Nitricity raises $10m for organic fertilizer plant in California

Nitricity, a California-based startup producing organic nitrogen fertilizer from air, water, renewable energy, and recycled almond shells, has raised $10 million from capital providers including Elemental Impact and Trellis Climate to build a fertilizer plant in Delhi, California.

The raise—which takes the firm’s cumulative funding to over $50 million—includes a mix of equity and non-dilutive project financing.

Set to become operational in 2026, the plant will produce hundreds of tons of fertilizer by 2028, with capacity already sold out through 2028 under binding offtake agreements with local organic growers of berries and leafy greens.

Located in Merced County in California’s Central Valley, the project is expected to create approximately 20 jobs, said CEO Nicolas Pinkowski. “In a market where most nitrogen is imported, our solution on-shores production to deliver exactly what growers have been asking for: a sustainable, organic alternative that strengthens farmers’ bottom lines and benefits our community and environment.”

The product, which is designed for application through irrigation lines, is approved for use in organic farming and registered with OMRI (the Organic Materials Review Institute) and OIM, the California Department of Food & Agriculture’s Organic Input Material program.

Strategic pivot

Nitricity had previously explored a variety of approaches to extract nitrogen from air that mimic the way lightning naturally fixes nitrogen in the atmosphere. One such approach is creating a high-voltage electrical discharge to create a plasma arc or Jacob’s Ladder.

This breaks the bonds in atmospheric nitrogen such that nitrogen molecules split and react with oxygen to form nitric oxide. This can then be dissolved in water and combined with limestone to form calcium nitrate fertilizer.

The problem with this type of approach was that the economics ultimately didn’t add up, Pinkowski told AgFunderNews. “We’ve built Jacob’s ladders powered by solar panels for nitrogen fixation. We’ve also made fertilizer with molten lithium metal. The challenge with these approaches is the cost.

“So we worked with regulators and changed our technology and market segment and invented a new organic-approved fertilizer that can compete with chicken manure and fertilizers such as fish emulsions that we’re able to sell at a market price that makes sense for both farmers and Nitricity.

“Recycling plant nutrients doesn’t sound as exciting as plasma, but I think there’s tremendous opportunity here.”

Recycled almond shells

Nitricity cannot share more information now as it is filing patents, he said, “But we’ve developed a new process that relies on the combustion of [nutrient-packed] organic almond shells and a combination with air and water and renewable energy to make a product that we’re calling Ash Tea fertilizer.”

He added: “What we end up with is a liquid organic nitrogen fertilizer containing many other valuable micronutrients, as well as some potassium. It has a rich, golden color like Rooibos tea, which we can send to farmers in liquid form in totes or tankers.”

While the process is proprietary, most of the equipment required is relatively standard, “which is critical to build this on a reasonable timeframe,” he said. “If you look at what we call our secret sauce, it’s actually a relatively small component of the overall project footprint, about a million dollars of the $10 million dollar cost.”

He added: “We’re leaning into a circular approach, saying let’s take the nutrients that fell from the almond tree, turn these around and brew a high-performing fertilizer with them so they can then be returned to the soil to make a bountiful crop.”

Local solutions

Given that the fertilizer is in liquid form, the solution is best deployed locally, he said.

“The model is built around what’s available locally both in terms of recycled agricultural waste, air, water, and renewable power, to produce something that that is tailor made for local farming and soil and designed for fertigation in California’s Central Valley. It’s a drop-in replacement for the liquid organic fertilizers that folks are using now. Central Valley farms currently import almost all of their nitrogen from overseas, so it feels really good to be producing fertilizer locally in California.”

He added: “The product is produced within 100 miles of where the fertilizers will ultimately go so we cut down fertilizer distribution emissions and associated costs.”

The business model

The business model is that “Nitricity builds the projects and organizes finance for them,” said Pinkowski, who cofounded Nitricity in 2018 with Joshua McEnaney (president and CTO), and Jay Schwalbe (CSO).

“These projects purchase almond shells from the local community and renewable power and then sell fertilizer offtake agreements. Today we have multi-year fixed price offtake agreements, which was critical to securing the financing we just announced.”

Looking at the available options for organic farmers, he said: “Some of our farming customers are currently using chicken manure pellets, but you have to apply a lot more than you would like and your crops can still be starved for nitrogen mid-season. Fish emulsion [from fish byproducts] is also common, but it carries a very high greenhouse gas emission cost, is very stinky, salty, and has the propensity to clog irrigation lines.

“We’ve worked hard to find a solution that would provide nitrogen, reduce emissions, and doesn’t clog irrigation lines, which turned out to be a surprisingly valuable selling point.”

The size of the prize

While the global fertilizer market is worth around $300 billion, he said, “Our internal estimates suggest that the liquid organic nitrogen fertilizer market could be as big as $11 billion, so it’s by no means a small market. We’re initially focused in the western states of the US, but we also believe this technology will be very valuable to deploy in Europe.”

Now that the Delhi, California, project is financed, the team is “already working on the next facilities,” he said. “We have customer interest, and we’re limited only by our supply capacity.”

The conventional nitrogen fertilizer industry relies on the energy-intensive Haber-Bosch process to synthesize ammonia from nitrogen and hydrogen under high pressures and temperatures using an iron catalyst, he said.

“There’s a big movement now to use the same process and just replace the fossil fuel inputs used to make hydrogen in a greener way, for example via electrolysis, or using geologic hydrogen, which could be a real game changer.”

However, the same challenges still face some of these green ammonia solutions around poor nitrogen use efficiency (whereby excess nitrogen washes into waterways or escapes as ammonia gas, for example), he said. “Imagine filling your car at the gas station and losing 70% of the gasoline you pay for.”