With the ‘Green Hydrogen’ project, India is ready to lead the world in energy transition

The resources allocated by the Indian government will position India as a global leader in hydrogen technologies across the entire supply chain, including the production and use of green hydrogen in manufacturing industries.

The first National Strategic Mission for the use of green hydrogen, approved by the Cabinet of the Government of India on January 4, 2023, will transform India into an innovative global hub for the production and export of green hydrogen, the so-called alternative fuel of the 21st century. The launch of this strategic mission marks a turning point for India’s energy transition, which has the potential to catapult India into a global exporter of clean energy.

Significant investments

The government has allocated approximately €1.96 billion for Strategic Interventions for the Green Hydrogen Transition Program (SIGHT), of which about €164 million is for the implementation of pilot projects, €46 million for research and innovation development, and around €45 million for other related components of the mission. SIGHT plans to develop five million metric tons (MMT) of green hydrogen production capacity by the 2030s, supported by 125 GW of renewable capacity. This will reduce 50 MMT of greenhouse gas (GHG) emissions and bring additional savings worth approximately €235 million due to the avoidance of fossil fuel imports. The introduction of green hydrogen will enable inter-sectoral decarbonization and reduce dependence on imported fossil fuels and raw materials. The strategy will also support the development of domestic capacities for the production of electrolyzers, which will, directly and indirectly, strengthen the development of primary, secondary, and tertiary activities in the mentioned business segments.

India currently spends over $160 billion annually on energy imports. This is expected to increase significantly in the next decade due to rapid urbanization and India’s ambitions for industrialization. The introduction of green hydrogen will reduce energy imports and provide energy security in cases of global as well as geopolitical energy crises. It is estimated that by 2030, India will consume 11.7 million tons of industrial green hydrogen with high carbon intensity, primarily in the refining and fertilization sectors, double the 5.6 MT today.

The private sector as a driver

The Indian industry has developed ambitious plans and established key global partnerships for mutual trade in green hydrogen. Even before the launch of the Green Hydrogen Mission in January 2023, leading industrial houses such as RIL, L&T, Adani, and NTPC announced investment plans in green hydrogen worth billions of dollars. All energy players, such as Greenko, Renew, and Acme, have announced green hydrogen production targets on a much larger scale than before. The launch of this mission will further strengthen confidence in the Indian clean energy sector.

The size and scale driving the low-budget green hydrogen policy in India are unequivocally aimed at reducing the costs of green hydrogen by addressing the delivered costs of green energy and creating large-scale demand within existing industrial sectors that consume hydrogen.

A global hydrogen hub

The mission should also focus on research and development in niche aspects of distribution, including storage, transport, and distribution of green hydrogen and its derivatives. The versatility of green hydrogen as an energy vector and critical green chemical positions it as one of the key pathways for transferring green energy in terms of distance and time. Green hydrogen, being a light molecule, can pose significant logistical challenges as a gas in transport, thus it must be stored under cryogenic conditions for transportation. However, various solutions are already being proposed to address this issue. Due to its mature technological level, existing transport carriers, and well-understood regulatory regime, hydrogen can be transported in the form of ammonia.

India is blessed with renewable energy sources, three times lower construction costs than competing regions, and an innovative clean energy sector, which allows it to lead the production, storage, and transport of ammonia to Europe and Japan. The industry, in collaboration with the central government and state governments, should strive to establish large-scale production of green hydrogen and production units for electrolyzers, transforming India into a net energy exporting country in the coming decade.

As Prime Minister Narendra Modi envisioned – green hydrogen is the future of the world, a fuel that will not only help India achieve new progress in energy self-reliance but will also become a new inspiration for the clean energy transition worldwide.