Chemfab Alkalis commissions a new INEOS electrolyser, replacing a 30-year-old unit to improve efficiency, reliability, and reduce power costs.
Chemfab Alkalis Ltd has successfully completed the commissioning of a latest-generation electrolyser supplied by INEOS, marking a significant technological upgrade at its manufacturing operations. The new electrolyser has received all necessary statutory consents and regulatory approvals to commence commercial operations, ensuring full compliance with operational and environmental requirements.
This commissioning replaces the company’s previous electrolyser system, which had been in operation for nearly three decades. The earlier unit was a second-generation electrolyser originally supplied by UHDE, along with its associated balance equipment. While the legacy system had served the company reliably over the years, evolving efficiency standards, rising energy costs, and the need for improved operational performance prompted Chemfab Alkalis to modernise its core electrolysis infrastructure.
The newly installed INEOS electrolyser represents the latest generation of electrochemical technology, designed to deliver higher efficiency, improved reliability, and lower operating costs compared to older systems. By upgrading to this advanced electrolyser, Chemfab Alkalis expects to achieve a more stable operating profile, enabling higher on-stream factors and reduced downtime. Enhanced reliability is particularly important for chlor-alkali operations, where uninterrupted performance plays a crucial role in maintaining consistent output and controlling production costs.
In addition to improved reliability, the company anticipates meaningful gains in energy efficiency. Power consumption is one of the most significant cost components in electrolytic processes, and the new electrolyser is engineered to reduce electricity usage per tonne of production. As a result, Chemfab Alkalis expects to begin realising power savings starting from the fourth quarter of the financial year 2025–26. These energy savings are expected to directly contribute to margin improvement and strengthen the company’s cost competitiveness over the medium to long term.
Despite the technology upgrade, the company’s approved production capacity remains unchanged at 180 tonnes per day, as per the existing consent. This indicates that the project has been primarily undertaken to improve efficiency, operational stability, and cost optimisation rather than to expand capacity. Such an approach aligns with Chemfab Alkalis’ strategy of extracting greater value from existing assets while maintaining regulatory compliance and operational discipline.
The total capital expenditure for the electrolyser replacement project is approximately ?57 crore. Importantly, the entire investment has been funded through internal accruals, reflecting the company’s strong cash flow position and prudent financial management. By avoiding external borrowing for this project, Chemfab Alkalis has been able to strengthen its asset base without increasing leverage, thereby preserving balance sheet flexibility.
Overall, the successful commissioning of the latest-generation INEOS electrolyser marks a key milestone in Chemfab Alkalis Ltd’s ongoing efforts to modernise its operations. The project is expected to deliver long-term benefits in the form of improved energy efficiency, enhanced reliability, lower operating costs, and greater sustainability. These improvements position the company to better navigate volatile energy markets, meet evolving environmental expectations, and maintain a competitive edge in the chlor-alkali sector.
