GAIL, India’s largest gas company, will venture into hydrogen generation and expand its renewable energy portfolio through acquisitions as it expands its operations beyond natural gas to fit with the global energy shift.
GAIL Chairman and Managing Director Manoj Jain said that as part of a push to embrace greener types of energy, the company will build pipeline infrastructure to connect consumption centers to gas sources while also expanding its renewable energy portfolio. “In recent years, the global energy sector has witnessed a paradigm change as the world transitions to a sustainable energy future,” he said in the company’s most recent annual report. To establish a cleaner primary energy mix for India, the government is stressing the expansion of the natural gas sector in order to build a gas-based economy while also growing renewables. GAIL, as a renowned integrated energy company, has endorsed this ambition, he said. According to him, the company is laying approximately 6,000 kilometers of pipeline, including a west coast to east coast pipeline from Mumbai to Jharsuduga in Odisha via Nagpur. It now has over 13,700 kilometers of natural gas pipeline network. GAIL “will invest carefully in the renewable energy arena given the potential for future growth,” he stated. “The company has been exploring for chances to grow up the RE portfolio from the present 130 MW through bidding and other inorganic methods such as mergers and acquisitions,” according to the corporation.
“In addition, the corporation is venturing into ethanol and hydrogen generation,” he noted, without going into further detail. Hydrogen is a clean fuel that produces just water when burned in a fuel cell. Many countries are experimenting with hydrogen generation using a range of home resources, including natural gas, nuclear power, biomass, and renewable energy sources such as solar and wind. Companies ranging from Reliance Industries to Indian Oil Corporation and NTPC have revealed ambitious plans for hydrogen generation in India. GAIL has now been added to the list. GAIL, according to Jain, has the largest and most diverse LNG portfolio in India, allowing it to provide consumers with both stable prices and consistent supply. The company “shall be pushing for more gas utilization in the industrial segment, transport segment utilizing CNG and LNG, Trigeneration, cold storage, and so on,” he added, adding that the company was looking for new ways to provide gas, such as LNG trucking (LNG for long-haul transportation). He also stated that GAIL is trying to grow its footprint in petrochemicals as well as diversify into high-margin downstream areas. “The emphasis is on having polypropylene (PP) production capacity through the establishment of two polypropylene units (Propane Dehydrogenation Polypropylene Plant – PDHPP in Usar, Maharashtra and PP plant in Pata, Uttar Pradesh) and assessing opportunities in certain specialty chemicals in India,” he said. GAIL currently has a polyethylene and PP production capability of 1.6 million tonnes per year. It is also constructing at least two compressed biogas facilities as well as an ethanol factory. India, which imports 85 percent of its crude oil, is speeding up efforts to investigate new kinds of energy in order to clean up the skies and reduce reliance on imported fuels. “We have 120 MW of renewable energy capacity that we intend to develop up to 1GW in the next 3-4 years,” Jain said last month to PTI. GAIL will compete for a 400 MW solar power capacity auctioned off by SECI (previously Solar Energy Corporation of India) at Rewa, Madhya Pradesh. In 2019, the company won a bid for IL&FS’s 874 MW operational wind power projects worth Rs 4,800 crore. However, he stated that IL&FS’ other partners utilized the first right of refusal to block GAIL’s proposal. GAIL has partnered with BHEL, a state-owned power equipment manufacturer, for its renewable energy venture. The collaboration aims to capitalize on both organizations’ unique advantages. GAIL will develop the project, while BHEL will serve as project manager and EPC (engineering, procurement, and construction) contractor. GAIL’s decision is considered as part of the government’s goal to prepare for the energy transition process, in which the share of gas in the energy mix is targeted to be increased to 15% by 2030, from the present 6.2 percent.
