Huge Indian investment for green hydrogen

The Government of India recently announced a $2.3 billion plan to promote “green hydrogen” - hydrogen produced with renewable energy - which experts have said could be the clean fuel of the future. A government press release said that the National Green Hydrogen Mission will support the production, use and exports of green hydrogen, aiming to make India a global hub for the nascent industry. The funding is a first step towards establishing the capacity to make at least 5 million tons of green hydrogen by the end of this decade.

The aim of the funding initiative is “to make green hydrogen affordable and bring down its cost over the next five years. It will also help India reduce its emissions and become a major exporter in the field...the financing would also help add about 125 gigawatts of renewable energy capacity by 2030. As of October, India had about 166 gigawatts of renewable energy capacity,” said Anurag Thakur, India’s minister for information and broadcasting, according to an AP report.

As defined by industry experts, green hydrogen is hydrogen that is produced through the electrolysis of water, powered by electricity generated from renewable sources of energy. If the devices that do that, electrolysers, are powered by renewable energy, the product is called green hydrogen, a fuel free of greenhouse emissions. The energy it produces creates no carbon emissions. A Reuters report says that, however, in an industry still in its infancy, the key lies in significantly lowering production costs. The United States and the European Union have already approved incentives worth billions of dollars for green hydrogen projects.

The National Green Hydrogen Mission hopes to achieve the following likely outcomes by 2030: development of green hydrogen production capacity of at least 5 million tonnes per annum with an associated renewable energy capacity addition of about 125 GW in the country; massive increases in total investments; creation of over 600,000 jobs; sharp cumulative reduction in fossil fuel imports; and abatement of nearly 50 million tonnes of annual greenhouse gas emissions.

The Mission will have wide ranging benefits - creation of export opportunities for green hydrogen and its derivatives; decarbonisation of industrial, mobility and energy sectors; reduction in dependence on imported fossil fuels and feedstock; development of indigenous manufacturing capabilities; creation of employment opportunities; and development of cutting-edge technologies. India’s green hydrogen production capacity is likely to reach at least 5 million tonnes per annum, with an associated renewable energy capacity addition of about 125 GW.

A VoA report says that the initiative could help the world’s third-largest emitter of greenhouse gases reach its goal of net zero carbon emissions by 2070. A series of incentives are aimed at making green hydrogen affordable by bringing down production costs of a technology that has yet to become commercially viable.

The VoA report adds that while India has been rapidly expanding renewables such as solar energy, these will not be enough to meet climate goals in a country whose energy needs are expected to grow more than anywhere in the world over the next two decades. India’s current reliance on carbon-emitting coal, its primary source of electricity, has raised concerns on how it will switch to clean energy. India’s goal is to produce 5 million tons of green hydrogen per year by 2030. Experts call it an “ambitious” target and point out that at the moment India only has a handful of pilot projects in the sector. However, India wants to ensure that it is not left behind in a technology that is now being looked at with much more hope as the world grapples with a climate crisis. In giving a push to green hydrogen, India is following other countries like the United States and those in the European Union that have also approved incentives worth billions of dollars for its development.

The report goes on to say that as the government offers financial incentives, some of India’s biggest firms have made commitments to invest in green hydrogen. Still, experts say there are many challenges ahead in developing the nascent industry. India will have to scale up domestic manufacturing of electrolyzers, which are a key component to develop green hydrogen and also ensure that there is enough renewable energy available to make it. The investments needed will be huge. Domestic industries might have to be incentivized to switch to using green hydrogen. India is also eyeing exports of green hydrogen by becoming a cost-competitive source.