Jakson Green Invests $470M in Green Hydrogen
05.21.2024 By Tank Terminals - NEWS

May 21, 2024 [Energy News]- Jakson Green’s substantial investment underscores its commitment to renewable energy expansion. The ₹3,500 crore investment is being channeled through private equity investors and non-recourse financing routes, focusing on both solar utility projects and the burgeoning green hydrogen sector. This financial commitment is part of a broader strategy to develop a diversified renewable energy portfolio, including solar, hydrogen, methanol, and ethanol.

 

In less than two years of operation, Jakson Green has achieved a global solar project capacity of 5 gigawatts-peak (GWp), including 1 GWp of assets it directly owns. This rapid growth is impressive and aligns with industry standards for ambitious renewable energy firms. However, maintaining this momentum while expanding into new sectors like green hydrogen will be a critical challenge.

Jakson Green’s foray into green hydrogen involves pilot projects targeting industrial applications such as refineries and steel plants. Additionally, the company is set to commission a green methanol project and is actively exploring green methanol use in shipping, reflecting global trends towards sustainable marine fuels. These initiatives are commendable but must be viewed within the context of the current economic and technological landscape.

One of the major hurdles in the green hydrogen sector is the high production cost compared to conventional fuels. CEO Bikesh Ogra acknowledged this, noting that the levelized cost of green methanol and ethanol remains significantly higher than their conventional counterparts. Jakson Green’s efforts to narrow this cost gap are crucial, yet achieving cost parity will require significant technological advancements and economies of scale.

The technological readiness of green hydrogen projects is another critical factor. While Jakson Green is confident in its capabilities, the broader industry is still grappling with the scalability and efficiency of hydrogen production and storage technologies. Successfully addressing these challenges will determine the feasibility and sustainability of Jakson Green’s ambitious projects.

Jakson Green is strategically eyeing the Middle East for its green energy projects, leveraging the region’s competitive electricity costs. This move aligns with the company’s strong presence in the solar EPC (Engineering, Procurement, and Construction) segment in the MENA (Middle East and North Africa) region. The competitive advantage provided by lower electricity costs could be pivotal in reducing overall production costs for green hydrogen and methanol.

To support its expansion, Jakson Green is pursuing non-recourse financing and has secured promising commitments from several partners for equity raises at the asset level. Collaborations with development financial institutions (DFIs) and non-banking financial companies (NBFCs) are also in advanced stages. These financial strategies are crucial for sustaining the company’s aggressive growth targets, including adding 1 GW of assets annually from 2026.

 

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