A tender floated by the Indian government on June 7, 2024, for the supply of green ammonia to fertiliser companies has still not been concluded due to a tepid response from bidders.
State-owned Solar Energy Corporation of India (SECI), the implementing agency of the National Green Hydrogen Mission (NGHM), has given a record 11th extension to its 724,000-tonne green ammonia tender, with the last date for submission of bids now set as July 10 (online) and July 14 (offline).
Earlier, the last date for submission for the tender, which marks the government's foray into green ammonia sector, was June 30, 2025, and prior to that, June 26. The extension highlights the government's acknowledgement of the sector's nascent state and the need for bidders to fully understand the complexities involved in a rapidly evolving industry.
Green ammonia is made by mixing nitrogen from the air with hydrogen produced from water using renewable energy (RE) sources, like wind or solar power. It is primarily used in fertiliser production, as a clean fuel for shipping, and as a potential energy carrier for storing and transporting hydrogen.
The tender is part of the Strategic Interventions for Green Hydrogen Transition (SIGHT) Scheme – Mode 2A, Tranche I. It focuses on the production and long-term supply of 724,000 tonnes of green ammonia each year to 13 fertiliser plants across India.
SECI will aggregate demand and enter into long-term offtake agreements with selected green ammonia producers. These agreements will provide commercial certainty for a 10-year duration and support market development for green hydrogen derivatives.
However, with more than a year already gone, SECI has not been able to move to the bid opening stage yet. If the latest deadline is not extended further, the opening of bids will be on July 15. The bidding will be conducted through SECI’s e-reverse auction platform, ensuring transparency and competitive price discovery.
Why the delay?
The delay is attributed to repeated feedback from the industry, which has compelled the government to amend multiple clauses in the tender at least five times so far. For example, the trade margin to be charged by SECI to the green ammonia producer was reduced from Rs 2 per kg to Rs 1.5 per kg in June this year.
Earlier, the government had not provided any assurance of a payment security mechanism.. Now, the Ministry of New and Renewable Energy (MNRE) has made a provision for a payment security mechanism (PSM) to mitigate payment risks from fertiliser companies, ensuring financial confidence for participating developers.
India’s current ammonia consumption stands at approximately 17 to 19 million tonnes annually, with over half of its hydrogen demand coming from the fertiliser sector — most of it sourced from imported natural gas.
The green ammonia tender is expected to reduce this dependency, cut exposure to global price volatility, and enhance energy security. Notably, green hydrogen production emits less than 2 kg of CO₂ per kilogram, compared to up to 12 kg CO₂ per kilogram of grey hydrogen.
