India signs its first-ever agreement to export green ammonia to Japan

India has achieved another milestone by signing its first-ever agreement for the export of green ammonia to Japan. Formalized as a project offtake agreement, the contract marks a significant step forward in India’s journey towards becoming a global leader in green hydrogen and ammonia production. The signing ceremony was chaired by the Union Minister of New and Renewable Energy, Pralhad Joshi, and attended by several Indian government officials alongside their counterparts from Japan.

Referred to as the Heads of Terms (HoT), the agreement was signed by Sembcorp Industries, Sojitz Corporation, Kyushu Electric Power Co., and NYK Line, solidifying a cross-border green ammonia supply partnership from India to Japan. This agreement represents the first such collaboration between the two nations, underscoring India’s growing prominence in the global green energy landscape.

Under the agreement, Sembcorp Industries will lead the production of green ammonia in India, utilizing renewable energy sources. Additionally, Kyushu Electric Power Co. has committed to integrating this green ammonia into their energy mix, partially replacing coal consumption at their thermal power plants in Japan. Sojitz Corporation will act as the business intermediary, facilitating the connection between the ammonia producer and the offtaker, and NYK Line will oversee the maritime transportation of the green ammonia from India to Japan.

"Today is a historic day as we mark the first-ever agreement for the supply of Green Ammonia from India to Japan. This agreement will help establish a robust supply chain from production in India to consumption in Japan, paving the way for future collaborations in the green energy sector," stated Joshi while emphasizing the importance of this partnership.

Rapid progress
The Minister highlighted India's rapid progress in green hydrogen and renewable energy under the leadership of Prime Minister Narendra Modi. He reiterated India’s commitment to becoming a global leader in green hydrogen and ammonia production, leveraging partnerships, building robust regulatory frameworks, and making substantial investments in the sector.

Joshi also announced that a tender for 7.5 lakh tonnes per annum (TPA) of green ammonia is currently live, with additional tenders for 4.5 lakh TPA capacity have also been floated. These efforts are part of India’s broader strategy to award incentives for the production of over a million tonnes per annum of green hydrogen, demonstrating India’s capability and intent to scale up green energy production at an unprecedented pace. Meanwhile, India, Japan, and Singapore have developed deep cultural and people-to-people ties. These three partners are collaborating on energy efficiency and renewable energy technologies. This agreement is just the beginning of India’s expanding capabilities in the green energy sector, with future endeavours expected to be even more ambitious and impactful.

This agreement not only reinforces India’s position as a key player in the global green energy market but also reflects the Government of India’s steadfast support for green hydrogen and renewable energy initiatives. The collaboration with Japan is a testament to India’s growing expertise and commitment to sustainable development and energy independence.

National Hydrogen Mission
In August 2021, India announced the Green Hydrogen Mission, a major policy enabler, to make the country a global production hub for green hydrogen and green ammonia. Through enabling policies, the government believed to achieve the climate targets. Additionally, the country is targeting to reduce its dependence on fossil fuels and scale up its renewable energy capacity 500 gigawatt. The aim is to bring down the cost of green hydrogen to US$1.5 per kg and have five million tonnes per year of green hydrogen capacity by 2030.

India has an advantage here due to its geographical location, climate conditions and abundance of renewable sources of energy like solar, wind and hydropower making it ideal for becoming the world’s cheapest hub for green hydrogen by 2050. The initial measure in the strategy enables more flexibility for hydrogen producers in terms of sourcing and development of renewable electricity. It offers liberty to set up renewable capacity for green hydrogen anywhere by manufacturers themselves or with a developer. A key measure mentioned in the strategy is that the renewable energy used for green hydrogen production will get open access. This is expected to bring down the cost of green hydrogen production by 40 to 50 percent. A single portal will be established for all statutory clearances which would be provided within 30 days of receipt of application.

The Mission targets setting up of at least 5 MMT (million metric tonne) per annum of green hydrogen capacity with an associated renewable energy capacity of about 125 GW by 2030. The targeted production capacity will bring over Euro 2.24 billion in total investments. It is expected to have a total of Euro 90 billion in investments by 2030 in India. To reach this production target, the government aims for 15 GW of electrolysis capacity. The Mission proposes to create 600,000 jobs across the sector. Cumulative reduction in fossil fuel imports is expected at over Euro 11.4 billion. Further, it is expected an abatement of nearly 50 MMT of annual greenhouse gas emissions, and expected total investment of over Euro 90 billion in green hydrogen by 2030.


By Dr. Sajjid Mitha (Founder and CEO)
POLYMERUPDATE / POLYMERUPDATE ACADEMY / RACE CONFERENCES
sajjid.mitha@polymerupdate.com