The Indian Ministry of New and Renewable Energy has released a document at the beginning of the year which lays out a detailed plan for the country to follow in its quest to achieve the “global hub” status within the green hydrogen and derivatives industry, in addition to becoming energy independent. India can achieve this by reshuffling its entire economy in order to make space for green hydrogen and ensure both demand and supply co-exist in what could turn India into a wealthy export powerhouse.
In order for the Mission to be accomplished, India aims to produce at least 5 million metric tons (MMT) of green hydrogen per annum by 2030, with the potential to reach 10 MMT per year. The Mission will also support the replacement of fossil fuels and fossil fuel based feedstock with renewable energy and feedstocks based on green hydrogen, production of green ammonia, blending hydrogen in gas distribution systems, green steel manufacturing and the decarbonization of the mobility, shipping and aviation sectors. Moreover, the country aims to also become a world leader in manufacturing electrolyzers.
The entire Mission is being backed by an initial funding approved by the Indian Cabinet worth $2.4 billion in the form of subsidies. Most of the funding ($2.11 billion) will go towards two distinct financial incentives: one for the production of green hydrogen and the other for the domestic manufacturing of electrolyzers.
It is estimated that India currently uses 5 MMT of grey hydrogen per year – grey hydrogen is formed via steam methane reformation of natural gas or naphtha, without capturing the CO2 it releases. As part of this roadmap, India plans to direct its efforts towards reducing the capex and opex that dictate the price of green hydrogen by making use of its low levelized cost of wind and solar energy as well as through exploring the option of allowing investors to make dollar denominated bids. The appeal of trading in a more powerful and stable currency rather than the Indian Rupee will no doubt lure more interested parties the Asian country hopes.
The entire Mission is seen as a two-part job with Phase 1 starting now and spanning over the short term until 2026 and Phase 2 spanning over the following four years until 2030. Phase 1 will initially tackle the sectors that already use hydrogen in order for these to transition to the green version of the gas as soon as possible and reduce emissions. It will then look to indigenize the value chain by investing into pilot projects that will create and sustain the demand. At the same time work will commence on establishing a framework of regulations and standards to facilitate the growth of the sector and enable harmonization and engagement with international norms. Lastly, driving the cost of green hydrogen down will enable the second phase of the Mission.
Phase 2 will eye more industrial activities switch from fossil fuels to green hydrogen like refineries, fertilizer manufacturing, steel, mobility, shipping and aviation. This will have an immense benefit on the decarbonization of the third most polluting country with a world share of emissions of 7.09%.
A multitude of arteries of the Indian economies need to align their visions and plan of action in order for such a large-scale operation to succeed. For example the Ministry of Power will need to implement policies and regulations to ensure delivery of renewable energy for green hydrogen production at the lowest possible costs, while the Ministry of Chemicals and Fertilizers and the Ministry of Petroleum and Natural Gas will make sure that their respective industries guarantee that demand for the gas will be in place.
Additionally, the Ministry of Ports, Shipping and Waterways will play a crucial role in establishing India’s export capabilities for green hydrogen and its derivates through the development of infrastructure including storage bunkers, port operations equipment, and refueling facilities.
Rethink previously covered a $2.8 billion investment made by Jackson Green into a green hydrogen and green ammonia project in North-West India, which can be accessed here. Our take is that his is ambitious, but then so many other hydrogen hub projects are even larger than this, that India has perhaps underestimated the required scale.