At the India Energy Week held in January 2026, Prime Minister Narendra Modi outlined India’s ambition to become not merely energy-secure but energy-independent, identifying clean energy investment opportunities worth $500 billion. Within this vast landscape of India’s energy transition, a relatively less-publicised but extraordinarily significant development has been quietly unfolding: India’s green ammonia auction conducted by the Solar Energy Corporation of India (SECI) under the Strategic Interventions for Green Hydrogen Transition (SIGHT) programme of the National Green Hydrogen Mission (NGHM).
The results of this auction, which concluded in August 2025, have attracted global attention because the discovered prices for green ammonia were almost 40–50 percent lower than comparable prices from the European Union’s H2Global auction. With 15 bidders participating and seven unique successful awardees, India’s green ammonia procurement framework is now being described as a potential global benchmark for clean energy adoption. Understanding this development requires situating it within India’s broader energy transition strategy, the global landscape for green hydrogen and its derivatives, and the economic and environmental implications of scaling up green ammonia.
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Table of Contents
What is Green Ammonia and Why Does It Matter
Five Important Key Points
- Green ammonia is produced by combining nitrogen with green hydrogen derived from renewable energy sources, making it a fully decarbonised version of conventional (grey) ammonia.
- India currently imports grey ammonia at prices as high as $515 per tonne; the SECI auction has discovered green ammonia prices ranging from ₹49.75 to ₹64.74 per kg ($572–$744 per tonne), making the cost gap significantly narrower than previously.
- The SECI tender under the SIGHT programme covered an aggregated demand of up to 724,000 tonnes of green ammonia annually, to be delivered to 13 fertiliser plants, with 10-year fixed-price offtake agreements.
- India’s auction attracted broader market participation than comparable global efforts, with successful bidders receiving production subsidies of ₹8.82, ₹7.06, and ₹5.3 per kilogramme for the first three years respectively.
- The contracted volumes of green ammonia represent approximately 30 percent of India’s total ammonia imports, providing price predictability and insulation from global gas market volatility.
Ammonia (NH₃) has a wide range of applications — it is the primary feedstock for nitrogen-based fertilisers, which underpin agricultural productivity worldwide. Conventional ammonia production uses the Haber-Bosch process, which relies on natural gas or coal as the hydrogen source, making it one of the most carbon-intensive industrial processes globally. The fertiliser sector alone accounts for approximately 1–2 percent of global greenhouse gas emissions. Green ammonia, produced using green hydrogen generated through electrolysis of water powered by renewable electricity, eliminates these emissions entirely.
Beyond fertilisers, ammonia has emerged as a leading green shipping fuel candidate, a medium for hydrogen transportation, and a potential industrial fuel. The International Maritime Organization’s decarbonisation targets have placed green ammonia at the centre of the global shipping transition. Countries including Japan, South Korea, Germany, and the Netherlands have made green ammonia imports a central pillar of their decarbonisation strategies.
India’s SIGHT Programme and the SECI Auction Design
The National Green Hydrogen Mission, launched in January 2023 with an outlay of ₹19,744 crore, established the SIGHT programme as its central demand aggregation mechanism. SIGHT has two components: support for domestic green hydrogen production and support for the manufacture of electrolysers. The green ammonia auction under SIGHT represents SIGHT’s most ambitious implementation so far.
The auction design incorporated several innovative features that distinguished it from comparable global efforts. First, SECI pre-identified delivery points at fertiliser plants located near coastal areas, which enabled the use of shipping for green ammonia transportation — a critical logistical advantage that reduces inland transportation costs and allows flexible sourcing from coastal green energy production sites.
Second, the 10-year fixed-price offtake agreements provided the long-term revenue certainty that project developers require to secure financing for capital-intensive green hydrogen and ammonia production facilities. Project finance for renewable energy projects is typically constrained by offtake risk — the uncertainty about whether and at what price the output will be purchased. By aggregating demand across 13 fertiliser plants and offering fixed-price long-term contracts, SECI effectively de-risked the offtake side of the equation.
Third, the production subsidies covering the first three years of operation were designed to bridge the initial cost gap between green and grey ammonia, allowing projects to ramp up while renewable energy costs continue their trajectory of decline.
Significance of the Price Discovery
The price discovery achieved through this auction is genuinely transformative in its implications. The discovered prices of ₹49.75–₹64.74 per kg represent a 40–50 percent reduction compared to the H2Global auction in Europe, which is currently the most referenced benchmark for green ammonia procurement globally. This is not merely an academic price comparison — it reflects the combination of factors that give India a structural cost advantage in green ammonia production: abundant renewable energy resources (solar irradiation and wind speeds), falling solar and wind LCOE (Levelised Cost of Energy), large-scale project development experience, and a favourable regulatory environment under the NGHM.
India’s grey ammonia import price of approximately $515 per tonne, combined with green ammonia prices now in the range of $572–$744 per tonne, means the green premium has narrowed to 10–45 percent depending on the specific contract. When factors such as carbon pricing, ESG-linked financing costs, and regulatory risk from evolving global carbon border mechanisms are incorporated, the economics of green ammonia become increasingly competitive.
This price trajectory is significant for India’s fertiliser security. India is one of the world’s largest importers of ammonia and urea, with fertiliser imports creating significant foreign exchange outflows and vulnerability to global gas price shocks — as dramatically demonstrated during the 2021–2022 energy crisis following Russia’s invasion of Ukraine, when natural gas prices in Europe spiked over 400 percent, driving up global ammonia and urea prices and creating fertiliser affordability crises across the developing world.
Environmental and Agricultural Implications
From an environmental perspective, the green ammonia transition directly addresses India’s Nationally Determined Contributions (NDCs) under the Paris Agreement. India has committed to achieving 500 GW of renewable energy capacity by 2030 and reducing the emissions intensity of its GDP by 45 percent by 2030 compared to 2005 levels. The fertiliser sector’s decarbonisation through green ammonia is one of the most direct pathways to achieving industrial emissions reductions.
For agriculture, the availability of domestically produced green ammonia has the potential to reduce the structural dependence on imported fertilisers, which has been a persistent vulnerability in India’s agricultural input supply chain. The fertiliser subsidy bill, which crossed ₹2.5 lakh crore in 2022–23 due to global price spikes, represents one of India’s largest and most volatile budget items. Substituting imported grey ammonia with domestically produced green ammonia — at long-term fixed prices — would provide greater budget predictability and reduce geopolitical exposure.
Challenges to Scaling Up
Despite the impressive auction results, significant challenges remain in translating contracted volumes into actual production and delivery. The renewable energy infrastructure required for large-scale green hydrogen production — particularly dedicated offshore wind and large-scale solar parks — requires substantial capital investment and grid infrastructure development. Electrolyser manufacturing capacity, while growing, remains a constraint, with India still largely dependent on imported electrolysers despite policy incentives for domestic manufacturing.
The integration of hybrid renewable systems with storage is essential to ensure continuous hydrogen production at the volumes required for 724,000 tonnes of annual green ammonia, since solar and wind are intermittent sources. Grid access and banking regulations, which govern how renewable energy producers interact with the electricity grid, require harmonisation to support the green hydrogen economy.
Furthermore, the certification and standards framework for green hydrogen and green ammonia — including internationally recognised green credentials that allow export market access — is still evolving both in India and globally. Alignment with EU, Japanese, and South Korean certification frameworks is necessary for India to position its green ammonia competitively in global markets.
Way Forward and Global Leadership
India’s approach to green ammonia procurement is increasingly being examined by other countries as a model. The combination of demand aggregation, long-term fixed-price offtake, production subsidies, and coastal delivery infrastructure creates a replicable framework that developing countries with abundant renewable resources can adapt.
For India to consolidate its emerging leadership in global clean ammonia markets, the next steps must include sustained policy stability, continued scaling of the NGHM, investments in electrolyser manufacturing, regulatory reforms on grid access and banking, and active engagement in international forums to shape green hydrogen certification standards in a manner that recognises India’s renewable energy cost advantage.
Relevance for UPSC and SSC Examinations
This topic is directly relevant to UPSC GS Paper 3 (Environment and Ecology, Energy Security, Indian Economy, Agriculture), and connects to GS Paper 2 (Government Schemes — National Green Hydrogen Mission, SIGHT, SECI). For Essay Paper, themes of India’s energy transition, clean energy leadership, and sustainable agriculture provide excellent analytical frameworks within which this development can be situated.
For SSC examinations, questions on renewable energy, government schemes related to clean energy, and India’s environmental commitments under the Paris Agreement are regularly examined in General Awareness sections.