Adani group spends $2.5 bn so far on green hydrogen value chain

Adani New Industries Ltd (ANIL), a wholly owned subsidiary of flagship Adani Enterprises, has spent $2.5 billion so far in developing a backward integrated value chain for its green hydrogen project and is on track to implement the first phase of the project with an annual capacity of 1 million tons by FY27, sources said.

The aim is to increase the capacity to 3 million tons in the next ten years with an investment of $50 billion. This, of course, depends on market conditions and the success of the initial phase. The green hydrogen plant is coming up at Mundra in Gujarat.

The backward integration includes developing a fully integrated value chain across solar, wind, electrolysers, and allied equipment for the generation of green hydrogen and its associated sustainable derivatives.

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Solar energy can be used to produce hydrogen either by electrolysis of water with the use of solar-generated electricity or through solar water splitting.

Green hydrogen is one of the major thrust areas for the group and it is spending massively on the production of supply chain products for the generation of green hydrogen such as solar- polysilicon, ingots, wafer, cell and module, and wind turbine generators. Downstream derivatives product include green ammonia, green methanol, and sustainable aviation fuels.

The backward integration of the solar value chain, that is from polysilicon to modules, is being developed as part of the electronic manufacturing cluster at Mundra. JVs have been formed to produce ethylene vinyl acetate, back sheets, aluminium frames, and glass. ANIL has also developed a 5.2 MW wind turbine generator.

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In September Adani Enterprises had announced the formation of an equal joint venture with Kowa Holdings Asia Pte to sell and market green ammonia, green hydrogen and its derivatives in Japan, Taiwan, and Hawaii.

Funds will be raised by tapping the domestic bond markets as well as through bank loans and other lines of credit. Recently Group Chief Financial Officer Jugeshinder Singh that the group plans a massive $84 billion of investments in infrastructure projects over the next decade. He also indicated that the group plans to approach the domestic bond markets more in the future. Bulk of the group’s bond issuances so far have been in the US.