Mitsubishi study sees cost-cutting potential in India-Singapore green ammonia value chain
A study by Japan’s Mitsubishi Heavy Industries has found that costs of supplying Indian-produced green ammonia to bunkering markets in Singapore could be sharply reduced through better coordination and cost-optimization across production and transportation.
IMAGE: AM Green Ammonia Plant and Port Infrastructure at Kakinada, India. AM Green
The study published by Japan’s Ministry of Economy, Trade and Industry (METI) cited India’s low renewable power costs as a key reason the country could produce low-cost green ammonia. Along with bunkering markets, Singapore’s power markets were also considered as end users of the fuel.
Ammonia bunkering demand in Singapore is expected to start rising from 2035 and reach 40-60 million mt/year by 2050, the report said.
A model was created for the study to optimize the performance of facilities throughout the value chain from production to transportation. It showed costs could be reduced through closer coordination among companies involved in green ammonia production, transportation and supply.
The analysis showed green ammonia could become more cost-competitive with existing fuels if demand is built across sectors in bunkering, power and major industrial sectors in both India and Singapore.
Capital costs should also be lowered through low-interest finance and flexible renewable-power procurement, the report suggested.
The study also pointed out benefits from high-efficiency technologies such as SOEC electrolysers, and subsidies or preferential treatment that recognise lower-carbon ammonia and reduce its cost.
Cost reductions could also be achieved by adjusting operations to seasonal changes to renewable power generation in India.
Indian green ammonia producer Hygenco provided inputs for the study. The company is building a green ammonia project in the eastern Indian state of Odisha with an annual production capacity of 1.1 million mt.
By Nachiket Tekawade
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