The Narendra Modi government has approved a scheme that has been creating buzz among renewable energy enthusiasts and the industry for some time now, ushering in what promises to be India’s leap into mainstreaming a new-age fuel.
On 4 January, the Union cabinet approved – with a hefty budget of Rs 19,744 crore – the Green Hydrogen Mission, a programme that aims to produce 5 million metric tonnes of clean hydrogen fuel by 2030.
The scheme has been extolled by the government as putting India on a path to sustainable growth, in line with the country’s aspirations and needs. Praises have rung high from industry that views investments into green hydrogen – projected to cross Rs eight lakh crore – as an opportunity to lower their carbon footprint while maintaining growth.
Reliance Industries and Adani Group – two of India’s biggest conglomerates – have been in the race to produce green hydrogen ever since the tides shifted in its favour over a year ago when the prime minister announced the Mission on 15 August.
Enthusiasm for the fuel hasn’t stopped growing. Days before the cabinet approval, railways minister Ashwini Vaishnaw announced India would have its first green hydrogen-fuelled trains by the end of this year, and the NTPC said it had commenced a green hydrogen blending in Gujarat.
In the next eight years, the production of green hydrogen is expected to bring with it an additional 125 gigawatts of renewable energy capacity and create six lakh jobs.
But this transition toward a cleaner alternative hinges one pivotal action: accelerating India’s decarbonisation. The government hopes that the dash for green hydrogen will cut India’s enormous carbon emissions at 2.7 billion tonnes by around 55 million tonnes. Green hydrogen is in the company of solar, wind, hydro and nuclear in India’s bouquet of renewable energy sources.
India’s push for green hydrogen production is part of the government’s larger move toward increasing the adoption of renewable and green sources of energy. Early in its first term, the Modi government announced an ambitious target of 175 GW of renewable energy capacity by the end of 2022. That deadline has passed, and the target has been missed, but the capacity addition in the intervening period has been impressive. From 38 GW in October 2015, India’s renewable energy capacity grew to 116 GW by the end of 2022. Green hydrogen fits right into this move away from fossil fuels. And that is why it is ThePrint’s Newsmaker of the Week.
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What is green hydrogen?
To understand what the hydrogen hype is about, it’s essential to know how it works. Hydrogen is a colorless, odourless gas that is abundant in the atmosphere around us. But to use it as a fuel, it has to be extracted.
Green hydrogen is ‘green’ because of the extraction method involved — use of renewable sources can ensure zero emissions upon combustion. For perspective, one kg of coal – India’s primary source of electricity – generates about 2.4 kg carbon emissions when burned.
Green hydrogen is extracted through the process of electrolysis, which involves running a current through a liquid to separate elements. Other methods include the gasification of coal or steam methane reformation (SMR). However, these methods do involve the release of carbon and other greenhouse gasses in the process, making them unsustainable. Depending on the method and amount of greenhouse gas ultimately released, hydrogen is called ‘brown’, ‘grey’ or ‘blue.’
The hype of green hydrogen lies in its ability to replace fossil fuels in the production of carbon-heavy materials like steel and cement, as well as to power jetplanes and ships. Oil and gas form 85 per cent of India’s fossil imports. Domestic production and export of green hydrogen can help balance the scales is what the Modi government hopes.
At the moment, however, the costs are prohibitively high, at least for smaller players. It costs between Rs 300-400 to produce one kg of green hydrogen, and is considered to become viable for production only at a cost of around Rs 100 per kg.
In February 2022, the government came out with a policy to incentivise investments in green hydrogen, offering a waiver on inter-state transmission charges for solar or wind energy for 25 years and promising to set up a single-window portal for project clearances.
On Wednesday, the government added a slew of sops to this offering. “Under the Strategic Interventions for Green Hydrogen Transition Programme (SIGHT), two distinct financial incentive mechanisms – targeting domestic manufacturing of electrolysers and production of Green Hydrogen – will be provided under the Mission,” it announced in a press release, adding that benefits would extend to “pilot projects in emerging end-use sectors and production pathways.”
Hydrogen hubs will come up in states deemed most viable to host them, and clear rules, policies, and frameworks will shepherd interested players along the way, the government has promised.
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Is the hydrogen hype just hot air?
For many of the big announcements – such as Reliance’s $8 billion initiative on producing renewable energy equipment and Adani Green’s $50 billion deal with France’s TotalEnergies to set up electrolysers, production is yet to take off.
The current enthusiasm for green hydrogen isn’t the first time industry has been swept up by promises of an alternate fuel-led future, according to an Economist article, which references a craze in the 2000s for hydrogen fuel-cell cars, which ultimately fizzled out.
Critics have said hydrogen’s ability to service carbon-heavy industries might be limited by the sheer volume of the gas needed to service batteries, planes, and ships compared to traditional sources. Liquifying hydrogen is also an extremely energy-consuming process that could lead to inefficiencies.
“Hydrogen has a very good gravimetric energy density – the amount of energy carried per unit weight. On this measure, hydrogen beats diesel, petrol and jetfuel by a factor of around three, and LNG by a factor of 2.7 – which is why it makes a great rocket fuel,” energy advisor Michael Liebreich wrote in a Bloomberg article last year. However, “it has very poor volumetric energy density – the amount of energy carried per unit volume. It’s worth remembering that while a cubic meter of water weighs 1,000 kilograms; a cubic meter of hydrogen weighs only 71 kilograms. On a volumetric basis, hydrogen’s energy density is a quarter that of jet fuel, and only 40 per cent of that of LNG.”
But buoyed by international trends and the pressing need to transform the energy sector, conviction in the practical uses of green hydrogen is stronger than ever, experts have said. Demand for green hydrogen in India is projected to rise over four fold by 2050, according to the NITI Aayog.
The devil lies in how smoothly India is able to implement the Mission, and meet this growing demand.
(Edited by Anurag Chaubey)