India launches subsidy scheme for renewable ammonia production

The Indian government has launched the next phase of its Strategic Interventions for Green Hydrogen Transition Programme (SIGHT), focused on an incentive scheme for renewable ammonia production. The Solar Energy Corporation of India will oversee a competitive bidding process, and award subsidies based on the lowest cost bids.

An aggregate demand of 550,000 tonnes per year has been set for this round of subsidies, which will run for three years from 2027. Producers must meet the national “green hydrogen standard” carbon intensity guidelines set out in August 2023. The incentive amounts have already been set: US$106 per tonne of ammonia in the first year, US$85 per tonne in the second year, and US$85 per tonne in the third year.

Winners for hydrogen, electrolyser subsidies announced

The news comes as the first winners for government subsidies under the SIGHT Programme are announced. For the production of renewable hydrogen, nine projects with a total capacity of 410,000 tonnes per year will receive subsidies. Two winners – a facility on India’s east coast being developed by Calcutta Electric Supply Corporation and chemical giant UPL Ltd’s plant at an undisclosed location – submitted zero-subsidy bids. Key ammonia players ACME, Reliance and Greenko featured in the winner’s list, but Avaada and Sembcorp both missed out in this round.

For the domestic production of electrolysers, 1.5 GW per year manufacturing capacity spread over eight facilities has been awarded subsidies, including 300 MW per year of units featuring “indigenously developed” stack technology. The winner’s list for this round included Indian multinational Reliance, John Cockerill (which has already announced its electrolyser manufacturing plant in Kakinada), and US-based Ohmium. Ohmium launched operations in India in 2022, and already has an agreement to manufacture PEM electrolysers for Indian utility NTPC.

Financial assistance for new build vessels powered by green fuels

In December, India’s Ministry of Ports, Shipping and Waterways announced an existing incentive scheme would be amended to support the construction of alternatively-fueled vessels. For electric or hybrid-powered vessels, 20% assistance will be provided, increasing to 30% if the vessel’s main propulsion is via “green fuels” (ammonia, methanol, hydrogen and/or fuel cells). Over the last four years, the government reports that 88 vessels have been ordered and 69 delivered by Indian shipyards under the scheme – and these numbers are expected to grow now that alternative fuels are included.