In a significant move to bolster the demand for green hydrogen and its derivatives, the Indian government has initiated a tender for the acquisition of hydrogen-based green ammonia.

The Solar Energy Corporation of India (SECI) has launched this tender with the objective of procuring 539 thousand tons per year of green ammonia over a span of 10 years. This procurement will be distributed across 11 projects, with delivery points strategically situated throughout the country.

Winning bidders are mandated to commence supplying the entire contracted capacity within 3 years from the signing of the supply contract. Moreover, they are permitted to either deliver green ammonia directly or sell it to third parties “at the expense of risk and cost” before the conclusion of the 3-year period.

To ensure compliance, projects must be fully operational one year prior to the commencement of supply and must meet the ammonia quality standards specified for each delivery point.

Notably, SECI has not stipulated a price ceiling and intends to adopt a reverse bidding mechanism, wherein bidders securing the lowest price emerge victorious.

As per the tender documents, estimated prices range from 80.08 to 86.15 Indian rupees (equivalent to 0.96–1.03 US dollars) per kilogram of ammonia, translating to 960–1030 dollars per ton. Carbon credits will not be factored into the price of ammonia. Additionally, bidders will not be eligible for subsidies to support the cost of green hydrogen production for the ammonia plant.

Winning bids will receive a 3-year government subsidy of INR 8.82 (USD 0.11) per kilogram of ammonia in the initial year, mirroring the existing subsidy for green hydrogen production.

Delivery points will be geographically dispersed to include fertilizer plants situated along the east and west coasts of India. Bidders opting not to produce ammonia at a common site with the delivery point will be required to cover additional transportation costs.

In a related development, JSW Energy, an Indian company, has announced the commencement of construction work for a battery storage project, marking its foray into the storage services sector. Furthermore, JSW is pioneering the development of India’s largest commercial-scale green hydrogen project, tailored for the green steel industry, with a capacity of 6,800 tons per year of green ammonia.