A. Nair
India has announced plans to boost domestic production of green hydrogen to 5m t/year by 2030. The country’s National Green Hydrogen mission policy should help India become a green hydrogen hub.
‘The implementation of this policy will reduce dependence on fossil fuel and reduce crude oil imports,’ according to a statement from the Indian Ministry of Power.
With 85% of India’s oil and 53% of its gas needs imported, hydrogen could be a game changer for energy security. Green hydrogen production could become more economical for users of hydrogen and ammonia, such as oil refineries and fertiliser and steel plants. Currently, these sectors use grey hydrogen or grey ammonia produced from natural gas or naphtha.
The Government also announced incentives for manufacturers and generation companies to boost large-scale domestic production of green hydrogen. Incentives include a 25-year free inter-state transmission of renewable power for the production of green hydrogen to expand use of the truly carbon-free fuel. The elimination of interstate transmission fees would help push the price of green hydrogen from about $5-6/kg at present to below $2/kg over the next five to six years, and to about $1.50/kg by the end of the decade.
The Government is also said to be looking into a uniform renewable purchase obligation mechanism for refineries and fertiliser plants, which will start at 10% and then increase to 20-25%.
Private sector companies investing in the green hydrogen supply chain include Reliance Industries, the Adani group, Larsen & Toubro (L&T), and Greenko. Public sector enterprises have also joined in, such as Indian Oil Corporation, Bharat Petroleum Corporation, GAIL (India), and NTPC. In December 2021, ReNew Power, among the largest independent renewable energy producers, joined forces with Indian conglomerate L&T to establish green hydrogen facilities in India.
As of 15 November 2021, ReNew had approximately 10.3GW of renewable energy projects in India, including commissioned and committed projects.
Companies like the Adani Group are already showing the way. In a non-binding agreement signed on 21 February 2022, Adani Group and Nasdaq-listed Ballard Power Systems are to explore a joint venture to produce hydrogen fuel cells in India for various mobility and industrial applications.
The Gautam Adani logistics-to-energy conglomerate announced in November 2021 it would invest $70bn in the new energy space of the next decade. ‘Building a world-class green hydrogen value chain will be critical to facilitating the energy transition,’ said Director Vneet S. Jaain.
Meanwhile, Ballard’s President & CEO Randy MacEwen comments: ‘India represents a new growth opportunity for Ballard.’
The company is to deploy innovative use cases across its businesses with fuel cell trucks, mining equipment, marine vessels, off-road vehicles and critical industrial power. The group’s green hydrogen efforts include downstream products, green electricity generation, and manufacture of electrolysers and wind turbines.
Phase 1 of the Government’s policy began on 17 February 2022. As part of phase 2, refineries, fertiliser companies etc. will be mandated to use green hydrogen and green ammonia in a phased manner and offered production linked incentives, along the lines of those offered to the pharmaceutical sector. No implementation date or financial resources have been committed at this time.
The Cabinet will need to approve the proposal, which is currently under consideration of the expenditure finance committee.
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