Fertilizer has always been the heartbeat of modern crop productivity, but its supply chain has become a stress test for farmers. Price spikes after geopolitical shocks, export restrictions, and volatile natural gas markets have turned nitrogen into an unpredictable cost. A wave of agriculture technology is aiming to change that dynamic by shrinking fertilizer production to farm scale. Modular “green ammonia” units—small, containerized systems powered by electricity—promise on-demand nitrogen made from air and water, with a dramatically lower carbon footprint and greater local control.

Why make ammonia on the farm?

Conventional ammonia—the building block for urea, UAN solutions, and many other nitrogen fertilizers—is made in centralized Haber–Bosch plants, typically using natural gas. It’s efficient at scale, but it ties farm budgets to global energy prices and lengthy logistics. The approach also carries a large carbon burden: modern gas-based plants generally emit around 1.6–2.0 tons of CO₂ for every ton of ammonia produced, and more when coal is used.

On-site, electrically powered ammonia production flips that equation. By pairing renewable power with compact synthesis systems, farms and co-ops can convert air and water into anhydrous ammonia or ammonium solutions. The appeal is threefold:

• Resilience: Local production decouples growers from shipping bottlenecks and seasonal shortages.
• Cost control: Electricity becomes the dominant input cost, enabling hedging via power contracts, on-farm solar or wind, and demand response.
• Lower carbon intensity: When powered by low-carbon electricity, on-farm ammonia can reduce upstream emissions dramatically compared with conventional supply.

How the technology works

Although designs vary, most modular systems include four core elements:

1. Air handling: Ambient air is filtered and nitrogen is separated using membranes or pressure swing adsorption. Oxygen and argon are vented or repurposed.
2. Water electrolysis: Electricity splits water into hydrogen and oxygen. The hydrogen is fed to the synthesis unit; oxygen may be vented or used elsewhere on the farm.
3. Ammonia synthesis: Nitrogen reacts with hydrogen to form ammonia. Today, most commercial prototypes miniaturize Haber–Bosch chemistry in skid-mounted “micro-Haber” loops. Alternative pathways—solid oxide routes, plasma-assisted reactors, and direct electrochemical nitrogen reduction—are advancing, but generally remain earlier in maturity.
4. Storage and handling: Product can be stored as anhydrous ammonia in pressure-rated vessels or absorbed in water to form ammonium hydroxide for fertigation. Some systems also integrate conversion to UAN solution.

Energy demand is the fundamental design constraint. Producing a ton of ammonia via electrolysis plus synthesis typically requires around 9–12 megawatt-hours of electricity, depending on electrolyzer efficiency and plant integration. That makes power price, uptime, and capacity utilization central to the business case.

What’s commercially real today

The basic science of ammonia synthesis is more than a century old; the novelty is right-sizing and electrifying it. The University of Minnesota’s West Central Research and Outreach Center ran a landmark “wind-to-ammonia” demonstration that proved local production can be engineered safely and reliably. In the private sector, multiple companies have piloted or announced modular systems aimed at farms and ag co-ops, targeting outputs in the tens to hundreds of kilograms per day—enough to serve individual operations or clusters of growers.

Two families of solutions dominate near-term deployments:

• Electrolyzer + micro-Haber modules: These use familiar components—alkaline or PEM electrolyzers paired with compact synthesis loops—to deliver anhydrous ammonia or solutions. They’re mechanically straightforward, bankable, and can be serviced by industrial gas technicians.
• Plasma- or solid-oxide–assisted systems: Intended to run flexibly with intermittent renewables, these designs aim to lower pressure/temperature requirements and respond quickly to changing power. Several are in pilot stages as developers scale stacks and validate durability.

Direct electrochemical nitrogen reduction (ENRR)—making ammonia in a single step from air and water—has seen fast academic progress, but most experts still consider it a medium-term candidate. The hurdles are selectivity, energy efficiency, and long-term catalyst stability, especially in real-world air streams.

Economics: from electricity to levelized ammonia cost

Because electricity is the largest variable cost, the math is sensitive to power price and availability. A rule of thumb: each ton of ammonia consumes roughly 10 MWh of electricity. At $30/MWh, the electricity component alone is about $300/ton; at $60/MWh, it’s around $600/ton. Add capital recovery, maintenance, water, and operating labor, and many early systems land in the low-to-mid hundreds of dollars per ton on top of the power cost. That can be competitive in high-price fertilizer markets or when paired with low-cost on-site renewables and incentives.

Policy signals matter. In the U.S., clean hydrogen tax credits can improve project economics for systems that produce hydrogen via electrolysis as an intermediate step. In the EU, rules governing renewable fuels of non-biological origin help define how “green” the electricity input must be. Meanwhile, grain buyers and food companies are increasingly offering premiums or supply contracts for lower-carbon crops, creating a pathway to monetize the emissions reductions from on-farm ammonia.

Operational advantages beyond carbon

Timing matters as much as tonnage. On-demand production lets growers align nitrogen availability with plant demand and weather windows, which can limit losses from volatilization and leaching. For operations that rely on fertigated ammonium solutions, on-site conversion simplifies logistics and can reduce hauling of water-heavy liquids. Co-ops see potential to run units continuously during off-season months to build inventory, then ramp output ahead of spring applications.

Integration with farm power is another lever. Modular systems can act as controllable electrical loads, soaking up excess solar at midday or wind at night, and idling when power is scarce or expensive. That flexibility can unlock better tariffs, lower curtailment, and stabilize microgrids that also supply irrigation pumps, cold storage, or grain drying.

Safety and compliance

Anhydrous ammonia is common in agriculture and widely regulated because it is toxic and corrosive. Modular systems don’t change those properties; they concentrate them locally. Vendors are packaging extensive safety features—detectors, ventilation, pressure reliefs, and automated shutdowns—alongside training and compliance support. Depending on jurisdiction and storage volumes, farms may need to meet process safety management rules, maintain hazard communication plans, and coordinate with local emergency responders. Many early deployments are on sites that already store or apply anhydrous ammonia and have trained personnel and infrastructure.

Limits and open questions

• Scale versus reliability: Smaller units mean higher capital cost per ton, and farms will weigh redundancy (multiple skids) against simplicity (one larger unit).
• Durability: Electrolyzer stack life, catalyst longevity, and compressor maintenance drive operating costs. Multi-year field data will determine true lifetime economics.
• Water use: Electrolysis doesn’t consume much water compared with irrigation, but purity requirements may necessitate treatment in some locations.
• Traceability: For growers seeking low-carbon premiums, credible metering and verification of electricity sources and run hours will be essential.

Early adopters and where this shows up first

The economics look best where electricity is inexpensive or behind-the-meter: wind belts, irrigated farms with large solar arrays, and co-ops that can spread capital across many members. Regions with unreliable fertilizer logistics—remote geographies or developing markets with long supply chains—also stand to benefit. Several companies have announced farm-scale pilots in North America and Europe, and co-ops are exploring joint ownership models to smooth capex and operations.

What to watch in 2026

• Verified carbon intensity: Expect the first crop contracts that explicitly credit on-farm ammonia’s lower upstream emissions, tied to digital monitoring and third-party verification.
• Electrolyzer progress: Efficiency and stack replacement costs are improving; every percentage point matters to ammonia’s power bill.
• Hybrid systems: Pairing modular ammonia with biogenic hydrogen (from manure-derived biogas reforming) or with thermal storage could broaden siting options.
• New chemistries: If plasma or electrochemical routes close the efficiency gap while maintaining durability, system complexity and costs could drop further.
• Safety playbooks: Standardized training and permitting templates tailored to farms will accelerate adoption and insurer comfort.

The bottom line

Local, low-carbon fertilizer production is moving from concept to field reality. While not a fit for every farm, modular green ammonia offers a credible path to tame nitrogen price risk, shrink emissions, and anchor on-farm energy strategies around productive loads. If pilots in the next 12–24 months demonstrate dependable operation and clear unit economics, fertilizer’s century-old model could quietly diversify—one containerized plant at a time.