Page 183 - CW E-Magazine (17-12-2024)

Special Report

term in case of a reduction in the total constraints for its adoption. The deve- says Maulesh Desai, Director, CareEdge
cost of ownership vis-à-vis electric, lopment of a manufacturing cluster of Ratings.
diesel and CNG vehicles. GH2 nearer to the consumption centre
may help in addressing this risk. More- “From the demand perspective, the
For the steel sector, the proportion over, the lower cost for transportation absence of long-term offtake arrange-
of hydrogen cost to total cost of pro- of green ammonia and competitive ment of GH2 would be the key issue for
duction is much lower. Hence, GH2 renewable energy cost in India augur developers and lenders. Hence, incen-
can partially replace coking coal in well for the port-based facilities for tivising downstream users of GH2 over
blast furnaces and replace natural gas exports of green ammonia. the use of other alternatives would be
in electric arc furnaces leading to its critical for gradual migration towards
wider adoption in the steel industry CareEdge Ratings view GH2. Refi neries can be one of the early
subject to capex for technology upgra- “Cost parity of GH2 with alter- users of GH2 and can lead to a potential
dation. natives is essential for its wide-scale demand of 2.70-3.00 mt of GH2 over
adoption. A higher capex outlay of FY27-FY30. Ammonia can also be a
GH2 can also be blended with natu- around Rs. 2.4 lakh-crore for 1-mtpa probable early adopter for GH2, subject
ral gas in city gas distribution. GH2 plant is also one major constraint. to price parity of green ammonia with
Given the limited headroom for reduc- ammonia produced from natural gas.
Needless to emphasise, overall GH2 tion in renewable energy capex cost, Adoption of green ammonia can lead to
demand shall be driven by an increased lowering of electrolyser costs by 35- a potential demand of 3.75-4.25 mt of
focus on reducing carbon emissions, 40%, improvement in effi ciency by GH2 over FY27-FY30 of which one-
requiring continued policy support and 12-14% and continued policy support third demand may be from non-urea
industrial acceptance. are critical for achieving cost viability sector. Besides, green ammonia also
of GH2 to around $2.1 per kg. Techno- holds signifi cant export potential due
Storage and transportation logical advancement in the electrolyser to competitive renewable energy cost
challenges manufacturing ecosystem, cost reduc- in India if the issue with respect to its
The low volumetric energy density tion in stack material and economies storage and transportation is adequately
of GH2 increases its storage and trans- of scale shall be key drivers for cost managed,” says Hardik Shah, Director,
portation costs. This is also one of the reduction of electrolysers in future,” CareEdge Ratings.

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