Breaking Update: Here’s a clear explanation of the latest developments related to Breaking News:ACME Group plans $1.4 bn green methanol plant in Odisha, inks agreement– What Just Happened and why it matters right now.
Anil Taparia, chief operating officer (COO) at ACME Green Hydrogen and Ammonia Business Unit, said in an interview that the agreement for the greenfield plant has been inked with Industrial Promotion and Investment Corporation of Odisha Ltd (IPICOL).
ACME is in talks with several global shipping lines to sign offtake agreements, with the green methanol project to be commissioned by 2029-30.
“We are setting up multiple green hydrogen and ammonia projects around Paradip and Gopalpur for both domestic and export purposes,” Taparia said.
ACME already has a green ammonia facility in Gopalpur, Odisha, which is operated through its joint venture with Japan-based IHI Corp. The greenfield methanol project will be adjacent to another project for 2,200-tonne green ammonia, the company is setting up in Paradip in the state under the ₹19,000 crore National Green Hydrogen Mission.
This comes amid growing demand for green methanol, a derivative of green hydrogen, as global marine fuel standards tighten, including the European Union’s FuelEU Maritime Regulation and the International Maritime Organisation’s (IMO) targets. This, in turn, has attracted investments from AM Green, Adani Group, Reliance Industries Ltd, ReNew and Indian Oil Corp., and NTPC Green Ltd in India’s green hydrogen space.
The European Union’s FuelEU Maritime Regulation and the International Maritime Organisation’s (IMO) call for net-zero greenhouse gas (GHG) emissions in global shipping by 2050.
Sustainable fuels
Green methanol, green ammonia, and green hydrogen are considered sustainable green fuel options in the shipping industry. Green ammonia is produced from green hydrogen and nitrogen via the Haber-Bosch process, and green methanol is made by combining green hydrogen with captured carbon dioxide, according to The Energy Research Institute (Teri).
By 2030, the global green methanol market is expected to be driven primarily by shipping decarbonisation, with maritime demand estimated at 5–10 million tonnes per annum. According to industry estimates, Europe is expected to account for around 40–50% of import demand, with additional interest from hubs in Singapore, Japan, and South Korea.
Given global demand projections, the government is looking to develop India as an export hub for green hydrogen and its derivatives, including green methanol, backed by large-scale renewable capacity, port access, and policy support under the National Green Hydrogen Mission.
Taparia added that the abundant availability of biogenic feedstock, supportive industrial policies, and a low-cost green power supply have created a robust ecosystem in Odisha for the production of green methanol at globally competitive costs. He also said that the project would be funded through debt, internal accruals, with an equity fund raise also on the agenda, but no final decision has been taken yet.
“Discussions with several global financial institutions are underway. IPICOL will largely play the role of a facilitator for the project,” he said.
ACME Group has already set up a small-scale green ammonia project in Bikaner, Rajasthan. It is also developing a 0.1 million metric tonne per annum (MMTPA) green ammonia project in Duqm, Oman. By 2032, it aims to build a 10 MMTPA portfolio of green ammonia or equivalent green hydrogen.
Demand for green fuels
ACME has received six letters of award (LoAs) from Solar Energy Corporation of India Ltd (SECI) under the first tranche of the scheme for the supply of green ammonia to India’s fertilizer sector. Under the LoAs, ACME Group will supply 370,000 tonnes per year of green ammonia to some of India’s largest chemicals and fertiliser companies for 10 years.
The maritime sector is expected to be the primary sector requiring green methanol. Under the National Green Hydrogen Mission, Shipping Corporation of India is working to retrofit a few ships to run on green methanol, green hydrogen, or other derivatives by 2027.
According to Teri’s November 2024 report on green hydrogen, the choice between fuel cells and internal combustion engines depends on vessel type and operational requirements. Two broad categories of shipping, short-distance and long-distance, demand different technological solutions. “Short-distance shipping takes place on routes between nearby ports. The relatively shorter distances allow the use of cleaner energy, electric propulsion, and biogas,” the report said.
While noting that hydrogen-powered engines for shipping are also under development, green ammonia and green methanol are currently more favourable options, as they can provide the required energy for long routes, the report said.
Key Takeaways
- ACME is committing $1.4 billion to green methanol, marking one of the largest private investments in the sector in Odisha.
- The project will be part of a green cluster in Paradip and Gopalpur, benefiting from existing port infrastructure for exports.
- The primary target market is the maritime sector, driven by EU and IMO decarbonization mandates.
- ACME is actively seeking global debt and considering an equity raise to fund the 2029-30 project.
- ACME is positioning itself against major players such as Adani and Reliance in the race to make India a global hub for green molecules.