Last Update 06 September 2023

Why localization of electrolyzer manufacturing capacity be a steep challenge for India?

Why is it key to secure the key critical materials for India to have local electrolyzer manufacturing hub?

Degree of risks for critical materials sourcing for India to support electrolyzer manufacturing is very high as the import reliance is massive.
For a country like India, which is in its nascent stage of building an ecosystem for green hydrogen production it becomes quintessential to secure the supply chain for electrolyzer’s manufacturing in the country. While analyzing the supply chain for electrolyzers we realized that as the demand for hydrogen grows in the country the requirement for key materials required for electrolyzers and fuel cells shall also grow immensely. The reliance on imports for such key materials which would be central to local electrolyzer manufacturing poses a missive risk to the goals which India envisions for green hydrogen development. The materials whose demand is projected to go up and are currently dependent on imports only are considered most critical.

Materials like iridium, yttrium, platinum, lanthanum, graphite and strontium are classified as most critical followed by titanium & zirconium as critical material for aiding electrolyzer manufacturing in India.

Mr. Ravi Shekhar, Director & Head, of Eninrac Consulting says “India's quest to localize electrolyzer and fuel cell manufacturing capacity for green hydrogen production represents a commendable yet intricate challenge. The nation's aspirations to lead in the green hydrogen sector are founded on the imperative of mitigating climate change, ensuring energy security, and fostering economic growth. However, the path to achieving these ambitions is riddled with multifaceted hurdles that span technological, economic, social, and environmental dimensions.

The challenges related to materials supply chains, highlight India's vulnerability to global market fluctuations and geopolitical tensions. To overcome these challenges, India must urgently develop a robust domestic supply chain for critical materials, invest in research and innovation, and foster international collaborations. Simultaneously, addressing the immaturity of the electrolytic hydrogen market, optimizing electricity resources and markets, and building a comprehensive hydrogen infrastructure are essential steps to ensure the viability of green hydrogen as a clean energy source.

Furthermore, India's commitment to energy and environmental justice, workforce development, and international competitiveness is pivotal for the equitable and sustainable growth of the green hydrogen sector. By addressing these challenges comprehensively and proactively, India can not only secure its energy future but also make significant contributions to global efforts in combating climate change. The localization of electrolyzer and fuel cell manufacturing capacity is not just a challenge; it is a transformative opportunity to shape a more sustainable and prosperous future for the nation and the world.”

What are the key vulnerabilities for Indian electrolyzer manufacturing?

India’s vulnerabilities with respect to electrolyzer and fuel cell supply chains include the immaturity of electrolytic hydrogen markets, the need for electricity to produce hydrogen and market structures to access that electricity, a lack of sufficient hydrogen infrastructure to support market growth, a lack of electrolyzer and fuel cell manufacturing capacity, energy and environmental justice issues for key materials, a need for workforce development, and a need to consider international competitiveness.

International competitiveness: International markets for hydrogen are emerging with production in countries rich in low-carbon energy resources planning to export to countries with strong demands for clean hydrogen. Without consistent and equal standards, which would also suppress hydrogen production with carbon-intensive means, energy and environmental justice issues may arise around traded hydrogen.

Potential Challenges for India – Green Hydrogen
• Electrolytic hydrogen market development
• Electricity resources and markets in India
• Hydrogen Infrastructure availability
• Electrolyzer and fuel cell key raw materials availability

- Communications Team


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