French energy major TotalEnergies (Total) will buy a 25 per cent stake in Adani New Industries (ANIL) – as part of a deal with its parent company Adani Enterprises to develop the world’s biggest hydrogen ecosystem.
ANIL aims to invest $50bn over a decade in green hydrogen generation and development.
In the initial phase, it plans to develop up to one million tonnes per year of green hydrogen production by the end of decade.
Green hydrogen produced by splitting water into hydrogen and oxygen using renewable electricity – in contrast to blue hydrogen which relies on natural gas.
The development plans come amid a flurry of green investment activity in India, with the country’s government incentivising spending plans in renewable projects.
Alongside Adani Enterprises, giants such as Reliance Industries and Indian Oil Corp have also pledged to invest billions of dollars to develop clean energy projects in the country.
India, the world’s third-biggest emitter of carbon dioxide – and ANIL’s project will go some way towards plans to collectively produce 5m tonnes of green hydrogen annually to help the country reach net-zero carbon emissions by 2070.
Hydrogen attracts investors as firms shift to renewables
Adani Group already has a tie up with Total for building liquefied natural gas terminals, gas utilities and renewable energy business in India.
Total is one of the world’s biggest oil and gas producers, and has enjoyed soaring earnings from record fossil fuel prices – intensifying criticism from cliamte activists and fuelling moves towards windfall taxes and levies across Western economies.
However, it has also been shifting into the renewable energy sector and diversifying away from hydrocarbon-centred activities in recent years.
This includes the mass production of green hydrogen, with the energy giant convinced the market will take off by the end of the decade.
Patrick Pouyanne, chief executive of TotalEnergies, argued the entry into ANIL “is a major milestone in implementing our low-carbon hydrogen strategy.”
Gautam Adani, founder of Adani Group, said: “Our confidence in our ability to produce the world’s least expensive electron is what will drive our ability to produce the world’s least expensive green hydrogen. This partnership will open up a number of exciting downstream pathways,”
Apart from decarbonising hydrogen used in its European refineries by 2030, Pouyanne said the French energy major also plans to pioneer the mass production of green hydrogen as it expects that market to take off by the end of this decade.
Green hydrogen is attracting considerable attention from investors, with Protium revealing a record domestic funding round for the energy source last week.