Bulatov, international observer

Several dozen Indian companies have applied for subsidies for the production of “green” hydrogen as part of a specialized national program for the development of this promising area. In addition, around two dozen companies have applied for benefits and incentives related to the production of electrolyzers, as announced by the Solar Energy Corporation of India (SECI).

SECI operates as a central government company under the administrative jurisdiction of the Ministry of New and Renewable Energy (MNRE). The Corporation was established on September 20, 2011, its main objective is to facilitate the implementation of the National Solar Mission in achieving its goals. SECI is the only entity involved in the renewable energy sector in India.

$2.4 billion has been allocated for India’s green hydrogen programme. It aims to stimulate the production of green hydrogen and electrolyzers. The program was launched in the summer of 2023. Under the program, the Indian government is offering incentives of at least 10 percent of the cost of producing green hydrogen fuel.

The Indian government has so far received bids to produce 0.55 million tonnes of green hydrogen, up from the 0.45 million tonnes originally proposed. In addition, bids were received for 3.4 gigawatts (GW) of electrolyzers, up from the original proposal by 1.5 GW. The subsidies cover the first three years of production, according to documents obtained by Bloomberg. At the initial stage until 2029-30. Two separate financial incentive mechanisms are proposed to respectively stimulate electrolyser production and green hydrogen production.

The government plans to allocate about 130 billion Indian rupees (about 1.56 billion US dollars) for the production of green hydrogen. The remaining funds will be used to produce electrolyzers used in the process of splitting hydrogen and energy molecules using electrical means. The government intends to announce a tender for the supply of green hydrogen in three tranches, and for electrolyzers in two tranches. Each tranche will cover a capacity of 1,500 megawatts. In terms of production capacity, under this program the government will support the production of 3.6 million tons of hydrogen over the next three years and about 3,000 megawatts of annual electrolyser capacity over five years. Depending on the state of markets and technology developments, specific incentive schemes and programs will evolve as the mission is implemented, MNRE officials said.

As defined by the Indian government, green hydrogen is hydrogen produced using renewable energy sources. This includes various methods such as electrolysis or biomass conversion. This definition also applies to electricity generated from renewable sources, which may be stored in an energy storage system or connected to the grid in accordance with current regulations.

Standards for green hydrogen produced by electrolysis require that non-biogenic greenhouse gas emissions from water treatment, electrolysis, gas purification and hydrogen drying and compression processes must not exceed an average of 2 kilograms of carbon dioxide equivalent per kilogram of hydrogen over the previous 12 months.

The standards for green hydrogen produced from biomass conversion specify that nonbiogenic greenhouse gas emissions result from biomass processing, heat/steam generation, biomass-to-hydrogen conversion, gas purification, and hydrogen drying and compression processes must not exceed an average of 2 kg of carbon dioxide equivalent per kilogram of hydrogen over the previous 12 months.

The detailed methodology for measuring, reporting, monitoring, on-site verification and certification of green hydrogen and its derivatives shall be defined by the MNRE.

India’s national green hydrogen mission aims to “revolutionize” India’s energy landscape. By 2030, the mission aims to achieve a green hydrogen production capacity of at least 5 million tons per year, as well as an increase in renewable energy capacity of approximately 125 GW. Expected results: Over Rp 8 trillion in total investment, creation of over 600,000 jobs, cumulative reduction in fossil fuel imports exceeding Rp 1 trillion and reduction of nearly 50 million tons of annual greenhouse gas emissions.

Mission benefits include creating export opportunities for green hydrogen and its derivatives, decarbonizing the industrial, mobility and energy sectors, reducing dependence on imported fossil fuels, developing local manufacturing capabilities, creating jobs and developing advanced technologies. The Green Hydrogen Mission also supports pilot projects in new end-use sectors and production methods, and identifies and develops regions as green hydrogen hubs. To ensure mission success, an enabling policy framework, robust standards and regulations, and a public-private partnership structure for research and development must be in place. The Indian government is likely looking forward to a bright energy future for India, with the potential to further position the country as a leader in the green hydrogen sector.

Along with ramping up production capacity in India, the government has also begun discussions on potential exports of green hydrogen to France, Italy and Germany. The proposals are being sent through the Ministry of External Affairs, according to a Business Line report dated October 2023. India intends to export green hydrogen to other European Union countries, including the Netherlands, Austria and Sweden. In addition, the report of the National Green Hydrogen Mission states that bilateral negotiations are underway to sign agreements with Japan, South Korea and Singapore.

As per the existing foreign direct investment (FDI) policy of the Government of India, the renewable energy sector allows up to 100% FDI.