Fertilizers Europe

Background

Fertilizers Europe (FE) is a trade group representing the fertilizer industry in the European Union.

According to its website, FE represents 16 corporate members, including German agrichemical giant BASF and Norwegian fertilizer company Yara, as well as seven national fertilizer associations. Yara and BASF are major producers of fossil fuel-based fertilizers, also called mineral fertilizers.¹

In a 2019 European Commission brief n on the use of fertilizers in the EU, Fertilizers Europe estimated that out of 179 million hectares of available agricultural land in the EU, 134 million, or 75 percent, are fertilized with mineral fertilizers. FE also stated in the brief that the EU produces 9 percent of the nitrogen fertilizer produced globally, 3 percent of the phosphate, and 8 percent of the potash or potassium-based fertilizer.²

Nitrogen fertilizer is one of the most commonly used mineral fertilizers. Nitrogen fertilizer is usually produced by mixing nitrogen from the air with hydrogen produced by methane gas to create ammonia, which is then used to create nitric acid, the basis of nitrogen fertilizers – or urea. Fertilizers Europe has stated that “approximately 60 [percent] of the natural gas is used as raw material, with the remainder employed to power the synthesis process.”³

When applied, nitrogen fertilizers release nitrous oxide (N2O), a greenhouse gas that is almost 300 times more potent than CO2 over a 100 year period. N2O is released into the atmosphere by natural processes, such as the activity of microbes in the world’s soils and oceans. However, more than half of human-made N2O emissions come from agriculture, mainly the use of fertilizers.⁴ ⁵

Fertilizers Europe is a partner association of the European Chemical Industry Council (Cefic), an industry association representing chemical companies across Europe. Cefic’s members account for approximately 15 percent of world chemical production, according to its website.⁶ ⁷

Stance on Climate Change

Fertilizers Europe claims that the fertilizers industry has “demonstrated a strong commitment to improve environmental performance” by reducing its greenhouse gas emissions by more than 40 percent compared to 1990 levels.⁸

Fertilizers Europe has developed a carbon footprint calculator for the fertilizer industry. In a November 2019 article about the calculator, FE Senior Energy and Climate Advisor Michał Wendołowski wrote that carbon accounting is essential if the EU is going to meet its commitments under the Paris Agreement and become “climate neutral” by 2050. He also wrote that the calculator demonstrates that the European fertilizer industry “represents the least emission-intensive production” per ton of product and nutrient for all fertilizers analyzed, except for urea produced in Oceania. “The EU average carbon footprint is lower than in other regions mainly due to the higher average energy efficiency of EU plants and GHG abatement technology,” he added.⁹

According to the “Policy Priorities” listed on its website, Fertilizers Europe focuses its activities on policies involving climate change & energy, industry competitiveness, industrial legislation, agriculture & environment and the circular economy.¹⁰

In a 2020 interview with The Parliament Magazine about how Europe’s Farm to Fork policy will affect the fertilizer sector, Fertilizers Europe Director General Jacob Hansen said: “We clearly cannot survive without mineral fertilizers and so need to make sure this resource is used better.” Speaking about the scope of the policy – which includes a target to reduce the use of fertilizers by 20% – he claimed that “the [EU’s] proposed level of ambition is clearly unrealistic in the given time frame.”¹¹ ¹²

In its 2019/2020 annual overview, Fertilizers Europe stated that the targets proposed in Farm to Fork were “too ambitious given achievable farm practices.”¹³

Fertilizers and Climate Change

Agriculture’s direct contribution to climate change is caused by the release of greenhouse gases into the atmosphere. The main byproducts of agricultural activity are methane (CH4) from livestock digestion processes, which is stored in manure, and nitrous oxide (N2O), which is released by organic and mineral nitrogen fertilizers.“¹⁴

Rising use of nitrogen-based fertilizers has driven up global emissions of NO2. When released into the atmosphere, N2O can damage the ozone layer. It traps 300 times more heat than CO2 and can remain in the atmosphere for decades.¹⁵

Response to Fit for 55

Following the release of the Fit for 55 policy package, a group of legislative proposals designed to help the EU reduce net greenhouse gas emissions 55 percent by 2030, a press release from Fertilizers Europe stated that the package’s policies “fall way short” of what the industry needs by not recognizing the “need for competitiveness of European industry,” and said that the current version of Fit for 55 “increases carbon leakage risk rather than stimulating decarbonization.”¹⁶ ¹⁷

In the same press release, Hansen said that the industry is in need of “capital investments to move from fossil to renewable-based production,” that Fit for 55 is “simply not good enough to boost the investment and transformation of our sector,” and that “the consequences for EU farmers and the agri-food value chain are also underestimated.”¹⁸

In March 2021, prior to the release of the Fit to 55 Strategy, Reuters reported that industry groups including Fertilizers Europe and Cefic had sent an email calling on MEPs to change their position on an upcoming vote on proposed changes to the EU’s carbon border levy plan.¹⁹
As reported by Reuters, the particular issue under contention was a recommendation by an EU report – due to be voted on by MEPs – for changes to the EU’s carbon market which would get rid of “free” CO2 permits, meaning companies in certain industries could no longer emit certain allotted amounts of CO2 without paying a fee.²⁰

EU Emission Trading Scheme and Cross Border Adjustment Mechanism

In 2020 and 2021, Fertilizers Europe promoted content on the online European news outlet EURACTIV concerning how the agricultural fertilizer sector could be a testing ground for the EU’s carbon border levy. The promoted article featured comments from a representative of FE member, Yara, who warned that the proposed carbon border levy could impact the affordability of food.²¹

In a 2020 press release, Fertilizers Europe expressed concern over the European Commission’s decision to exclude the fertilizer sector from the updated EU ETS State Aid Guidelines. According to FE, “the fertilizer industry will also rely on electrification and will need state support to meet the additional costs incurred in the industry decarbonisation transition.”²²

The EU ETS package includes a proposal to avoid “carbon leakage” by putting a carbon price on imports of certain goods (also known as the Cross Border Adjustment Mechanism, or CBAM), starting with cement, iron and steel, aluminium, electricity and nitrogen fertilizers. While a number of free allowances is distributed under the EU ETS to prevent carbon leakage, the Commission’s proposal for a revised ETS would reduce the number of free allowances for all sectors over time. For sectors affected by the CBAM, which is designed to be an alternative to the ETS, the free allowances will gradually be phased out from 2026.²³

Following the European Parliament’s CBAM resolution vote in March 2021, Hansen stated: “We are glad to see that the [parliament] explicitly recognised fertilizers among other energy-intensive sectors as most suited for the new mechanism.”²⁴

Green Hydrogen and Green Ammonia

Conventionally, methane gas has been used in the first stage of nitrogen fertilizer production to produce hydrogen. The hydrogen is then combined with nitrogen to create ammonia, the key component of nitrogen-based fertilizers.

“Green” versions of nitrogen fertilizer would replace methane in two ways. Hydrogen production could be powered by power from renewable energy technologies, creating what is known as “green hydrogen.” Or, it could combine the use of methane with carbon capture and storage technologies to capture the emissions methane produces when burnt, creating what is known as “blue hydrogen.”²⁵ ²⁶ ²⁷

While blue and green hydrogen have been promoted as clean alternatives to traditional hydrogen production, some experts are skeptical about whether they are actually viable and climate-friendly alternatives. Green hydrogen makes up less than 1 percent of current hydrogen production, while recent scientific studies suggest that blue hydrogen may emit significantly more greenhouse gases than previously thought.²⁸ ²⁹ ³⁰

Research published in September 2021 predicts that green hydrogen will be comparable in cost, if not cheaper, than blue hydrogen by 2030. ³¹

According to FE’s “Feeding Life 2030” strategy, in which the organization attempts to “find solutions that answer the question of how to continue feeding a growing population while doing so in a more energy and environmentally efficient way,” the nitrogen fertilizer industry is “key to unlocking clean energy potential” because it produces ammonia, which FE calls a “carbon-free energy carrier.”³²

Fertilizers Europe Technical Director Antoine Hoxha, has called clean hydrogen a “major enabler for making carbon-free ammonia and fertilizers and low carbon food.”³³

Fertilizers Europe also advocates for the development of a green ammonia market. The concept of green ammonia production is based on running fertilizer plants entirely on renewable energy. Agriculture is responsible for 92 percent of volatile ammonia emissions (NH3) globally.³⁴ ³⁵ ³⁶

According to Fertilizers Europe, while livestock and manure management and application causes the majority – 64 percent – of agriculture’s NH3 emissions, nitrogen fertilizers account for around 17 percent of ammonia emissions globally.³⁷

Ammonia emissions are associated with two major types of environmental problems: acidification and eutrophication. Acidification refers to dropping pH levels in soil, marine or freshwater habitats. , It is caused primarily by increased absorption of CO2 from the atmosphere, and can harm the physiology of organisms in those environments. . Eutrophication takes place when environments are disproportionately enriched with minerals and nutrients, causing the excessive growth of plants such as algae. Itis often caused by heavy levels of nitrogen-rich agricultural runoff. In Europe, about 70 percent of agricultural land in the EU uses excessive nutrients, harming water quality and biodiversity.³⁸ ³⁹

According to Fertilizers Europe, precision farming can reduce losses of fertilizers to the air, and therefore diminish the release of ammonia and improve air quality. FE expects that the growing development and deployment of new technologies will reduce ammonia emissions linked to agriculture by 10 percent by 2030.⁴⁰ ⁴¹

Lobbying

According to the EU Transparency Register , Fertilizers Europe spent between €700,000 – €799,999 on lobbying in 2020.⁴²

Affiliations

Fertilizers Europe is a “partner association” of the European Chemical Industry Council (Cefic), which represents fertilizers companies including BASF and Yara, as well as oil and gas companies that provide the feedstock for the fertilizer industry.⁴³

In March 2021, Reuters reported that industry groups including Fertilizers Europe and Cefic had sent an email calling on MEPs to change their position on an upcoming vote on proposed changes to the EU’s carbon border levy plan.⁴⁴

Fertilizers Europe participates in the European Clean Hydrogen Alliance, an initiative of the European Commission set up in July 2020. The alliance supports “the large-scale deployment of clean hydrogen technologies by 2030 by bringing together renewable and low-carbon hydrogen production, demand in industry, mobility and other sectors,” and “aims to promote investments and stimulate the roll-out of clean hydrogen production and use.”⁴⁵ ⁴⁶

Resources

1
“Members,” Fertilizers Europe. Archived September 14, 2021. Archive URL:
https://archive.md/ZPrax
2
“Fertilisers in the EU, Prices, trade and use,” European Commission. Archived September 14, 2021. Archive URL: https://archive.md/gXedC
3
“How fertilizers are made?,” Fertilizers Europe. Archived November 22, 2021. Archive URL: https://archive.ph/g0xY2
4
Daisy Dunne. “Nitrogen fertilizer use could ‘threaten global climate goals’,” Carbon Brief, October 7, 2020. Archived November 25, 2021. Archive URL: https://archive.fo/L9DNY
5
“Global Nitrous Oxide Budget,” Global Carbon Project, October 7, 2020. Archived November 7, 2021. Archive URL: https://archive.ph/9CCuT
6
“List of Partner Associations” Cefic November 2021. Archived .pdf at DeSmog.
7
“About us,” European Chemical Industry Council. Archived May 25, 2021. Archive URL: https://archive.ph/B7NbG
8
“2030 Climate and Energy Policy Framework,” Fertilizers Europe. Archived November 22, 2021. Archive URL: https://archive.ph/9KNat
9
Michał Wendołowski. “Carbon footprinting in the fertilizer industry as an essential part of managing climate change,” Fertilizers Europe, November 12, 2019. Archived September 28, 2021. Archive URL: https://archive.ph/dSLNH
10
“Priorities,” Fertilizers Europe. Archived November 22, 2021. Archive URL: https://archive.ph/Y4kDk
11
“In conversation with… Jacob Hansen,” The Parliament Magazine, Archived September 14, 2021. Archive URL: https://archive.md/rQs7M
12
Martin Banks. “Commission’s unveiling of Farm to Fork Strategy receives mixed response,” The Parliament, May 20, 2020. Archived December 7, 2021. Archive URL: https://archive.fo/DmnGP
13
2019/2020 Overview.” Fertilizers Europe. Archived December 7, 2021. Archived .pdf on file at DeSmog
14
Tackling climate change,” European Commission, Archived December 3, 2021. Archive URL: https://archive.ph/vKMzc
15
Daisy Dunne.“Nitrogen fertilizer use could ‘threaten global climate goals’,” Carbon Brief, September 7, 2020. Archived November 25, 2021. Archive URL: https://archive.fo/L9DNY
16
“EU’s “Fit for 55” to spur policy innovation for climate action,” Climate KIC, July 26, 2021. Archived November 5, 2021. Archive URL: https://archive.fo/FFtU8
17
“Press Release: Fit for 55: Recognizing economic reality key to successful industry transformation towards climate neutrality,” Fertilizers Europe, Archived September 14, 2021. Archive URL: https://archive.md/wip/Ax1dS
18
“Press Release: Fit for 55: Recognizing economic reality key to successful industry transformation towards climate neutrality,” Fertilizers Europe, July 14, 2021. Archived September 14, 2021. Archive URL: https://archive.md/wip/Ax1dS
19
Industry lobbies EU lawmakers to change carbon border levy plan,” Reuters. Archived September 14, 2021. Archive URL: https://archive.md/wip/Re0qt
20
“Industry lobbies EU lawmakers to change carbon border levy plan,” Reuters. Archived September 14, 2021. Archive URL: https://archive.md/wip/Re0qt
21
“A carbon border tax on fertilisers? Think twice, EU told,” EURACTIV. Archived September 14, 2021. Archive URL: https://archive.md/XvZon
22
“Press Release: Revised EU ETS State Aid Guidelines to distort internal market and disincentivize investment,” Fertilizers Europe, Archived September 14, 2021. Archive URL: https://archive.md/wip/e5JSN
23
“Carbon Border Adjustment Mechanism,” European Commission July 14, 2021. Archived December 1, 2021. Archive URL: https://archive.ph/wip/LtncO
24
“Press Release: Parliament’s vote on carbon border adjustment mechanism reiterates the need for carbon leakage protection adequate to EU’s climate ambitions,” Fertilizers Europe, Archived September 14, 2021. Archive URL: https://archive.md/wip/cmrGf
25
“Clean Ammonia,” Yara. Archived November 25, 2021. Archive URL: https://archive.fo/0EbC9
26
“Decarbonising Food – Making the case for Green Fertilizers,” EURACTIV. Archived September 14, 2021. Archive URL: https://archive.md/wip/Ax1dS
27
“The potential for CCS and CCU in Europe,” European Commission, Archived September 14, 2021 Archive URL: https://archive.md/wip/DCSlg
28
Justin Mikulka. “Green Hydrogen’s Rapidly Falling Costs Undermine the Gas Industry’s Argument for Blue Hydrogen,” DeSmog, September 24, 2021.
29
Nathalie Thomas, David Sheppard, Neil Hume. “The race to scale up green hydrogen,” Financial Times, March 7, 2021. Archived November 12, 2021. Archive URL: https://archive.ph/rv9Az
30
Tom Baxter. “Blue hydrogen – what is it and should it replace natural gas?,” The Conversation, August 13, 2021. Archived November 5, 2021. Archive URL: https://archive.ph/d2sFP
31
Justin Mikulka. “Green Hydrogen’s Rapidly Falling Costs Undermine the Gas Industry’s Argument for Blue Hydrogen,” DeSmog, September 24, 2021.
32
“Feeding Life 2030,” Fertilizers Europe. Archived September 14, 2021. Archive URL: https://archive.md/wip/x9CAh
33
“Clean Hydrogen as A Major Enabler for Making Carbon-Free Ammonia and Fertilizers” The European Files. Archived September 14, 2021. Archive URL: https://archive.md/wip/tFezp
34
“Overview 2020/2021 – Green Ammonia: The Workhorse of the EU Hydrogen Economy,” Fertilizers Europe. Archived December 1, 2021. Archived .pdf on file at DeSmog.
35
“Explainer: Renewable Energy,” Climate Portal. Archived December 1, 2021. Archive URL: https://archive.fo/7xRfX
36
“Ammonia NH3 Emissions,” European Environment Agency. Archived December 1, 2021. Archive URL: https://archive.fo/A26DJ
37
“Farming & Air Quality : Rising to the Challenge Together,” Fertilizers Europe, Archived September 14, 2021. Archive URL: https://archive.md/wip/VbteP
38
“A climate-dependent global model of ammonia emissions from chicken farming ,” Jize Jiang , David S. Stevenson , Aimable Uwizeye , Giuseppe Tempio and Mark A. Sutton. School of Geosciences, University of Edinburgh. Archived September 14, 2021. Archive URL: https://archive.md/6Acww
39
“EU Missions – Soil Deal for Europe,” Publication Office of the European Union. Archived December 3, 2021. Archived .pdf on file at DeSmog
40
“Farming & Air Quality ,” Fertilizers Europe, Archived September 14, 2021. Archive URL: https://archive.md/wip/VbteP
41
“Farming & Air Quality : Rising to the Challenge Together,” Fertilizers Europe, Archived September 14, 2021. Archive URL: https://archive.md/wip/VbteP
42
“Transparency Register,” European Commission, Archived on September 14, 2021, Archive URL: https://archive.md/wip/tLWTW
43
“List of Partner Associations,” European Chemical Industry Council. Archived November 30, 2021. Archive URL: https://archive.ph/IiZLy
44
“Industry lobbies EU lawmakers to change carbon border levy plan,” Reuters. Archived September 14, 2021. Archive URL: https://archive.md/wip/Re0qt
45
“European Clean Hydrogen Alliance Members,” European Commission. Archived .pdf on file at DeSmog.
46
“European Clean Hydrogen Alliance,” European Commission. Archived November 5, 2021. Archive URL: https://archive.ph/OKqQV

DeSmog

DeSmog