India seeks to boost domestic green ammonia supplies to fertiliser sector

Synopsis

India's Solar Energy Corporation (SECI) is on a mission to boost the production of green ammonia, targeting a significant reduction in the country's dependence on imported fertilizers. The corporation is set to issue tenders for an impressive additional one million metric tons each year, aligning with India's comprehensive green hydrogen ambitions. Furthermore, SECI is also gearing up to invite tenders for green methanol to promote domestic usages.

NEW DELHI, - State-owned Solar Energy Corporation of India is looking to supply an additional 1 million metric tons of locally produced green ammonia to fertiliser makers annually, its managing director said on Friday, as India seeks to reduce reliance on imports.

This follows SECI's announcement in March that fertiliser companies and local ‌suppliers, including ⁠clean ⁠energy solution company ACME Cleantech and NTPC Green, had signed offtake agreements for 724,000 tons of green ammonia - a derivative of green hydrogen - which could cover one third of the country's requirements of the low-carbon fuel.

The 1-million-ton supply proposal will be based on tenders only, SECI's Akash Tripathi said.

India's fertiliser sector uses about 20 ​million tons of grey hydrogen annually, imported or ⁠produced from ‌imported natural gas, Tripathi said at a Confederation of ​Indian Industry ​event on Friday, whose supplies have been disrupted by the ⁠Iran war.

Hydrogen extracted using renewable power such as ​solar is "green" while grey hydrogen is extracted from coal ​or natural gas using steam-methane reforming.

Backed by incentives worth about $2.1 billion, India aims to produce 5 million tons of green hydrogen by 2030 in a quest to decarbonise industries and ensure its energy security. Its push comes as several Western countries have scaled back ambitious green hydrogen goals ‌from the start of this decade on cost constraints and slower-than-expected demand growth.

India has brought the price of producing ​green hydrogen ​as low as 279 ⁠Indian rupees (around $3) per kilogram, from around $5 per kilogram in 2023, when the government launched its National Green Hydrogen Mission.

Under the initiative, industrial heavyweights including Larsen & Toubro, Bharat Petroleum Corp, GAIL and JSW Steel produce about 8,000 tons of green hydrogen and its derivatives annually. SECI pools demand and secures supplies.

Tripathi said SECI was also preparing green methanol tenders targeted at the domestic market and expected to issue them within the next two months.