Discuss how the SIGHT programme under the National Green Hydrogen Mission seeks to reduce the cost of green ammonia. What challenges persist?

Green ammonia is ammonia made from hydrogen that is produced by electrolysis run on renewable power. It still costs more than fossil-based "grey" ammonia. The SIGHT (Strategic Interventions for Green Hydrogen Transition) programme gets ₹17,490 crore of the Mission's ₹19,744 crore outlay [1]. It tackles this cost gap on both supply and demand, but structural hurdles remain.

How SIGHT lowers the cost of green ammonia

• Cheaper electrolysers (Component I): incentives for domestic manufacturing; 1,500 MW/yr of capacity has been awarded [4]. Scale and indigenisation cut the largest capital cost.
• Production incentives (Component II): direct support narrows the per-kg gap with grey ammonia [1]. Tenders have been awarded for 4.12 lakh t/yr of green hydrogen [4].
• Demand aggregation (Mode-2A): SECI acts as the intermediary buyer. It pools demand from fertilizer units into 13 auctions totalling 7.24 lakh t/yr [2]. The fertilizer allocation was raised from 5.5 to 7.5 lakh t/yr [3].
• Competitive price discovery: SECI's first auction found ₹55.75/kg (~USD 641/t) [2].
• Assured long-term offtake: buyers commit for years, which lowers lenders' risk and the cost of capital. Financing cost is a key driver of green hydrogen prices in developing economies [6].

Electrolyser incentive  → lower capex ┐
Production incentive    → lower opex  ├→ ₹/kg green ammonia ↓
SECI pooling + auctions → scale, assured offtake ┘

Fig: SIGHT's three cost levers

Challenges that persist

• Misleading benchmark: the ₹100.28/kg price from the 2024 H2Global auction [2] was for ammonia delivered to Europe and meeting EU "RFNBO" rules (renewable fuels of non-biological origin) [7]. So part of the "fall" to ₹55.75/kg reflects comparing different products, not only cheaper production.
• Scale gap: awarded capacity is only about 8% of the 5 MMT/yr 2030 target [1][4].
• Maturing procurement: SECI had to extend bid deadlines [5].
• Finance and infrastructure: capital is costly [6], and storage, transport and round-the-clock renewable supply are still thin.
• Export pull vs domestic use: AM Green's 10-year, €585 million H2Global deal with Germany [7] could divert low-cost output abroad while Indian fertilizer still runs on grey ammonia. Differing "green" certification rules add further friction.

SIGHT combines supply-side incentives with pooled, auction-based demand, and this has visibly pushed prices down. The next step is to close the green–grey gap for urea, align India's certification with the EU's, and extend pooled procurement to refineries and shipping. Doing so would advance the Mission's aim of making India a global green hydrogen hub [1], support SDG 7 and SDG 13, and help meet the Net Zero 2070 pledge.