AM Green weighs $1 bn push into 2G fuels: report

Clean energy firm AM Green is weighing investing $1 billion in a second-generation (2G) biofuel venture by setting up two bio-ethanol facilities, Mint reported citing unidentified people aware of the company’s plans.

The company, which is backed by Greenko Group founders Mahesh Kolli and Anil Kumar Chalamalasetty, is also looking to buy a 50% stake in Assam Bio Refinery Pvt. Ltd from Finnish firms Fortum Oyj and Chempolis Oy, the report added.

While Oil India Ltd subsidiary Numaligarh Refinery Ltd holds a 50% stake in Assam Bio Refinery, Finnish state-run power utility Fortum owns a 40% stake and Finland-headquartered biotech firm Chempolis the rest.

Apart from these, AM Green is also looking to buy Chempolis, in which Fortum holds a stake. Finnish investment and asset management firm Taaleri Plc also owns a stake in Chempolis, which is the licensor of 2G biofuel technology for the world’s first such plant making cellulosic ethanol and bio-based chemicals from bamboo.

AM Green, which has signed exclusivity agreements for these transactions, plans to manufacture 2G biofuels from non-food biomass such as plant and animal waste, the report said.

While first-generation biofuels are produced from sugar, corn, broken rice, wheat, and starch, third generation (3G) biofuel is made from bacteria and algae.

The Assam venture will use 300,000 tons of bamboo every year to produce 144 gigawatts of green energy, besides biofuel.

AM Green is eyeing a significant market share across green hydrogen, green ammonia, biofuels, e-methanol, sustainable aviation fuels, and downstream high-value chemicals during India’s green energy shift.

Gentari Sdn Bhd, part of Malaysia’s Petronas, is planning a $1.5 billion investment for a 30% stake in AM Green Ammonia Holdings to produce 5 million tons per annum of green ammonia.

It has signed a term sheet with Yara Clean Ammonia for supplies from its green ammonia plant in Kakinada district of Andhra Pradesh state.

India’s national biofuel policy targets a 20% ethanol blend in petrol by 2025-26, well ahead of its earlier 2030 deadline.