India doubles budget for national green hydrogen push
Launched in January 2023 with an initial outlay of INR 19,744 crore (USD 2.38 billion), India's Mission aims to establish the country as a global hub for green hydrogen (H2). This initiative aligns with India’s vision for energy independence by 2047, reducing energy imports, and achieving net-zero emissions by 2070. The target is to reach an annual green H2 production capacity of 5 million metric tonnes (MMT) by 2030, with the potential for an additional 10 MMT/year in export markets. Key applications identified include ammonia production, petroleum refining, steelmaking, derivative fuels, and city gas distribution.
In August, India signed its first green hydrogen export agreement with Japan, enabling Sembcorp to transport hydrogen produced at a new facility in Tamil Nadu. Additionally, a $25 million tender has been issued for establishing testing facilities, infrastructure, and a regulatory framework for green hydrogen standards. This initiative is poised to enhance energy security and stimulate economic growth by attracting investments and creating jobs in renewable energy. The development of world-class testing and qualification facilities will spur innovation and position India as a leader in the global green hydrogen market. Furthermore, it will contribute to reducing greenhouse gas emissions and bolster the energy ecosystem, paving the way for a sustainable and resilient future.
For green hydrogen to significantly impact the economy and aid in industrial decarbonization, it must be competitively priced, which is currently a challenge. While the Ministry of New and Renewable Energy (MNRE) has focused on incentives for green hydrogen production, it is also crucial to implement demand-pull measures quickly. Strategies such as mandating a certain percentage of steel and ammonia production using green hydrogen, along with market-based incentives like subsidies, could effectively boost demand. Developing hybrid policies that combine regulations and incentives will be vital for fostering a thriving market for green hydrogen, ensuring that increased production costs are not entirely passed on to end-users.
Doubling the budget for India’s green hydrogen initiative could unlock significant opportunities for citizens, including job creation across diverse sectors, enhanced skill development through training programs, and support for entrepreneurship in renewable energy startups. This investment would improve energy access in rural areas, reduce air pollution leading to better public health outcomes, and drive technological advancements, positioning India as a leader in emerging technologies. Overall, this initiative could stimulate economic growth while promoting environmental sustainability and enhancing quality of life.
