India’s renewable hydrogen/ammonia production costs are significantly higher than the willingness to pay from refineries and fertilizer manufacturers, a significant obstacle to deals.
India’s renewable hydrogen developers anticipate cost advantages and offtake interest to boost “green ammonia” export opportunities in 2027, despite the industry’s uncertain future.
One of the main obstacles to transactions is the significant discrepancy between the price of producing renewable hydrogen and ammonia in India and the willingness of refineries and fertilizer producers to pay, according to market indicators on Platts Market Heards.
Platts Market Heards reports that renewable hydrogen costs were above $5/kg, but the willingness to pay remained below $4/kg. In 2024, Indian fertilizer companies imported conventional ammonia at an average price of $398/mt, while renewable ammonia was offered mostly around $800/mt on an FOB basis.
Platts assessed Queensland hydrogen produced via alkaline electrolysis at $4.32/kg, down 16.44% from a month ago. The next six or seven months will determine if Indian projects move to construction. The challenge lies in securing firm offtake deals and regulatory clarity, including the acceptance of RED III rules by EU states and the International Maritime Organization’s proposal for 5% blending of renewable fuels.
India aims to export over half of its 5 million mt renewable hydrogen production by 2030 from coastal states like Odisha, Andhra Pradesh, Tamil Nadu, Kerala, and Gujarat. The country’s competitive production of green hydrogen is crucial for regions like Europe, where specific mandates require green hydrogen consumption.
It must be noted that the National Green Hydrogen Mission is promoting the development of electrolyzers, hubs, and renewable hydrogen/ammonia. AM Green and ACME are aiming for production and exports in late 2026 or 2027.
According to Commodity Insight’s Hydrogen Production Assets database, India has 143 low-carbon or renewable hydrogen projects with a combined capacity of 10.55 million mt, with the government contributing Rs 197.44 billion ($2.37 billion).
