Subscribe
On 27 February 2026, the Union Ministry of New and Renewable Energy (MNRE) published the standard definition for green methanol in India. This was followed by the announcement of India’s first green methanol bunkering facility and the release of a draft tender for ‘Production and supply of Green Methanol’ as part of the National Green Hydrogen Mission. The tender was issued by Solar Energy Corporation of India (SECI), under the Strategic Interventions for the Transition to Green Hydrogen Programme (SIGHT) as a preliminary step to facilitate domestic production and supply of green methanol.
Methanol is widely used across several industrial applications, including production of paint, resin and solvent, chemical processing and fuel blending. In India, pharmaceutical and chemical sectors are the primary consumer of methanol.
Traditionally, methanol is produced using syngas, a combustible gas mixture of hydrogen (H2), carbon dioxide (CO2) and carbon monoxide (CO). The carbon components of syngas require carbon-based raw materials, which is fetched through coal and natural gas as feedstock. The final product has a high carbon emission intensity (ranging between 1.46 kg CO2eq/t to 3.95 KgCO2eq/t production) and is termed ‘grey methanol’. With the introduction of the new guidelines by MNRE, ‘green methanol’ is defined as ‘methanol as a product’ whose emission arising from the synthesis process including ‘Green Hydrogen production, methanol synthesis, purification, and on-site storage shall not exceed 0.44 kilogram of carbon dioxide equivalent per kilogram of methanol (kg CO2 eq/kg CH3OH), calculated as an average over the preceding 12-month period’. It is further mandated that for the synthesis process, ‘carbon dioxide may be sourced from biogenic sources, Direct Air Capture (DAC), or existing industrial sources’ while using green hydrogen as primary fuel source. Introduction of this formal definition has established regulatory clarity to project developers, investors and industrial consumers.
Globally, different industrial sectors are seeking solutions to decarbonise their production and services. Green methanol is one of the many options with potential use as both chemical feedstock, as well as alternative fuel source.
The release of the draft green methanol tender will drive confidence among investors across the broader value chain for green technologies. This includes green hydrogen, renewable energy production, electrolyser manufacturing, carbon capture and utilisation (CCUS) technologies, storage facilities and logistics networks.
According to Parth Kumar, Programme Manager at the Centre for Science and Environment, “The recent developments on green methanol in India is a crucial addition to India’s green taxonomy stride across sectors.” He further noted that “a simultaneous development of an ecosystem for demand creation of green methanol will be critical to scale its production”.
As governments around the world are enacting tougher environmental regulation around greenhouse gas (GHG) emissions from the shipping sector, the demand for cleaner alternatives to heavy fuel oil (HFO) is increasing. One of the cleanest near-term alternatives to HFO is green methanol. Methanol engine technology for marine applications is commercially available today. International shipping companies have commenced ordering and deploying methanol-fuel-ready vessels as part of their overall green transition plan.
On 2 April, 2026, Deendayal Port Authority (DPA), located in Kandla, Gujarat successfully conducted a shore-to-ship methanol bunkering trail. The operation successfully validated readiness of infrastructure and operational protocols. This is a first of its kind project in the country. The Minister of Ports, Shipping and Waterways (MoPSW) expects demand for green to reach 500,000 tonnes per annum by 2028-29. This demand is only for 1 out of the 12 major ports (operational) and 251 total ports in the country. This reflects the potential scale of green methanol demand within India’s maritime sector in the coming years.
The draft stakeholder consultation reflects a broader policy approach in decarbonising India’s economy. However, large scale deployment of green methanol will continue to be dependent on other economic and technological determinants, including production costs of renewable electricity, costs of electrolysers, green hydrogen availability, and the commercial readiness of carbon capture and utilization (CCUS) technology.
Green methanol is ever more frequently contemplated as both a marine fuel, as well as a potential low carbon industrial feedstock. As industries consider alternatives to fossil-based fuels/feedstock options, India’s evolving policy framework along with its procurement initiatives will dictate the rate at which the domestic production and necessary infrastructure develop within India in the near future.