India – June 23, 2025 – In a pivotal move towards achieving its ambitious net-zero carbon emissions target by 2070, India today announced the launch of a "Landmark Green Ammonia tender" by the Solar Energy Corporation of India (SECI). This significant initiative is specifically aimed at decarbonizing the nation's critical fertilizer sector and underscores India's unwavering commitment to clean energy and reducing its carbon footprint in key industries.
The tender, issued under the Strategic Interventions for Green Hydrogen Transition (SIGHT) Scheme - Mode 2A, Tranche I, seeks the annual production and supply of 724,000 tonnes of green ammonia across 13 fertilizer plants in the country. Green ammonia, produced using green hydrogen (which is generated through the electrolysis of water powered by renewable energy), represents a far cleaner alternative to conventional ammonia production that heavily relies on imported fossil fuels like natural gas, a major contributor to greenhouse gas emissions.
"This tender is a game-changer for India's fertilizer industry and a strong statement of our resolve to transition to a green economy," stated a senior official from the Ministry of New and Renewable Energy (MNRE). "It will not only reduce our carbon footprint but also enhance our energy security by cutting down reliance on volatile global fossil fuel markets."
Key Highlights of the Tender:
- Massive Scale: The tender targets a substantial volume of green ammonia, indicating a serious intent to rapidly integrate sustainable practices into a major industrial sector.
- Demand Aggregation and Market Certainty: SECI will act as a demand aggregator, entering into 10-year long-term offtake agreements with selected producers. This crucial step provides market certainty and de-risks investments for companies looking to establish green ammonia production facilities.
- Financial Incentives: To ensure the financial viability and encourage participation, the government is offering Production Linked Incentives (PLI) under the National Green Hydrogen Mission. These incentives amount to ₹8.82 per kg in the first year, ₹7.06 per kg in the second, and ₹5.30 per kg in the third, totaling a substantial support of ₹1,533.4 crore.
- Payment Security Mechanism (PSM): A robust Payment Security Mechanism committed by the Government of India aims to mitigate potential payment delays from fertilizer companies, assuring suppliers of steady cash flows and fostering greater participation and easier financing for these projects.
- Transparent Bidding: The bidding process will utilize SECI's proven e-reverse auction model, ensuring competitive pricing and transparency.
- Reducing Import Dependence: India currently consumes 17-19 million tonnes of ammonia annually, with over 50% of its hydrogen requirement for fertilizer production derived from imported natural gas. This initiative is expected to drastically cut this dependence, reducing exposure to global gas price fluctuations and lowering the trade deficit.
- Environmental Benefits: Producing green hydrogen emits less than 2 kg of CO₂ per kilogram, a stark contrast to the up to 12 kg of CO₂ emitted from conventional grey hydrogen. This shift will lead to significant decarbonization.
- Job Creation: Domestic green ammonia production is also anticipated to generate new employment opportunities across the clean energy, manufacturing, and infrastructure sectors.
The tender, which was initially issued on June 7, 2024, has a final bid submission date of June 30, 2025. This tight deadline underscores the government's urgency in advancing its green energy agenda.
This landmark tender represents a decisive step in addressing the "chicken-and-egg" challenge often faced by the nascent hydrogen economy, by simultaneously stimulating both demand and supply for green ammonia. It aligns perfectly with Prime Minister Narendra Modi's vision of 'Viksit Bharat' – a developed, sustainable, and self-reliant India.
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