Essar marks clean energy pivot, plans 1 GW green hydrogen complex in Gujarat

India's Essar group announced plans to invest up to ₹56,000 crore in the state of Gujarat, most of it in a green hydrogen complex marking the conglomerate's pivot to green energy in India. The group said it had signed three Memoranda of Understandings (MOUs) with the Government of Gujarat ahead of the Vibrant Gujarat Global Summit 2024. These are:

• Investment in Energy Transition: Essar will develop a 1 GW green hydrogen project at an estimated investment of ₹30,000 crore. There are indications this could take the form of green ammonia with sales targeted at UK and international markets.
• Investment in Power Generation: Essar Power announced an additional investment of ₹16,000 crore for Phase-II expansion at its Salaya Power Plant.
• Investment in the Ports Sector: Essar Ports will transform its Salaya port into a logistics hub with an investment of ₹10,000 crore.

Essar, which is turning around after selling assets in telecom, oil refining and steel to settle more than $25 billion of debt, said it was in a renewed phase of making strategic investments.

In February this year, the group announced the formation of a distinct vehicle – Essar Energy Transition – with plans to invest a $3.6 billion in developing a range of low-carbon energy transition projects over five years. Of this, about $2.4 billion would be invested across sites in the UK and $1.2 billion is planned for investment in India.

In a release, Essar claimed that it had invested more than ₹1 lakh crore in the energy, metals & mining and infrastructure sectors in Gujarat over the last four decades, and the new MoUs further signified the group's commitment to the state.

Prashant Ruia, Director at Essar Capital, commented, "Gujarat has consistently been at the forefront of Essar's strategic investments. We are delighted to further contribute to the state's economic progress with an additional investment of ₹55,000 crore in the energy and infrastructure sectors."

Essar Capital monitors the portfolio of investments owned by group holding company Essar Global Fund Ltd (EGFL). EGFL, which is the ultimate holding company of EET, claims its portfolio companies have aggregate revenues of $15 billion.