia) test was successfully completed last year; a full-time shift to this ratio at JERA’s Hekinan station is due in 2027. A year later, testing of 50-50 co-firing at the same plant is expected to start.